Montana is the 4th most expensive state for auto insurance in the country, with premiums of $2,190 annually. Although many rural states have lower auto insurance than those with many metropolitan areas, Montana is a notable exception. There are many reasons why auto insurance is more expensive in Montana than in neighboring states, and by understanding why insurance costs what it does in the area, drivers can find ways to obtain affordable auto insurance in Montana.

Why is car insurance so expensive in Montana?

There are several factors that influence the cost of auto insurance in a state. The population, amount of traffic, weather, crime rate, DUI convictions and more all play a role in determining the cost of coverage. Car insurance companies set their rates by assessing risk. The higher the risk of a claim being filed, the more the coverage will cost. This risk applies to individual drivers as well as whole populations of drivers.

Car insurance companies also charge more for insurance as a way to recover funds that have been lost in claims. For example, if a large storm causes damage to thousands of vehicles in an area, the insurance company will raise premiums across the state to compensate for the lost money.

One of the biggest factors in determining the cost of insurance is the number of drivers in an area who do not have auto insurance. Uninsured motorists cause insurance companies to lose money by paying for claims without being able to recover those funds. When two drivers with insurance collide, the at-fault person’s insurance pays for both vehicles; when a driver without insurance hits someone with insurance, the insured driver’s company must pay for repairs without being reimbursed.

Montana has a relatively high rate of uninsured drivers, about 15 percent. Although not as high as other states, this population of divers does play a role the high cost of insurance in Montana. As insurance prices rise, more people are tempted to go without auto insurance, leading to ever-increasing premiums.

The primary reason that auto insurance in Montana costs more than in other states is because of the size of the state itself. The area is rural and drivers must travel long distances to go from one town to the next. This increases the amount of time a driver is on the road and multiplies his chances of being involved in an accident.

There is also no posted speed limit throughout much of Montana. This may be the cause of the high rate of traffic fatalities in the state; per 100 drivers, Montana motorists are twice as likely to be involved in an auto accident as drivers elsewhere in the country.

The high concentration of fatalities may be caused by the large quantity of deer and other animals throughout the rural roads. Single-car collisions are often more severe than other types of accidents. Additionally, 42 percent of all accident fatalities are caused by drunk driving in Montana.

Car Insurance Requirements in Montana

Drivers in Montana must carry a minimum of $10,000 in property damage liability insurance. All drivers must also include bodily injury liability coverage of $25,000 per person up to $50,000 per accident. These are fairly low liability limits, so it’s best to buy more coverage if you can afford it. Any time you’re in an accident that causes more damage than your insurance can pay for, you are responsible for paying the remainder out of your own pocket. Failure to do so could result in a lawsuit, criminal charges or suspended license.

For people with financed or leased vehicles, full coverage auto insurance is a necessity. Drivers who own their vehicles outright can choose whether or not to buy collision and comprehensive coverage. First-party coverage protects the insured vehicle from damage regardless of who causes the auto accident.

Drivers can also purchase uninsured motorist insurance and personal injury protection coverage. Montana is a tort state, meaning that drivers can file suit against other drivers for injuries sustained in an auto accident. Carrying first-party medical coverage is still a good idea for drivers who want instant assistance in paying for medical bills.

Other optional coverage in Montana includes rental reimbursement and towing coverage. These can be purchased separately from other coverage, whether or not a driver has full coverage auto insurance. By purchasing only the coverage a driver needs, he can ensure that his policy will protect him without costing more than necessary.

Whether you’re a resident of Montana or moving there from another state, you can get the best deal on auto insurance by comparison shopping online. Once you receive your free insurance quote, you can view dozens of companies that can provide coverage to suit your needs. A representative from the insurance company will contact you to discuss your specific policy coverage and answer any questions that you may have.

Auto insurance in Montana is more expensive than in other states, but your policy doesn’t have to be pricey. By customizing your coverage to suit your needs, you can cut down your insurance cost. You can also see if there are any discounts you can take advantage of that will help reduce the cost of your premiums each year.