For one, car insurance usually provides no material benefit to consumers until after they’ve been involved in an unexpected wreck, theft or disaster, and obviously, forecasting when those thing will happen is impossible.
But forecasting or predicting the perceived risk of any single driver is how car insurance companies make their profits, and based on data aggregated by The Zebra, Johnson City is the least-riskiest city in Tennessee to insure drivers.
For 2017, drivers living in the 37601 zip code of Johnson City paid $1,111 annually in car insurance premiums, while on the other end of the spectrum, drivers living in the 37611 zip code of Mooresburg, Tennessee, paid, on average, the most annually for car insurance at $1,201.
Each year, researchers at The Zebra, an online car insurance comparison marketplace, draft a report called “The State of Auto Insurance,” which explores how car insurance pricing all over the nation is affected each year.
“Car insurance rates are higher than they’ve ever been, with a national average premium of $1,427—that’s 20 percent higher than in 2011. Some U.S. cities have average rates of more than $6,000 per year,” the report for 2017 stated.
In the Tri-Cities metro area, rates have increased 34 percent since 2011, but the $1,150 annual average a driver in the Tri-Cities pays remains lower than the $1,315 state average and the $1,427 national average.
In addition to the 37614 zip code, Johnson City has three zip codes listed in the top five cheapest annual car insurance rates, with Bristol’s 37620 ranked second and Colonial Heights’s 37663 ranked fourth.
Blountville, Unicoi Kingsport and Telford also round out the top 10 cheapest Tennessee zip codes for car insurance.
“Really what it comes down to is how many claims are filed in those areas, and how do insurance companies perceive the risk in those areas,” Alyssa Connolly, director of market insights for The Zebra and author of the latest annual report.
“So it might be that, in Johnson City, there aren't that many claims being filed, so insurance companies don't have to pay out a lot in that area, so they keep their rates low or will occasionally lower them to stay competitive in that market.”
Although Tennessee is ranked 29th most expensive state for car insurance, its neighbor North Carolina is ranked the cheapest with a $865 annual average; Virginia is ranked second-cheapest with a $901 annual average.
“Tennessee gets a little bit of almost every type of weather, which is not great for comprehensive claims. Particularly damaging high winds and hail from various storms – summer and winter, tornadoes, and significant flooding – even wildfires,” Connolly said.
“One thing that might be different between Tennessee and Virginia is the amount of uninsured drivers. Tennessee has double the rate of uninsured drivers that Virginia has.”
While the rate of uninsured drivers has decreased slightly, Connolly said roughly one out of every five Tennessee drivers is not insured, which on average, contributes to higher car insurance pricing for everyone.
Dozens of factors contribute to car insurance pricing, including your driving record. As dangerous as texting while driving is, insurance companies can also raise your rate by nearly 16 percent, or $227 on average, for getting a distracted driving ticket.
Connolly shared the following tips consumers can follow to lower their insurance premium rates:
• Save up to 6 percent by maintaining continuous coverage with no lapses for at least six months. Connolly said even a single day of lapsed insurance could contribute to higher rates;
• Save up to 10 percent by purchasing a policy in advance, pay it in full or auto pay online;
• Save up to 11 percent by raising your deductible from $500 to $1,000;
• Save up to 8 percent by bundling your policy with home, condo or renters insurance;
• Save up to 17 percent by increasing your credit score by one tier; and
• Save up to 12 percent by purchasing an older car, even if it’s just five years old.
“There are a lot of things that consumers can do that they have a little more power than they think, and we really encourage them to take advantage of those opportunities,” Connolly said.
Consumers can visit https://www.thezebra.com/insurability-score/ and learn their “Insurability Score.” Similar to a credit score, the Insurability Score can tell consumers their individual level of risk and some of the factors that might contribute to that risk.