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When Your Auto Insurance Drops You

Written by Michele Wilmonen. Posted in Research Last Updated: 04/05/2011

Why insurance companies drop clients, what you can do if you are dropped and when it is just time to go to a different company.

Young insured getting a insurance being dropped letter

The bad news of cancelled insurance usually comes from a letter.

The jaw drop is a classic reaction to the letter that you are currently reading in your hand right now. The letter is from your insurance company and they have decided to not renew your policy. You may have had too many accidents, too many tickets or any number of reasons could be listed on that letter.

So what do you do when your auto insurance drops you?

Why Insurance Companies Drop Clients

When we talk about insurance companies dropping a client it is not in regards to your policy being cancelled because you didn’t pay your premium. A client that has been dropped by an insurance company gets a letter from the company that something has changed about the client or their driving record that the company doesn’t like and now they no longer wish to insure them.

The most common reasons for a client being dropped is too many accidents or too many points on their driving record from citations and accidents. Other reasons can be your credit score has become too low, there are too many high risk drivers in your home or you have been late paying your bill too many times.

What Can You Do if You are Dropped

If you get a letter from your insurance company that they are dropping you, read the letter very carefully to find out why. Then call the insurance company to speak to them about the reason. If they are dropping you because of too many accidents, request that they tell you exactly what they found on your CLUE report. The CLUE report is the report that insurance companies use to verify the number of and nature of accidents that someone has been in. CLUE reports are notorious for being wrong so make sure that they are dropping you based on correct information. If the information on your CLUE report is wrong, you will have to contact the company that submitted the information.

A letter stating that you have too many points on your driving record also needs to be verified to make sure that the citations and points on the record are correct. If they are not, contact the DMV that reported the information to your record. No matter the reason always verify that the insurance company is dropping you based on accurate information.

Moving On After Being Dropped

After checking to make sure that all of your information is correct and that there is nothing left to be done to stop from being dropped, it’s time to move on. Start calling around to your local insurance agencies to get quotes and also to insurance companies directly – or get quotes on our website.

Be honest as to why you are looking for new insurance and as to what is on your record. These new companies are going to pull up the same reports that your old company pulled up when they dropped you so there is no use in hiding information.

You will find that each insurance company has different criteria that they insure people under and your new company may be a little more forgiving than your last one.

2017 Auto Insurance Rates by State (updated)

Written by Michele Wilmonen. Posted in Rates, Research Last Updated: 08/13/2017

How the crime rates, number of uninsured motorists and the weather in your state can determine your auto insurance premiums – plus car insurance rates by state.

Moving this car to a different state will change its insurance premium

This vehicle will see a change in its insurance premium if it moves from one state to another.

The price of auto insurance is determined by many different factors. It can go up or down depending on your age, driving record, credit score, the type of car you drive and also your gender. But, did you know that how much you pay for car insurance also depends on where you live?

When an insurance company sends a request for the base premium for a state or specific area to the state Insurance Commissioner, they are using the statistics of claims filed or potential for claims being filed in a location. They want to make sure that they are not going to pay out more in claims payments then they are going to be collecting in premium. So if a certain location has a higher chance of having a claim, they want to make sure that they are charging a high enough premium.

Crime Rates

The crime rate in your state can have an impact on your insurance premium, specifically car thefts and vandalism. If you live in a state where you have a higher chance of getting your car stolen or damaged, the higher your insurance premiums will be to offset the claim payout of having to fix or replace your vehicle.

Liberal Monetary Awards

We have all see commercials for personal injury lawyers advertising their services to obtain financial compensation for those that have been injured in an accident. The high awards that these lawyers get for their clients end up increasing the premiums for everyone.

In the states that have judges that award higher monetary compensation and also have more lawyers advertising their services to help obtain these high awards, like Louisiana, they see the highest premium increases due to this factor.


You never know when Mother Nature is going to get ugly and cause damage. Statistically there are states, such as Oklahoma, that have a higher chance of seeing this happen than others and insurance companies keep track. States that are in “tornado alley”, flood prone states and severe weather states all have their premiums increased to compensate for the likelihood of a weather related claim.

Uninsured Drivers

Even though there are laws protecting those of us that are insured from them, uninsured drivers are everywhere. Not only are they a higher danger to us on the road, they are also one of the causes of our increased auto premiums. Because a driver that is not insured has no insurance company to pay for the damages that they cause, the victim’s uninsured motorist or collision coverage has to pick up the bill. This uncompensated claim payout then is spread out through all of that insurance companies customers for them to pay for in the form of higher premiums. Statistically some states have higher numbers of uninsured motorists driving up insurance premiums.

