Car insurance rates have been on the rise nationwide. This has also held true for the state of Michigan. With drastic changes to the state’s auto insurance laws, the future of insurance rates in Michigan is unclear. Lawmakers hope the changes will drive down some of the nation’s highest car insurance rates. In any case, rates vary widely based on the insurer, city/county, age, driving history, type of vehicle, and even credit score.

 

Ann Arbor, Michigan
Ann Arbor, Michigan

Best Auto Insurance in Michigan

Finding the best auto insurance in Michigan isn’t as difficult as you may believe. Knowing what insurers look for as well as factors unique to Michigan can help you find the right insurance. To get a clearer idea of how auto insurance works and how to find the best car insurance companies in Michigan, let’s first take a look at how Michigan laws regulate drivers, their insurance, and their vehicles.

Car Insurance Laws for Michigan

According to the Michigan Department of Insurance and Financial Services, drivers must abide by the following regulations:

  • Every vehicle owner in Michigan must obtain car insurance, and car insurance must be made available to every eligible citizen.
  • A citizen of Michigan is eligible for car insurance if they own a vehicle registered in Michigan and/or hold a valid Michigan driver’s license.
  • Michigan law requires drivers to maintain no-fault auto coverage.
  • Michigan no-fault auto coverage has three parts: Personal Injury Protection (PIP), Property Protection Insurance (PPI), and Bodily Injury & Property Damage (BI/PD).
    • Personal Injury Protection (PIP) pays all necessary medical expenses (with no maximum limit) in the event that you are injured in a car accident.
    • Property Protection Insurance (PPI) pays up to $1 million in damages in the event that your vehicle causes damage to someone else’s property.
    • Bodily Insurance & Property Damage (BI/PD) provides coverage if you are found at fault and sued for damages. The minimum BI/PD required by Michigan state law is $20,000 per person killed or injured in an accident, $40,000 per accident involving injury or death, and $10,000 for property damage in a state other than Michigan.

How Car Insurance Rates are Determined in Michigan

As of the latest data, good drivers in Michigan pay an average of $2,770 annually for auto insurance or about $230 per month. These are some of the highest car insurance rates in the nation. Rates vary by the insurance provider, location, insurance type, and the level of coverage. However, these rates are also highly dependent on drivers.

When an insurance provider is calculating your rates, they will look at the following factors:

  • Location – Generally, if you live, commute, or work in an urban area (like Detroit, Grand Rapids, or Warren), your rates will be higher, as accidents are more prevalent in densely-populated regions. However, other location-based factors are important, too, like adverse weather conditions and reports of vandalism.
  • Age – Statistically, younger drivers get in more accidents. This means that the younger you are, the more you will need to pay in insurance premiums. The average age in Michigan is 40, which is higher than the national average.
  • Gender – Men are more likely than women to get in accidents, so your gender could impact your auto rates as well.
  • Marital Status – Typically, married couples take fewer risks than their single counterparts, and this holds true for driving. Married couples get in fewer accidents, and therefore pose a smaller risk for insurance providers.
  • Driving Experience – While this metric is similar to age, it is still slightly different. Usually, the older you are, the longer you have been driving, but that is not always true. Nonetheless, people who have held a driver’s license for longer are more experienced, and therefore pay lower premiums.
  • Driving Record – A driver’s record is one of the most important factors that insurance providers consider. If you have a history of frequent speeding tickets, DUIs, or other infractions, you will have to pay more. Michigan’s rate of traffic incidents is somewhat lower than the national average.
  • Claims Record – It is also important to consider how many claims you have made to insurance providers in the past (if any). At-fault claims will cause your premiums to rise, while not-at-fault collisions will generally have no impact on your rates.
  • Credit History – Your credit is a good indicator of how financially responsible you are, but the research also shows that people with low credit tend to file more claims, making them a greater risk for insurance providers.
  • Previous Insurance Coverage – If you have maintained auto insurance without any gaps, your new insurance provider will see this as a good sign. However, if you went for several years, months, or even days without any insurance, you will be seen as high-risk.
  • Vehicle Type – Certain cars are driven differently, which means that certain cars are more prone to accidents. Some cars are also more prone to theft or vandalism.
  • Use of Vehicle – When you exclusively use your vehicle for personal use, you are less likely to get in an accident. However, if you take long business trips or frequently drive for your work, you increase your chances of a collision.
  • Annual Mileage – How much you drive directly impacts your chances of getting in an accident. No matter how you use your vehicle (personal or business use), if you put a lot of mileage on your car, you are more likely to file a claim with your insurance provider.
  • Number of Policies – Finally, the type of insurance you want/need will help determine your rates. The more policies you have (liability, comprehensive, uninsured motorist, etc.), the more you will need to pay.

Best Car Insurance Companies for Michigan

When looking at rates across the entire state, there are 4 major insurance companies that consistently provide low rates for good drivers. Additionally, there are several other companies that provide low rates in certain cities and counties but do not consistently provide low rates statewide.

