Best and worst states for car insurance rates

Want to lower your car insurance rates? Don’t move to the great-food state of Louisiana, which is also the state with the highest average premiums -- a mind- and budget-blowing $2,511 a year.

That compares with only $903 in lovely Maine.

• Compare premiums on 2010 models

So says a new study by Insure.com, an insurance shopping and comparison site. It also explains some of the reasons for the great disparity in car insurance rates state to state. Bad roads, population numbers and density, and the peculiarities of state law can be factors.

You can see where your state ranks (and an explanation of the study’s methodology) here (and a hat tip to Linda Stern, The Daily Money columnist at CBS MoneyWatch, for pointing the ranking out). The national average premium is $1,429, Stern says.

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After Louisiana, the states/areas in the top 10 for highest average premiums are: Michigan, Oklahoma, Montana (yikes!), California, South Dakota, Washington, D.C., Georgia, Illinois and Connecticut.

On the low side, after Maine, are Vermont, Ohio, Wisconsin, New Hampshire, Iowa, Massachusetts, North Carolina, Arizona and Tennessee.

Why insurance rates vary so much is partly because each state has its own insurance laws and partly due to local conditions.

Don’t blame Louisiana’s high premiums on Hurricane Katrina, says Insure.com. One factor is poorly maintained roads. Also:

In Louisiana, only cases with claims in excess of $50,000 receive a jury trial. "You see lots of settlements at $49,000," explains Duane Dimattia of Baton Rouge, a director of the Professional Insurance Agents of Louisiana. That sweetens the pot for seeking a claim against an at-fault driver -- and insurance companies pay the tab.

On the other hand, Maine residents generally live close to where they work, reducing commuting time. Roads are uncluttered, and insurance competition is healthy -- at least 30 companies are licensed to do business there. Plus, folks there pride themselves on not being very litigious.

The other example offered was Michigan. “Unlike any other state, it offers unlimited medical benefits for the life of accident victims -- no matter what policy they buy,” Insure.com says. Anything above $460,000 comes from a statewide pool, and that drives rates up.

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What’s a driver to do? Stern has some suggestions. You can also find savings tips at Insure.com. Among them:

• Drive a car that’s cheaper to insure. The Insure.com study was based on 2010 models.
• Raise the deductibles. The study used a $500 deductible for comprehensive and collision. I saved lots when I raised mine to $1,000. I could do that because I have an emergency fund.
• Get every discount possible. Sorry, folks, but often you have to ask for them. Compile a list -- bundled policies, safe driver, safe occupation, driving fewer miles, etc.  -- and call your agent or company.
• Shop around. Sites like Insure.com and Insurance.com make that much easier than it used to be.

Related reading:

• Which cars cost more (or less) to insure?
• Easy ways to save on car insurance
• 12 secrets your car insurance won’t tell you
• Who’s the better driver: Soccer mom or lawyer?