State by State Case (2017 updated)

While the insurance premiums can even vary within a specific state due to all of the above factors, there isn’t the room or the time to cover every single town and city across the nation. So instead we have provided the chart below for you to compare where your state stands in average premium rates.

National average $1,318
1 Michigan $2,394
2 Louisiana $1,921
3 Connecticut $1,897
4 Rhode Island $1,848
5 Florida $1,840
6 DC $1,696
7 California $1,673
8 Wyoming $1,538
9 Delaware $1,526
10 Texas $1,506
11 Oklahoma $1,476
12 Georgia $1,440
13 Arkansas $1,409
14 New Jersey $1,375
15 West Virginia $1,369
16 Kentucky $1,365
17 New York $1,352
18 Colorado $1,351
19 Arizona $1,348
20 Nevada $1,342
21 Maryland $1,327
22 Mississippi $1,326
23 Pennsylvania $1,313
24 Oregon $1,308
25 Hawaii $1,294
26 North Dakota $1,291
27 South Carolina $1,286
28 Massachusetts $1,242
29 Minnesota $1,241
30 Alabama $1,226
31 Montana $1,217
32 Washington $1,216
33 New Mexico $1,201
34 Kansas $1,192
35 Tennessee $1,186
36 Illinois $1,159
37 Wisconsin $1,154
38 Alaska $1,132
39 New Hampshire $1,124
40 Nebraska $1,112
41 Missouri $1,107
42 Utah $1,068
43 South Dakota $1,058
44 Virginia $1,040
45 Indiana $1,021
46 Iowa $1,017
47 North Carolina $1,010
48 Vermont $948
49 Idaho $942
50 Ohio $919
51 Maine $864


Most Expensive States , Least Expensive States (2011 data)

Most Expensive States

1. Michigan, $2,541

2. Louisiana, $2,453

3. Oklahoma, $2,197

4. Montana, $2,190

5. Washington, D.C., $2,146

6. California, $1,991

7. Mississippi, $1,896

8. New Mexico, $1,896

9. Arkansas, $1,836

10. Maryland, $1,807

11. North Dakota, $1,794

12. Connecticut, $1,786

13. Rhode Island, $1,747

14. Wyoming, $1,714

15. Hawaii, $1,707

16. South Dakota, $1,707

17. Georgia, $1,670

18. New Jersey, $1,663

19. West Virginia, $1,633

20. Kentucky, $1,629

21. New York, $1,627

22. Minnesota, $1,614

23. Washington, $1,584

24. Missouri, $1,563

25. Indiana, $1,518

26. Colorado, $1,508

Least Expensive States

1. Vermont, $995

2. South Carolina, $1,095

3. Maine, $1,126

4. Wisconsin, $1,128

5. Tennessee, $1,146

6. Ohio, $1,152

7. North Carolina, $1,154

8. Iowa, $1,179

9. Virginia, $1,237

10. Utah, $1,272

11. Arizona, $1,280

12. Illinois, $1,290

13. Nevada, $1,300

14. Oregon, $1,306

15. Alabama, $1,306

16. Idaho, $1,325

17. Massachusetts, $1,328

18. New Hampshire, $1,334

19. Alaska, $1,454

20. Kansas, $1,461

21. Pennsylvania, $1,468

22. Nebraska, $1,470

23. Florida, $1,476

24. Delaware, $1,489

25. Texas, $1,492

Data courtesy of

How to Cancel Auto Insurance

Written by Michele Wilmonen. Posted in Research Last Updated: 03/27/2011

What you need to do before you cancel your auto insurance, dealing with the left over billing and finally cancelling your policy.

A Cancelled Policy

Before cancelling your old policy, get new coverage in place.

Regardless of how long you have been with an insurance company, there comes a time that it is just better to say goodbye and to part ways. It could be because you are tired of paying such high insurance premiums.

It’s possible that the customer service you have had to deal with recently is not exactly friendly. No matter what your reason may be, you are not obligated to stay with your insurance company. But, before you cancel your policy for greener insurance pastures, there are certain steps in how to cancel auto insurance.

Shop Around Before you Cancel

If you are getting ready to blow a fuse due to the conversation that you are in the middle of with one of your insurance company’s rude call center agents, summon all of the strength you have left and refrain from yelling out, “Cancel my policy right now!” Instead calmly finish the conversation, hang up the phone and immediately start shopping around for a new policy.

Have a copy of your policy in front of you so that when you are getting quotes you can make sure that you are getting the price for the same exact coverage that you have now. If you don’t know your coverages, you may be getting a cheaper quote from a different company because they are quoting for less coverage. Also ask around to friends to see who they are insured with and find out what their customer service and claims experience have been like with their companies.

