Cheapest Auto Insurance in Ann Arbor, Michigan (2024)

The average cost of liability insurance in Ann Arbor is $150 per month. This is lower than the Michigan state average of $184 but higher than the national average of $104.

Michigan drivers face expensive average rates for a few reasons, including a high percentage of uninsured drivers and high state insurance requirements.^[1] Ann Arbor has fewer instances of motor vehicle theft than some of Michigan's other largest cities, including Detroit, Grand Rapids, and Lansing. This can explain why residents pay lower rates on average.

Here’s what to know when purchasing your next car insurance policy in Ann Arbor, including how to compare quotes and coverage options.

3 of the cheapest car insurance companies in Ann Arbor

The best car insurance company in Ann Arbor won’t be the same for every driver. That’s because every insurer uses different criteria to determine the rates it offers. Though insurers in Michigan can’t consider factors like your gender, marital status, ZIP code, and credit score in calculating your rates, insurers do take into account your age, driving history, and other qualities that will vary from one driver to the next.

This is why it’s important to compare quotes from multiple insurers to find the best rate for your needs. As you start your search, look at coverage options from Auto-Owners, Chubb, and USAA. The quotes below reflect statewide average costs in Michigan.

Best insurer for cheap rates: Auto-Owners

Best insurer for luxury vehicles: Chubb

Best insurer for military members: USAA

How to get the cheapest car insurance in Ann Arbor

Car insurance companies in Michigan can no longer use your credit score, marital status, occupation, ZIP code, educational level, home ownership, or gender to set your premium rates. However, your driving history and age can still affect how much you pay for insurance.

Shopping around and comparing quotes remains an effective way to find the cheapest car insurance. You can also reduce your car insurance costs by:

• Maintaining a clean driving record: A driving record free of traffic violations, accidents, or other incidents is the most effective method of keeping low insurance costs.

• Bundling insurance policies: It’s common to get a discount when you purchase your homeowners or renters insurance from the same company insuring your automobile.

• Adjusting your coverage: Consider increasing your deductible, dropping collision or comprehensive coverage, or decreasing your liability amounts.

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Cheapest liability-only car insurance in Ann Arbor: Auto-Owners

If you cause an accident, liability-only car insurance pays to repair or replace the other party’s damaged vehicle and associated medical costs. This coverage goes above and beyond the personal injury protection included in the other party’s policy. If you damage your own car, however, your liability-only coverage won’t pay to repair or replace it.

Liability-only insurance is generally the least expensive coverage option, but it can leave you financially vulnerable because it doesn’t cover your expenses beyond personal injury protection.

The average cost of liability insurance in Ann Arbor is $150 per month. The following insurers offer the cheapest liability-only car insurance in Ann Arbor on average.

Cheapest full-coverage car insurance in Ann Arbor: Auto-Owners

Drivers looking for more protection than liability-only coverage provides may want to purchase full-coverage car insurance. This kind of insurance generally includes collision coverage, which pays to repair or replace your vehicle if it’s damaged in an accident you caused. It also includes comprehensive coverage, which pays to repair or replace your vehicle if it’s damaged because of something other than an accident, such as weather, theft, or vandalism.

If you lease a vehicle or obtain a loan to purchase one, your insurer will generally require you to carry full-coverage insurance. On average, Ann Arbor drivers pay $282 per month for full-coverage insurance. Compare full-coverage quotes from some of the cheapest Ann Arbor insurers below.

Car insurance requirements in Michigan

Michigan is a no-fault insurance state, which means your insurance pays to cover you through its personal injury protection clause, no matter who’s at fault in an accident. Your liability insurance will cover the other driver if their damages exceed their own personal injury protection coverage.

Under no-fault rules, drivers must carry the following types of coverage:

• 

  Personal injury protection (PIP)

  This coverage will pay for your medical bills and other associated costs (including loss of income) following an accident-related injury, regardless of fault.^[2] You can choose from multiple coverage levels for PIP insurance:

  • Unlimited coverage, which is the default option unless the insured driver chooses a different coverage level

  • Up to $500,000

  • Up to $250,000

  • Up to $50,000 for drivers enrolled in Medicaid

  • PIP medical opt-out, for drivers who have both Medicare Part A and Part B health insurance

• 

  Property protection insurance (PPI)

  This coverage pays for up to $1 million in damage your vehicle does to other peoples’ property while in the state of Michigan.

