Michigan car insurance policies are more expensive than in many other states. The state does allow more different levels of liability coverage, however, and that can make it easier for people to tailor their policies to match their budgets. Michigan keeps its car insurance rates under control by using a no-fault system. No-fault insurance avoids expensive legal bills to go along with liability payouts. Michigan car insurance companies also set rates based on certain factors that they feel mitigate the risk of insuring a particular driver. Here is a short list of the primary factors that affect car insurance rates in Michigan.
The Type of Vehicle
It’s obvious that the more expensive the vehicle you drive, the more your car insurance will cost. That’s not the only factor that insurers take into account, however. If you have a high-performance sports car, expect to pay more for your coverage than someone driving a minivan, even though the minivan might carry a higher sticker price. Insurers consider high-risk driving more likely if you’re in a powerful roadster than an everyday driver. Other attributes of your vehicles might weigh in your favor. If your car or truck has extra safety equipment or a security system, expect your insurance company to give you a break on your premium.
The Driver’s Age
It’s a lot more expensive to buy insurance for a teenage driver than for an adult. That’s because teens are statistically more likely to have accidents than other age groups. Your rates will continue to change as you get older. Drivers between 50 to 65 years old usually get the lowest rates. Rates climb after you reach age 66, and continue to climb every year after.
Michigan car insurance rates aren’t identical all over the state. If you live in a big city or a high-crime area, you’ll pay much higher rates than if you live in a sleepy town with a low population. Michigan insurers expect drivers that use more crowded roads to have more accidents, and car theft is higher in cities. If you live in extremely rural areas, you might see your rates climbing a bit because of the poor quality of the roads, however.
Your Level of Liability Coverage
Michigan car insurance companies want you to carry more than the minimum amounts of liability insurance. This isn’t entirely because they want to collect higher premiums. They see higher insurance coverage limits as a sign of caution on the part of the insured, and consider caution to be a way to identify a better insurance risk for their company.