When it comes to car insurance rates, where you live plays a significant role in determining how much you’ll pay. Urban and rural areas often see striking differences in premiums, driven partly by population and motor vehicle crime rates. Generally speaking, drivers in larger cities will pay more – sometimes hundreds of dollars more – than motorists who live in smaller towns or rural areas.
Let’s explore how your location – whether in the heart of a bustling city or the tranquility of the countryside – shapes your car insurance costs and why these differences matter.
- In California, a driver in the rural northern part of the state may pay half as much for car insurance as a driver in Los Angeles.
- Residents of traffic-choked Atlanta pay 46% more than residents of much smaller Valdosta.
- A driver in sprawling Houston may pay about $700 more for coverage than a driver in the north Texas city of Wichita Falls.
Factors shaping regional car insurance premiums
Where you live can make a huge difference in how much you pay for coverage. Some of the most important factors include:
- Population density: In large urban areas, the sheer number of drivers and cars moving about leads to more accidents, which results in more claims. More accidents and claims will almost always result in higher premiums.
- Crime rates: The Department of Justice says cities have significantly higher crime rates than small towns, which can also contribute to higher insurance rates.
According to National Insurance Crime Bureau statistics, California had 208,668 vehicle thefts in 2023, more than half of which occurred in the Los Angeles and San Francisco-Oakland metropolitan regions.
- Insurance fraud: Common forms of car insurance fraud include inflated or falsified repair costs and staged accidents, says Stephen Yao, associate professor of insurance and risk management at the University of Central Arkansas
“Fraud is always a significant issue for car insurance,” he says.
- Traffic fatalities: Rural residents are involved in fewer accidents than city drivers, but rural accidents are more deadly.
According to the Insurance Institute for Highway Safety (IIHS), in 2022, the rate of crash deaths per 100 million miles traveled was much higher in rural areas than in urban areas – 1.68 in rural areas compared with 1.15 in urban areas.
Comparing auto insurance rates in small, medium and large urban areas
Generally speaking, residents of large urban areas with populations of more than 1,000,000, like Los Angeles or Houston, will pay considerably more for car insurance than drivers who live in a rural area like Mt. Shasta, California (population 3,223) or a small city like Valdosta, Georgia (population 55,378).
“There are more drivers, walkers, public facilities and more complex driving rules such as no right turns on red, and one-way roads in regions with a larger population,” Yao says. “Furthermore, most insurance costs and expenses, legal fees and commissions are also generally higher [in urban areas]. All those factors caused by or related to a higher population lead to higher insurance rates overall.”
How rates vary in California
California is a good example of how state rates vary based on population. Golden State drivers pay $2,416 annually for full coverage, $521 more than the national average. If you look at average rates by city, premiums are even higher. Los Angeles drivers pay the most for car insurance, $3,149 annually.
However, other large metropolitan centers with populations of 500,000 to 1,000,000 people – Oakland ($2,802), San Francisco ($2,777), and Sacramento ($2,665) – can be costly as well. Even cities far from major population centers, like Fresno ($2,324) and Bakersfield ($2,477), are pricey for drivers.
But head to rural areas, and you’ll find that car insurance premiums are far less expensive. Tiny Mt. Shasta in far northern California has the cheapest rates in the state. Still, other small towns with populations of less than 10,000 people – Yreka ($1,582), Blue Lake ($1,650), and Cambria ($1,670) – are also quite affordable by comparison.
Rates by city in California, Florida, Georgia, Illinois and Texas
Below, you’ll find a list of the five largest states by population, with sample yearly rates for full coverage in small, medium and large towns and cities. No matter where you go, drivers in larger cities pay more for car insurance.
| City | Average rate |
|---|---|
| Mt. Shasta | $1,571 |
| Bakersfield | $2,477 |
| Los Angeles | $3,149 |
| City | Average rate |
|---|---|
| Santa Rosa Beach | $1,951 |
| Jacksonville | $2,692 |
| Miami | $3,345 |
| City | Average rate |
|---|---|
| Valdosta | $1,330 |
| Athens | $1,816 |
| Atlanta | $2,470 |
| City | Average rate |
|---|---|
| Bloomington | $1,311 |
| Champaign | $1,367 |
| Chicago | $1,930 |
| City | Average rate |
|---|---|
| Wichita Falls | $1,616 |
| Austin | $1,930 |
| Houston | $2,317 |
Remember, the rates listed above are averages; the amount you pay for car insurance will vary based on your circumstances.
