Why Louisiana has the Nation’s Most Expensive Car Insurance

Louisiana is known for many things, including hurricanes, jazz, political corruption, Cajun food, and the nation’s most expensive car insurance. The average Louisianan pays $2,700 a year in car insurance premiums in contrast to the average resident of New York State that pays $1,369 a year.

So why is car insurance so expensive down on the Bayou? There are two different yet related theories that explain Louisiana’s high premiums:

The first is that Louisiana residents file more bodily injury claims than people in other states. Bodily injury claims drive up car insurance premiums because they cover the cost of medical treatment. As we all know, the cost of healthcare has been skyrocketing in recent years.
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Louisiana’s Legal System Is Stacked against Insurers and Drivers

The second is that it is easier to win lawsuits against drivers in Louisiana than in other states, which can lead to more insurance payouts. It’s easier to win lawsuits because suits for less than $50,000 in Louisiana are settled by a judge and not a jury.


Judges are elected in Louisiana, so they are more likely to rule on behalf of local people that vote than insurance companies. Judges are also more likely to pay attention to local personal injury attorneys that write campaign donation checks than insurers.

The two factors are related because people are more likely to file claims when they know that they can win. Personal injury attorneys are more likely to take cases because they know they can get a payout.

How Poverty Drives Up Car Insurance Premiums

Poverty might play a role in driving up Louisianans’ insurance premiums. The high cost of car insurance means that there will be more uninsured motorists on the road. When there are a lot of uninsured drivers on the road, the cost of uninsured motorist coverage for the responsible drivers goes up.

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Another factor that drives up insurance premiums is the lack of health insurance. People without health insurance are more likely to file injury claims because they have no other way to pay medical bills after an accident.

Natural Disasters Contribute to Insurance Costs

The many natural disasters that strike Louisiana also play a role in driving up insurance premiums. More disasters lead to more comprehensive insurance claims for damaged and destroyed vehicles.

It looks like drivers in Louisiana just cannot win; several factors conspire against responsible motorists that live in that state. The only thing that could truly lower car insurance rates would be reform of the legal system. Unfortunately, the large number of attorneys serving in the state legislature in Baton Rouge will probably prevent that from happening.

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