Why Is Auto Insurance so Expensive in Denver?

Last Updated on December 9, 2020

Colorado is one of the more expensive states for car insurance, particularly if you live in the Denver metro area. While Denver is considered a very desirable city right now, the rising cost of living can make things difficult for some residents, and that includes the high price of car insurance. Car insurance rates have gone up dramatically in Colorado over the past few years – here are some of the reasons why, and what you can do to find affordable car insurance.

Population Growth

auto insurance so expensive in denverDenver has experienced steady population growth over the last decade, and understandably so. The city is very appealing to young professionals, with jobs available in many different sectors and plenty of fun recreational activities at your fingertips. The city is teeming with trendy bars and restaurants, and skiing, hiking, and other outdoor activities are a short drive away. It makes sense why so many people want to move here, but with this population growth means more cars on the road. When there are more cars on the road, there are bound to be more accidents, which puts everyone in the city at a higher risk. Higher population density also means increased chances of auto theft and vandalism. While Denver is a relatively safe city, when you put a large number of people close to each other, the frequency of these crimes is going to increase. This increased risk means that insurance companies are receiving more claims every year, and they’re charging drivers more to offset it.


Another reason why Denver drivers are seeing rate increases is because of the erratic weather in the area. Throughout the year, Denver sees intense snowstorms and hailstorms, and there’s often a threat of tornadoes in the summer as well. We’re starting to see the effects of climate change now, which means that these weather patterns are consistently getting more intense. These intense weather patterns can cause severe damage to your car. Hailstorms are particularly dangerous, often leaving huge dents in cars and cracking windshields. Snow and ice on the roads can also make it much more challenging to drive, resulting in many more accidents each year.

How Can I Lower My Insurance Premiums?

If you live in Denver, you may be wondering you how can lower your car insurance premiums. Since the cost of living in the area is already so high, the last thing you want is a huge car insurance bill on top of your rent and other bills. There are several things you can do to lower your premiums – here’s what to keep in mind.

  • Be a responsible driver. You may not be able to control what other people are doing on the road, but you can control your own driving. The cleaner your record is, the lower your premiums will be, so you should always be careful when you’re behind the wheel. One of the best ways to reduce your chances of getting in an accident is to avoid driving distracted. Never text and drive, and make sure your passengers understand that your first priority is always going to be focusing on the road. Never drive after you’ve been drinking, smoking marijuana, or taking medication that could alter your psychological state.
  • Avoid filing insurance claims unless you have to. If you have a minor accident and you can pay for the repair out-of-pocket, do so. Every time you file an insurance claim, your premiums are going to go up, so sometimes it makes more sense to pay a one-time repair bill than to pay a higher premium for months to come.
  • Look into pay per mile insurance. There are some companies that are now offering usage-based insurance, which charges you based on the distance you drive. If you don’t drive often, this could potentially be a good option for you. Denver has a reliable public transit system that is rapidly expanding. You may want to consider living by a light rail or bus stop and using your car only on weekend trips. With usage-based insurance, you’ll pay much less for using your car less.
  • Shop around. Premiums vary widely from company to company. Look at both national and local companies, and compare quotes to see who can offer you the best deals. Consider the overall value of the policy, not just getting the lowest price. You should also make sure you’re asking every company about the discounts they offer and let them know you’re shopping around. They may be willing to lower your rates in order to secure a new customer.

The combination of a quickly growing city and extreme weather events means that car insurance is often more expensive in Denver than it is in other parts of the country. Make sure you’re shopping around and looking for discounts to keep your rates affordable.

James Shaffer
James Shaffer James Shaffer is a writer for InsurancePanda.com and a well-seasoned auto insurance industry veteran. He has a deep knowledge of insurance rules and regulations and is passionate about helping drivers save money on auto insurance. He is responsible for researching and writing about anything auto insurance-related. He holds a bachelor's degree from Bentley University and his work has been quoted by NBC News, CNN, and The Washington Post.
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