Why Is Car Insurance So Expensive in Maryland?

Last Updated on August 25, 2020

If you live in Maryland you might be asking yourself why you have to fork out so much annually for your car insurance. Unfortunately, car insurance requirements vary from state to state, with some areas requiring very minimal coverage and others requiring you to pay higher premiums for better protection. Maryland is one such state where minimum liability requirements are high and both personal injury protection and uninsured motorist coverage are required by law.

The average resident of the state of Maryland can expect to pay approximately $1,518 a year for full coverage insurance, which is a little more than the national average of $1,457.

Car Insurance Requirements in Maryland

Why Is Car Insurance So Expensive in Maryland?Since insurance requirements vary so much from state to state, if you live in a state like Maryland where better or more coverage is required, it makes sense that you’re going to end up paying more overall for your car insurance. Below are the state requirements for the insurance you need to carry in Maryland:

The minimum requirements in this state are pretty hefty, which is a big part of the reason why that insurance bill costs so much annually.

Other Reasons Why Maryland Has Such Expensive Car Insurance

Insurance Requirements – As mentioned earlier, Maryland requires drivers to carry personal injury protection and uninsured motorist coverage, which drives up the price of premiums.

Weather – Severe weather events like storms and flooding are becoming increasingly common in Maryland, which in turn is driving up insurance rates due to weather-related auto accidents. States with more inclement weather, in general, tend to have higher insurance premiums. Maryland experiences hurricanes, snowstorms, flooding, and occasionally tornadoes.

Uninsured Drivers – Unfortunately, those with insurance foot the bill for drivers who hit the road uninsured. Your rates are going to be significantly higher if you live in a state where there are a lot of people driving without coverage. In 2015, it was estimated that 12% of drivers on Maryland roads lacked even minimum liability insurance.

Increased Cost Of Auto Repairs – As the average cost of repairing a vehicle rises, so does what insurance companies charge drivers. With cars having more technology in them these days, repairs are getting increasingly more expensive. In Maryland specifically, the average cost of car repairs has increased by more than $200 since 2012.

Other Factors That Can Increase Your Insurance Rates

There are multiple factors that have an effect on the cost of your car insurance. Living in Maryland by default probably means you’re paying a bit more annually to insure your car than the national average, but there are other factors that can impact the amount you’re spending. By knowing what impacts your premiums, you can try to reduce what your insurance costs by as much as possible

  • Driving History – A clean driving record equates to lower premiums. It pays to drive safely and maintain a clean record. Insurance companies will reward you by taking less of your money!
  • Zip Code – The city and state where you drive plays into your insurance rates as well. Your zip code, however, plays the most important role. Living in crowded or urban areas are likely to result in higher premiums, whereas living in more isolated areas might mean lower rates.
  • Cities – In Maryland, the most expensive cities to live in for insurance are Baltimore, Owings Mills, Fort Washington, Silver Spring, and Waldorf. The least expensive cities to live in are Hagerstown, Frederick, Easton, Cambridge, and Denton. In Baltimore, you can expect to pay a massive $4,139 annually for your insurance, whereas a resident of Hagerstown pays an average of $1,791 a year. This shows the huge variation in insurance rates between cities.
  • Mileage – The average number of miles you are putting on your car annually plays a role as well. If you are driving hundreds of miles each week, there is more time that you are at risk. As a result, your rates are likely to spike. Some insurance companies are now offering insurance packages where you pay per mile driven rather than a flat monthly premium.
  • Claims History – This plays into your driving history, but if there are small claims that you can take care of yourself, it might be better to do so. Minor claims are unappealing to insurance providers. All insurers look at your claims history when determining your rates.

Cheapest Insurance Companies in Maryland

Shopping around for your car insurance and doing some research can seriously make a difference when it comes to how much you pay annually. It’s a good idea to take a look at a number of different auto insurance companies in your area to find out who can offer you the lowest and most competitive rates. If you want a head start, here are the car insurance companies that offer the cheapest rates in Maryland:

  1. Erie
  2. State Farm
  3. Allstate
  4. GEICO
  5. Progressive
  6. Nationwide
  7. USAA

If you are a high-risk driver, you might also qualify for the government-funded Maryland Automobile Insurance (MAI), which helps Maryland drivers who are unable to obtain insurance on their own. Not all auto insurance companies will offer coverage to high-risk drivers. The MAI, however, will not deny these applicants.

Final Word on Why Auto Insurance Is So Expensive in Maryland

In Maryland, a driver with the same profile living in the same area can pay a difference of as much as $1100 between the most expensive insurance rates and the least expensive insurance rates. That means you can save more than a thousand dollars annually just by shopping around for the car insurance that’s right for you.

Living in Maryland means strict insurance laws that require drivers to legally have better or more expensive coverage. This automatically means that you’ll likely end up forking out more annually for your insurance than the average person. Unfortunately, that’s something that’s out of your control as a resident of the state. But it’s not all bad, there are factors that you can control which could help reduce your insurance, and taking the time to shop around for a good deal could save you some serious cash.

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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