Why is Car Insurance so Expensive in Miami?

Last Updated on October 12, 2020

Miami drivers pay for more auto insurance than the rest of those living in Florida as well as other drivers throughout the rest of the United States.  Though auto insurance rates have spiked across the entirety of the nation in recent years, Miami drivers have been hit particularly hard. Even Miami drivers with flawless driving records are receiving auto insurance renewal notices with premium hikes in the range of $200 to $700 per year.  In some cases, Miami drivers end up paying two times as much for auto insurance as they paid in the year prior. Those with imperfect driving records and those who lack driving experience are paying ridiculous sums of money to insure their vehicle while driving in Miami. The question begs: why is it so expensive to insure an automobile in Miami?  There are several answers to this question.

Heightened Road Risk is Part of the Problem

If you were to walk on over to a busy Miami intersection and observe traffic, you would likely find at least one-quarter of all drivers looking down while waiting at the stoplight.  Miami drivers are notorious for multitasking while behind the wheel. Sadly, many of these drivers are distracted by their smartphone or another mobile computing device. Furthermore, the low cost of gas combined with the robust economy has also contributed to the increase in traffic throughout the greater Miami area.  Increased traffic means more collisions, more auto insurance claims, and higher auto insurance rates for all Miami drivers.

Miami’s Harsh Weather is Also Responsible for Auto Insurance Rate Increases

Miami has a particularly high number of auto insurance claims partially because the city’s weather patterns are becoming more unpredictable and violent as the planet warms.  Torrential downpours, strong winds, and other nasty weather events have caused many more accidents in southern Florida. Though losses related to weather events do not spur auto insurance hikes right away, the financial pain is felt in the ensuing months and years.  Auto insurers take massive losses from hurricanes, harsh storms, and other violent Miami weather so it only makes sense they raise the auto insurance rates for Miami customers.

Miami’s High Rate of Fraud

why is car insurance so expensive in miamiThere is an elevated frequency of personal injury protection (PIP) fraud in the greater Miami area.  These scammers have defrauded nearly a dozen auto insurance companies out of nearly $24 million in the past decade.  Florida is one of the 15 states in the nation that requires PIP insurance protection. PIP insurance covers expenses related to injuries, lost wages, and other damages causally related to auto accidents.  This no-fault system and subsequent scams really have played an integral part in sending Miami auto insurance rates through the roof.

Though PIP insurance usually increases the average Miami driver’s auto insurance premium by a mere $15 or so per year, the prevalence of PIP fraud and subsequent payouts sends auto insurance premiums higher-and-higher for all Miami drivers.  Sadly, there is no way for moral and rule-abiding Miami drivers to opt-out of this mandatory auto insurance.

Miami has More Criminal Activity Than Other Areas

The rate of motor vehicle theft is particularly high in Miami. Miami has more auto thefts than every other Florida city but for Jacksonville.  All in all, just under 2,000 vehicles were stolen in the greater Miami area in 2017 alone. The sad truth is the level of criminal activity in a driver’s area really does affect his or her auto insurance rate. The increased likelihood of auto theft spurs higher auto insurance premiums as the insurance provider is taking a considerable risk to insure the vehicle in question.  Alternatively, those who live in comparably-safe Key Biscayne pay less for their auto insurance simply because there is a lower chance of auto theft, vandalism, and accidents.

Miami has Its Fair Share of Reckless Drivers

Miami’s prevalence of DUI convictions, reckless driving tickets, and other comparably high traffic violations are partially responsible for its absurdly high auto insurance premiums.  Furthermore, the state of Florida is rated as the second-worst in terms of distracted driving. It is clear Miami drivers are not completely focused on the road. This reckless behavior really does justify higher auto insurance rates.  The injustice of the situation is those who obey the rules of the road when behind the wheel end up paying higher-and-higher auto insurance rates year-after-year to account for the mistakes made by their fellow careless drivers.

If you are angered by the fact that you have to pay higher monthly auto insurance premiums simply because your fellow Miami drivers are reckless, it is time to take action.  Shop around, compare different coverage levels from the litany of auto insurance providers and you will eventually find a lower rate. However, the most important thing you can do to keep your Miami auto insurance premium in check is to avoid accidents and traffic tickets.

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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