Why is Car Insurance So Expensive in Louisiana?

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If you look at a list of the most expensive car insurance policies by state, then you may be surprised to see Louisiana on the list.

Louisiana is typically ranked as one of the top five most expensive states in America for car insurance. In many years, it’s been ranked as high as number one or two on the list.

What makes it so expensive to insure a vehicle in Louisiana? Why is car insurance so expensive in Louisiana? Today, we’re answering all the questions you might have about vehicle insurance prices in Louisiana.

Why Do Louisianans Pay More for Car Insurance?

Louisiana has some of the most expensive car insurance in the United States for a number of different reasons.

why is louisiana car insurance so highTypically, the most expensive states aren’t there because they have more bad weather or bad drivers than other states. Instead, the most expensive states are on the list because residents frequently make expensive auto insurance claims.

Typically, states with bad weather and dangerous driving conditions tend to have more claims than states with good year-round weather.

In addition, states with more rural residents tend to have cheaper car insurance than more urbanized states. City drivers make far more claims than rural drivers.

None of this, of course, explains Louisiana’s high insurance prices. It doesn’t snow in Louisiana. There’s no ice to create slippery driving conditions. There are also only 4 cities in Louisiana with more than 100,000 residents (New Orleans, Baton Rouge, Shreveport, and Lafayette).

So why does Louisiana pay more for car insurance than other similar states?

To answer that question, we turn to USA Today, which recently interviewed insurance industry analysts to determine why Louisiana is such an expensive state.

According to those industry analysts, Louisiana has a unique problem: it doesn’t have winter weather, nor does it have a highly urbanized population. Instead, Louisiana has a large number of bad drivers who make big claims and sue each other in front of friendly judges. This leads to high insurance payouts. In response to these payouts, insurance companies are forced to raise rates.

Just How Much Does Car Insurance Cost in Louisiana?

The following table shows the average auto insurance rates in Louisiana by age group:

AgeAverage Annual Car Insurance Rates
16$11,617
17$9,723
18$8,350
19$5,181
20s$2,944
30s$2,116
40s$2,062
50s$1,896
60s$2,090
70s$2,157

The following table shows the average auto insurance rates in Lousiana by city/town:

RankMunicipalityAverage Annual Premiums
1Leesville$2,830
2Minden$2,870
3Ruston$2,900
4Deridder$2,920
5Natchitoches$2,990
6Bossier City$3,070
7Patterson$3,120
8Thibodaux$3,130
9Franklin$3,160
10Jennings$3,220
11Houma$3,220
12Crowley$3,250
13Oakdale$3,280
14Sulphur$3,280
15Mandeville$3,310
16Bastrop$3,310
17Rayne$3,310
18Shreveport$3,350
19Eunice$3,370
20Covington$3,390
21Bogalusa$3,440
22New Iberia$3,450
23Abbeville$3,460
24Ville Platte$3,580
25Slidell$3,580
26Ponchatoula$3,590
27Lake Charles$3,600
28Breaux Bridge$3,610
29Carencro$3,650
30Broussard$3,660
31Youngsville$3,670
32Hammond$3,690
33Pineville$3,690
34Monroe$3,700
35Lafayette$3,720
36Donaldsonville$3,790
37Alexandria$3,800
38Plaquemine$3,870
39Walker$3,960
40Gonzales$3,990
41Marksville$4,000
42St. Gabriel$4,000
43Denham Springs$4,030
44Addis$4,050
45Central$4,220
46Baker$4,260
47Baton Rouge$4,380
48Kenner$4,490
49Gretna$4,940
50New Orleans$5,630

Louisiana Drivers File More Bodily Injury Claims than Drivers in Other States

You might think that states with winter weather would have higher insurance rates than states with warm year-round weather like Louisiana.

However, Louisiana has more bodily injury claims than many other states – and bodily injury claims cost insurance companies a lot of money.

A high portion of Louisiana drivers involved in car accidents will file bodily injury claims. All car accident lawsuits for less than $50,000 will go before elected judges. These judges – at least in Louisiana – tend to side with consumers more often than insurers.

Other studies point to Louisiana’s large numbers of bad and irresponsible drivers. Louisiana is one of the worst states for accident frequency.

Louisiana has another serious problem: nearly 14% of Louisiana drivers are uninsured. They drive without liability insurance. About 40% of drivers are underinsured, carrying just the minimum liability coverage required by state law.

The end result is a perfect storm of costs for insurance companies: Louisiana drivers get into accidents more frequently than drivers in most other states. And, when they get into accidents, they like to sue people involved – including other drivers or the insurance company. Many of these drivers cannot afford to cover the costs involved, so insurance companies have to pay. Insurance companies then have to charge higher rates.

Final Word – Why Is Louisiana Car Insurance So High?

Louisiana has some of the highest insurance prices in the United States. In some years, Louisiana is ranked as high as number two on the list of most expensive insurance policies (behind only Michigan). It rarely falls out of the top 5 states in terms of car insurance prices.

Louisianans don’t pay more because of winter weather or bad driving conditions: they pay more because they get into more accidents than most other states. Louisiana also has more uninsured or underinsured motorists than most other states. That means higher costs for insurance companies – and more expensive plans for drivers.

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