5 Reasons why car insurance in Detroit is always expensive

Are you looking for cheap car insurance in Detroit? If that is the case, it’s going to be a tough ride for you.

The average annual car insurance premium that a Detroitian pays is $10,723, which is the maximum among the large US cities. This figure is more than double the average of the second most expensive US cities, and 10 times more than the average in states like North Carolina. But why you? Unfortunately, the high-crime rates, magnitude of traffic, a large number of uninsured motorists, vastness of insurance fraud, and on top of all, Michigan’s no-fault insurance system have contributed to the sky-high prices you are bearing today. 1. Car theft and vandalism: There must be some reason behind naming Detroit as ‘Carjack City’. If we go through the pages of Detroit’s crime history, we’d find that it had 11,893 motor vehicle thefts in 2013, or 1,699 per 100,000 residents, which is far above than the national average of 221. According to Forbes, Detroit is one of the most dangerous cities in America, with a violent crime rate that is 5 times the national average. If rates of crime, theft and vandalism are higher, insurance rates are definitely going to rise, since car owners will claim for any damaged or stolen vehicle. 2. Traffic volume: Detroit has densely populated neighborhoods and this is another reason why insurance premiums are higher here than the rest of Michigan. There is no doubt that if you are driving in a densely populated area, there are greater risks of getting involved in an accident. 3. No-fault insurance: As per Michigan’s no-fault insurance law, you are required to carry no-fault auto insurance if you drive. This no-fault auto insurance offers unlimited medical benefits to motorists suffering from auto injuries for lifetime. Again, doesn’t matter who’s at fault, there is wage loss benefit of up to $5,392 per month for up to three years. This also means that your premiums can go up after an accident even if you were not at fault. Critics who are against no-fault insurance argue that higher premiums are just because of generous accident benefits and it also encourages negligent and fraudulent behavior. 4. Insurance fraud: Fraud is another issue in Detroit. The city that fills just 7% of the state’s population was accounted for? of the questionable insurance claims submitted in 2012 to the National Insurance Crime Bureau. 5. Personal injury protection: On top of state imposed no-fault insurance, car owners in Michigan are required to have personal injury protection and residual liability coverage. All these add to the costs of having auto insurance in Detroit.