Strategies to save regardless of where you live
It’s a good idea to shop around for car insurance now and again to ensure you’re still getting the best deal on coverage. Experts recommend checking rates every six to 12 months – before your current policy renews or if you’ve recently experienced a significant life event like getting married or moving.
A free online car insurance calculator is a good place to start. With just a few pieces of personal information – including your ZIP code, your age range, and the make and model of your vehicle – you can get a ballpark estimate of how much a new policy may cost. You’ll need to speak with an agent or company representative to get a more accurate quote and to purchase coverage.
Shop around to save
Premiums can vary dramatically among carriers. For example, drivers who have coverage through Nationwide pay an average of $1,548 for full coverage, while those insured with Allstate pay $2,509. By shopping around for car insurance, you may get cheaper coverage with another carrier.
Shop your coverage once a year or whenever a significant life event occurs, such as buying a new car, moving to a new neighborhood, or even a bump in your credit score. Make sure you are comparing equivalent policies regarding coverage levels and deductibles.
Price isn’t the only consideration, though. Drivers say good customer service and satisfactory claims resolution are also important when switching car insurance, according to CarInsurance.com surveys.
Research firm J.D. Power conducts rigorous annual surveys on car insurance, gauging policyholder satisfaction with shopping and service, claims handling, rates and more. These reports can be an excellent resource for learning more about where carriers excel and where they need to improve.
Experts also say a carrier’s fiscal health can be significant, as reflected in its AM Best financial strength rating because you want to be sure that your carrier can cover claims in the event of a major disaster.
Leverage car insurance discounts to save money
No matter where you live, you may qualify for car insurance discounts that can lower your premium. Talk with your agent or company representative to determine what savings opportunities you may be eligible for. Some of the most popular discounts carriers offer include:
- Bundling policies: Buying your home, renters, or condo insurance from the same insurer that provides your car insurance can result in a discount of 10% or more, depending on your carrier. Some insurers also offer multi-policy savings for bundling motorcycle, pet, or life insurance with your auto policy.
- Driving safely: A clean driving record remains one of the best ways to ensure you’ll get the best car insurance rates possible. You can save up to 25% if your record is free of tickets and at-fault accidents for at least three years.
- Opting for a vehicle security system: If your automobile has an anti-theft system or you have installed an after-market car alarm or vehicle monitoring device like LoJack, you could save 5% or more on your policy. If you live in an urban area with a high crime rate, this could be a particularly beneficial discount to consider.
- Choosing a telematics program: By agreeing to have your driving habits monitored – either with a phone app or a plug-in device – you may be eligible to save as much as 10% by being a careful driver. The one drawback: If you exhibit poor driving skills, your carrier may charge you more for coverage.
- Being a loyal customer: If you’re satisfied with your current insurer, it can pay to remain with them year after year. Many carriers offer a customer loyalty discount, which can result in a discount of about 10%.
Understand and optimize your car insurance rates
If you’re in a large urban area, it’s a safe bet that you’ll pay more for car insurance than someone in a smaller city or rural town. But other factors – the kind of vehicle you own, your driving record, your age and gender, and even your profession – will also affect how much you pay for coverage.
No matter where you live, you can take action to lower your car insurance rates, such as:
- Asking your insurer about discounts
- Raising your deductible
- Reducing your coverage
And don’t be afraid to shop around for more affordable coverage every six to 12 months, or before your current policy renews. Our free car insurance calculator offers estimates based on your ZIP code.
Want to know more about car insurance where you live? Check out our state-by-state car insurance coverage.
Resources & Methodology
Sources
- Insurance Institute for Highway Safety. “Fatality facts 2022 urban/rural comparison.” Accessed February 2025.
- New York Post. “Viral staged crash on NYC’s Belt Parkway probed by NYPD — as experts warn accident fraud cases are on the rise.” Accessed February 2025.
- Office for Victims of Crime. “Urban and rural victimization.” Accessed February 2025.
- United States Census Bureau. “Mount Shasta city, California.” Accessed February 2025.
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