A new CarInsurance.com report finds major U.S. cities separated by miles—but divided by thousands in annual car insurance costs.
A new report from CarInsurance.com reveals that car insurance premiums across the United States can vary by more than $3,000 a year between neighboring cities, underscoring how geography, not just driving records, can shape what motorists pay to stay insured.
The study, titled “The Most Expensive Cities for Car Insurance in 2025 (and the Cheapest),” found that drivers in Detroit, Michigan, and New Orleans, Louisiana, face the steepest annual premiums in the nation. At the other end of the spectrum, Vermont remains the most affordable state for car owners, thanks to its low population density, minimal traffic, and low crime rates.
Researchers found that even short distances can mean big differences in costs. For example, drivers in Brooklyn, New York, pay an average of $3,012 more per year than those in nearby Jersey City, New Jersey, despite the cities being just a few miles apart.
“Car insurance rates aren’t just about your driving history — your ZIP code plays a major role,” said Laura Longero, executive editor of CarInsurance.com. “Location-based risk factors, such as crime rates, congestion, and local laws, can have a bigger impact on premiums than many drivers realize.”
The report also notes a growing concern over so-called “insurance deserts,” areas where rising climate risk and high claim rates have caused insurers to hike prices sharply or exit local markets altogether.
CarInsurance.com’s analysis ranks the 25 most expensive and cheapest cities for car insurance in 2025 and highlights the 10 cities where premiums have increased the most in the past two years.
Longero said the findings serve as a reminder that understanding how local risk factors affect premiums can help drivers make more informed insurance decisions — and potentially save hundreds each year.