Settle the Billing Before you Cancel

Go back to your insurance company or agency and find out how your billing is set up.  If you are a “full pay” customer, you are paid in full until your policy comes up for renewal. If you are on a “two pay plan” or a “monthly payment plan” your insurance could be paid up to any date of your current policy term. If your insurance company or agent cannot tell you exactly what day you are paid up until; at least find out if you are paying ahead or behind on your policy.

Knowing when you are paid up until will help you decide when to cancel your insurance policy. You can opt to have the new policy start when the old policy expires instead of renewing it or if you want to leave the company right now, knowing that you are paying behind will prepare you for getting a bill for coverage up to your cancellation date.

Replacing Coverage Before Cancelling

Go back to the new insurance company that you decided to go with and purchase your new policy. You have now decided when you want it to start and you are ready to get it in place. This is a very important step as most states will track when you have cancelled your insurance and you can be fined or lose your license if you don’t get a policy to replace the one you have. By doing this all in advance you will save yourself the trouble of any of this happen.

Finally Cancelling Auto Insurance

Once your new policy is in place, contact your old insurance company and let them know that you want to cancel your policy and when. Most companies will cancel your policy for you over the phone, but some will require that you visit your insurance agent and sign cancellation papers. No matter what they require, just follow the directions that they give you and move on. It’s that simple.

What is an Accident?

Written by Todd Clay. Posted in Definitions Last Updated: 03/22/2011

Comprehensive, at-fault and not-at-fault auto accidents are all the different categories that help define a car accident.

A Tow Truck Needed for this Accident

A tow truck may be needed if you role-play a real accident.

We have all heard someone say that they have been in a car accident at one time or another.  But, what is an accident?

Is it just damage to their car, someone getting hurt or even just damage done to someone else’s property?  Per the Webster Miriam dictionary, the term accident means “an unforeseen and unplanned event or circumstance”.

In the world of insurance, these unplanned events fall under three different categories; Comprehensive Accidents, Not-At-Fault Accidents and At-Fault Accidents.

What it a Comprehensive Accident?

There is a difference between a comprehensive claim and a comprehensive accident.  A comprehensive claim is when you file with your insurance company that you have a rock chip or a broken windshield.  A comprehensive accident is when you hit an animal or even in some cases when the animal hits you.

Most comprehensive accidents happen when you are driving along the road and a deer jumps out in front of your vehicle and you hit it.  Even though this is technically a collision as you have “collided” with the animal, the insurance companies file this under your comprehensive coverage.  This is good for you because most people carry a lower deductible on their comprehensive coverage than they do for collision coverage, meaning you will pay less out of pocket to get your vehicle fixed.

What is a Not-At-Fault Accident?

Accidents that are covered under the collision portion of your policy fall into two categories; you are either at fault for the accident or you are not-at-fault.  A not-at-fault accident is when you are hit by someone or something else.  These types of accidents do not get counted against you on your driving record or on your insurance record.

What is an At-Fault Accident?

An at-fault-accident is just what it sounds like: you are the one that caused the accident.  These types of accidents go on both your driving record and your insurance record. This means you will most likely see not only the points go up on your driving record, but you will also see your insurance premium go up.  If you have too many of these types of accidents, your insurance company may cancel your coverage because you are too high of a risk for them to insure.

Even if you are not the main cause of the accident you could still be found at some percentage of fault in the states that have what are called Comparable Fault Laws.  These laws assign fault to both drivers if it is found that both drivers both did something to contribute to the accident.

For example, in a comparable fault state if you hit someone that pulled out in front of you, you could still be assigned a certain percentage of fault if you did not do everything you could to avoid the accident.  It could be that you weren’t paying attention and didn’t apply the brakes soon enough or that you were going too fast.  The percentage of fault that you are assigned will determine how much your insurance company has to pay for the amount of damages to your vehicle and how much the other company has to pay for your vehicle.

Full Coverage on an Old Car

Written by Michele Wilmonen. Posted in Research Last Updated: 03/21/2011

What is the definition of “full coverage”, should you drop it on an old car and what old cars should you drop it from.

An Old Car Past its Prime

It would be a good idea NOT to carry full coverage on this hunk of metal.

Sometimes there are investments that you make that are just not financially sound and having full coverage on an old car may be one of them.  Cars start losing their value as soon as you drive them off of the lot and the value just continues to decline from there.

There is a point in a car’s life that the cost to repair any damages that may happen to it actually exceeds the worth of the vehicle itself and when a car gets that old it may be time to stop paying for full insurance coverage.

What do you Mean “Full Coverage”?