In any case, let’s take a look at some of the lowest auto insurance rates and best car insurance companies available in the state of Michigan:

ProviderAnnual RateMonthly Rate
MetLife$1,274$106
Hastings Mutual$1,534$127
Chubb$1,908$159
Frankenmuth$2,213$184

 

It is important to note that the table above shows the average rates for the minimum coverage required by the state of Michigan. For standard, comprehensive, or “full coverage,” the rates are significantly higher:

ProviderAnnual RateMonthly Rate
MetLife$1,690$140
Hastings Mutual$1,915$159
Chubb$2,385$198
Frankenmuth$2,655$221

 

These are approximate rates based on statewide polling for 40-year-old men and women with good driving records. Naturally, individual rates will vary. Additionally, insurers like the Auto-Owners Insurance, Pioneer State Mutual, and MEEMIC provide low rates for certain areas and applicants.

So, in order to get a better picture of auto insurance rates around the state, let’s look at how rates vary by city.

Related: The Cheapest States for Car Insurance Premiums 2020

Best Michigan Car Insurance Rates by City

Aside from your driving history, your location is one of the most important factors when calculating the cost of your auto insurance. Population, crime rates, weather conditions, and the cost of living can all affect the amount you pay each year. Individuals who live and work in rural areas typically have the lowest rates. However, the majority of Michigan residents live in urban or suburban areas, where rates tend to increase.

The table below shows the average yearly auto insurance rates for 50 of the most populated cities in Michigan, in alphabetical order. These are approximate rates based on statewide polling for 40-year-old men and women with good driving records. Additionally, this data is taken from all of the best car insurance companies in Michigan.

Here is what the data shows:

CityAverage Yearly Rate
Ann Arbor$1,332
Battle Creek$1,368
Bay City$1,596
Bloomfield$1,740
Canton$1,464
Chesterfield$1,428
Clinton$1,680
Commerce$1,608
Dearborn$2,520
Dearborn Heights$2,328
Detroit$3,108
East Lansing$1,428
Farmington Hills$1,668
Flint$1,440
Georgetown$1,680
Grand Blanc$1,692
Grand Rapids$1,452
Holland$1,332
Independence$1,884
Kalamazoo$1,428
Kentwood$1,452
Lansing$1,560
Lincoln Park$1,932
Livonia$1,740
Macomb$1,680
Meridian$1,452
Midland$1,344
Muskegon$1,512
Novi$2,028
Orion$1,356
Pittsfield$1,476
Pontiac$1,680
Portage$1,356
Redford$2,520
Rochester Hills$1,596
Roseville$1,776
Royal Oak$1,740
Saginaw$2,304
Shelby$1,596
Southfield$2,028
St. Clair Shores$1,740
Sterling Heights$1,668
Taylor$2,304
Troy$1,704
Warren$1,740
Waterford$1,740
West Bloomfield$1,632
Westland$1,884
Wyoming$1,032
Ypsilanti$1,608

 

Now, let’s take a closer look at the top-5 largest cities in Michigan and compare their respective auto insurance rates.

Detroit

In Detroit, the average annual premium is $3,108 for minimum liability insurance and $3,885 for full auto coverage. However, as with most large cities, these prices can vary by district or neighborhood. For example, residents of Eastern Market and Midtown tend to pay more in car insurance premiums than residents of Rosedale Park or Cass Corridor.

More than 75% of Detroit’s roads are considered to be in either “mediocre” or “poor” condition. As a result, vehicles incur additional wear-and-tear in the city, and drivers must pay higher premiums for it.

Grand Rapids

In Grand Rapids, the average annual premium is $1,452 for minimum liability insurance and $2,178 for full auto coverage. Though there are much more expensive cities for auto insurance in Michigan, premiums in Grand Rapids are still significantly higher than the national average. This is due in part to the hazardous weather conditions in winter. Additionally, Grand Rapids has a high rate of reported accidents.

Warren

In Warren, the average annual premium is $1,740 for minimum liability insurance and $2,610 for full auto coverage. Warren sits just to the north of Detroit, but thanks to a lower population and less traffic congestion, premiums are much lower for drivers in Warren.

That said, Warren still has to deal with heavy ice and snow during winter months, which can make roads slick, leading to more collisions.

Sterling Heights

In Sterling Heights, the average annual premium is $1,668 for minimum liability insurance and $2,418 for full auto coverage. Fortunately for local drivers, Sterling Heights is one of the safest cities in Michigan. This means that drivers are at a lower risk of vandalism and auto theft, which helps keep insurance premiums low.

However, like many cities in the state, weather and hazardous road conditions increase the risk of accidents throughout much of the year.

Ann Arbor

In Ann Arbor, the average annual premium is $1,332 for minimum liability insurance and $2,131 for full auto coverage. Insurance premiums do not vary much by neighborhood in Ann Arbor. That said, rates are somewhat higher for those who live and work in Kerrytown.

Ann Arbor’s car insurance premiums are relatively low compared to the rest of the state. This is largely due to low traffic congestion.

Regarding the Best Auto Insurance in Michigan

There are a lot of variables that affect the cost of auto insurance in Michigan. Additionally, the figures provided above are averages based on adults with good driving records, so the exact rates you pay may differ. Hopefully, this information helps you when you’re ready to obtain a new policy or upgrade your current one with one of the best car insurance companies in Michigan.

Consult our other car insurance guides and resources if you’d like to learn more. And if you’re looking for more information about Michigan auto insurance, consult the Michigan Department of Insurance and Financial Services.

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Matthew Jones