Insurance makes up a substantial portion of the costs to drive a car, and the policy premiums depend on a variety of factors. Insurance companies use their own internal models to calculate premiums, assigning different weights to some factors over others. Additionally, each state varies somewhat when it comes to insurance laws and requirements, and it helps to know the state's minimum requirements and average auto insurance rates as a guideline when seeking auto insurance.
Washington State Requirements
Auto liability insurance covers damages, injury or death to the other parties in an accident but not the insured. Washington's auto insurance laws require liability insurance for all licensed drivers. Quotes for auto liability insurance read as a series of numbers, such as Washington's requirement for coverage levels of 25/50/10. This means the legally required liability coverage is $25,000 bodily injury coverage for one person in one accident; $50,000 liability for bodily injury total for one accident; and $10,000 coverage for destruction or damage to another's property in one accident. The state will also accept a deposit of $60,000 as collateral from a driver, or allow him to purchase a liability bond for the same amount or more in lieu of a liability insurance policy.
Primary Rate Determinants
Each state is responsible for setting its own auto insurance rates. For this reason, rates vary from state to state and this makes a person's home state one of the key factors in setting his insurance rate. For 2011, the most expensive states for drivers to have insurance are New York and New Jersey, with $2,703 and $2,347 insurance costs per year, respectively. Washington State falls in the middle of the spectrum, with $1,360 in annual insurance. Iowa, at $690 per year and Vermont at $901 per year, set the other end of the extreme with the lowest average cost of auto insurance.
Age is another determinant of insurance rates, as well as gender. According to the Insurance Institute for Highway Safety, almost 70 percent of fatal crash victims in 2007 were male. Additionally, males experienced more accident-related deaths in every age group as compared to females.
Secondary Rate Determinants
The car choice a consumer makes has an influence on her insurance rates as well. Some cars come with safety features such as airbags and anti-lock brakes, and this can garner discounts from insurance companies. Additionally, certain cars have better accident safety records and, according to Kiplinger's article "10 Cheapest Cars to Insure," minivans and SUVs are the best bet for lowering insurance costs. The Chrysler Town & Country LX had an average insurance premium of $1,092, and the Toyota Sienna was the runner-up with $1,101 in average premiums.
Insurance companies also look at a person's record of driving history. If an individual has one accident, they are more likely to have another and to present a higher risk in the eyes of insurance companies. Even one point on a record for a minor speeding ticket will cause an increase in rates, and points for traffic violations usually stay on a driver's record for three years. Certain violations, such as driving under the influence, add multiple points to a driver's record and have a substantial effect on insurance premiums.
Average Washington State Rates
Average insurance rates in Washington came out slightly higher than the national average for 2009 and 2010, although they have decreased each year for the past three years. In 2009, the average annual car insurance cost in Washington was $1,842. In 2010, the average rate declined to $1,626, and in 2011, the rate has actually fallen below the national average. Washington's average auto insurance for 2011 is $1,360, as compared to the national average insurance rate for 2011 of $1,433.
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