When you hear people in the insurance industry talking about “full coverage” what they are talking about is the combination of your liability coverage and the property damage coverage for your own vehicle (comprehensive and collision).  So when some someone tells you that it may be not worth having full coverage on your old vehicle, they mean that it may not be worth having the Comprehensive and Collision coverage.  They are not telling you to cancel your whole insurance policy as you still need your Liability insurance no matter how old your vehicle may be.

Why Should I Drop Full Coverage?

When a vehicle is in a car accident the insurance company will compare the value of the vehicle to the amount of money it will cost to repair the damages to the vehicle.  If the cost of the damages exceeds a certain percentage of the value of the vehicle the insurance company will deem the vehicle a total loss and will pay you for the value of the vehicle. No matter how much you pay in insurance premiums for your vehicle the insurance company will never pay out more than the value of your vehicle (don’t forget they also subtract your deductible from this amount).

So if the value of your old vehicle is not very much, you need to sit down and compare how much you are paying in insurance premiums to keep Comprehensive and Collision coverage on you vehicle, to how much your vehicle is worth.

If the premiums exceed the value of your vehicle it may be a better financial decision for you to drop the full coverage and put what you would be paying for that premium in a savings account.  Then if you are ever in an accident you will have cash set aside to pay for the damages to your vehicle or for a down payment on a new car if your old vehicle is totaled.

By putting what you would be paying in premiums into a savings account, you are not only saving more money by keeping it instead of paying an insurance company more in premiums than what they are going to pay out for your vehicle, you will also be earning interest on this money.

Should Full Coverage be Dropped on All Old Vehicles?

Short answer: no. Full coverage should not be dropped on all old vehicles.  The age of the vehicle should not be the reason that you drop full coverage on a vehicle, but the value of the vehicle should be.   The reason that people refer to old cars not needing full coverage is that as the older a vehicle gets the less that it is worth.

The exception to this is classic cars.  Classic cars are vehicles that are so old that people start collecting them and restoring them back to the point that the vehicles value is increased.  These types of cars need to have full coverage on them to protect the money that has been invested in their restoration.

What Happens if I Drop Full Coverage on my Old Car?

If you drop full coverage on your vehicle your insurance company will not pay for any damages that you may have to your vehicle in the case of an accident.  This also includes damages caused by hitting an deer or any damages to your windshield as you will also no longer have Comprehensive coverage.

This means that you will have to pay for the damages out of your pocket and if you didn’t put aside the money that you had saved from dropping the full coverage on your vehicle, you may have to drive around a damaged vehicle or be completely without a vehicle if the car was totaled.

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Car Insurance Guidebook Unravels the Car Insurance Mystery

Unless you work in the car insurance industry, the topic is probably a mystery to you. The words deductible, comprehensive, collision, liability, premium, loss of use and bodily injury are all gibberish when they reach your ears.

Unfortunately, insurance is something that you are required to have by law if you want to drive. Because of how confusing it is many people go around in almost an insurance daze while they get car insurance quotes from the auto insurance companies that they have heard of. In reality, they are completely lost as to what they are actually buying.

Instead of looking at what each insurance company offers in the terms of protection for both themselves and their car, they are instead looking for cheap car insurance. Finding the cheapest car insurance coverage makes having to buy the required product all that much less painful, but misses the whole point of having insurance.

Learning about insurance through your insurance agent or websites like Car Insurance Guidebook will give you the upper hand when you looking for car insurance. You can take your knowledge and not only find the best price for insurance, you can use it to find really great insurance to protect you and your assets. Then you aren’t stuck settling for just average car insurance that can hurt you financially if you ever need it because there isn’t enough protection.

For example, when looking for insurance the car insurance rates are just the first of many factors that need to be taken into account when you are shopping around for car insurance. You also need to take into account the type of vehicle that you are driving. Many people don’t know this.

Are you driving around a vehicle that is a new sedan and can be protected under any blanket insurance policy? Or do you have an old car that you fixed up that needs special protection and could be better covered under classic car insurance?

Don’t just assume that when you compare car insurance that it will be a one-size-fits-all policy. This is where the insurance knowledge will come in handy; you will know what you need to protect yourself and your vehicle.

You will understand what your insurance agent is talking about when they use insurance terms and you will actually be able to make an informed decision. This is much better for you instead of the “nod and smile” approach people take in their insurance agent’s office.

Also just like your life changes your insurance needs will change. This year you may just need to learn about the best deductible to have. Next year you may need to educate yourself on car insurance for young drivers. As the years pass, motorcycle insurance may be something you will need to know.

Many wise people say that you never stop learning, so take their advice and educate yourself on the insurance that you spend a lot of money on and can’t get away with not having.