• 

  Residual bodily injury and property damage liability (BI/PD)

  This pays for damages, including your legal defense, if you hurt or kill someone in an accident. It also pays for property damage done to other peoples’ property while driving outside of Michigan. The BI/PD state minimum requirements are as follows:

  Coverage	Minimum Requirements
  Bodily injury liability	$50,000 per person and $100,000 per accident
  Property damage liability	$10,000 per accident (outside of Michigan)

Though the above table shows the state minimum requirements for BI/PD coverage, Michigan has set the default coverage limits as follows:

• Up to $250,000 for a person hurt or killed in an accident

• Up to $500,000 for each accident if several people are hurt or killed

• Up to $10,000 for property damage in another state

Unless you specifically decrease or increase these amounts, any insurance policy you purchase in Michigan will come with these limits by default.^[3]

Michigan insurance laws

The current auto insurance requirements in Michigan took effect July 2, 2020. Prior to the new insurance laws, Michigan required all drivers to carry mandatory comprehensive lifetime no-fault personal injury protection. Under the new law, drivers have a tiered choice of PIP coverage.^[4]

Additionally, the new law also increased the minimum amount of coverage drivers must carry for bodily injury liability. Under the previous law, drivers had to carry a minimum of $20,000 per person and $40,000 per accident. The new law requires a minimum coverage of $50,000 per person and $100,000 per accident.

Cheapest car insurance for drivers with an incident

Having incidents on your driving record can affect your car insurance premiums. Whether you have a speeding ticket, an at-fault accident, a DUI, or another traffic citation on your record, your insurance company may consider you to be a higher-risk driver and raise your rates. In some cases, your insurer may even drop your coverage altogether.

In the sections that follow, you’ll see how different incident types can affect the rate you pay for car insurance in different ways. The average cost of insurance for an Ann Arbor driver with a past incident is $184 per month for liability insurance and $345 for full-coverage insurance.

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Cheapest car insurance for drivers with a speeding ticket: USAA

Driving over the speed limit may be a common practice, but it’s still dangerous. The National Highway Safety Administration (NHTSA) found that 27% of Michigan traffic deaths in 2020 were speeding-related.^[5] That’s why even a single speeding ticket on your driving record can lead to higher insurance rates.

Ann Arbor drivers with speeding tickets pay $342 per month for full-coverage car insurance on average. If you have a speeding ticket, the following insurance companies offer the cheapest liability car insurance in Ann Arbor.

Cheapest car insurance for drivers with an at-fault accident: Auto-Owners

If you have an at-fault accident on your driving record, you may find it difficult to get cheap car insurance. This is because many insurers will consider you a higher risk after an accident and either raise your rates or drop your coverage, depending on the circumstances and severity of the accident.

An at-fault accident increases the average cost of liability insurance to $188 per month for Ann Arbor drivers. If you’re in the market for new coverage, the following insurance companies have the cheapest liability rates for drivers with an at-fault accident in Ann Arbor.

Cheapest car insurance for drivers with a DUI: Auto-Owners

The state of Michigan imposes severe penalties on anyone caught driving under the influence. A first offense will result in six points on your license. Depending on the judge’s discretion, you may also face the possibility of a hefty fine, some jail time, community service, or a suspension of your driving privileges.^[6]

In addition to the state-level consequences, you can also expect to see your insurance rates go up significantly. Your insurer may also drop your coverage entirely. Drivers with a DUI conviction are considered a much higher risk, which means they’re less likely to be offered insurance coverage by standard insurance companies. Several insurance companies specialize in coverage for higher-risk drivers, but their rates will typically be much higher.

Drivers with a DUI in Ann Arbor have some of the highest liability insurance costs at $218 per month, on average. If you need car insurance after a DUI citation, the following insurers offer the cheapest liability car insurance in Ann Arbor for drivers in your situation.

Cheapest car insurance for seniors: Auto-Owners

Age is the only demographic factor that insurers in Michigan can still use to set your car insurance rates. In general, insurers charge the highest rates to young drivers, in part because of their lack of experience behind the wheel. Rates tend to go down for adults around age 35 and stay low for safe drivers.

However, once senior drivers reach their 70s, insurance rates tend to go up again. That’s because reaching age 70 often coincides with a slowing of reflexes and response times, which increases the risk of getting into an accident.

The average monthly cost of car insurance for senior drivers in Ann Arbor is $133 for liability-only coverage and $250 for full-coverage insurance. Here, you can see the cheapest car insurance rates for seniors in Ann Arbor.

Cheapest car insurance for teens: Auto-Owners

Teenage drivers have the highest insurance rates of any age demographic. Their lack of experience on the road, paired with the higher likelihood that they’ll make risky decisions, means a higher chance of accidents.

That doesn’t mean teen drivers, and their parents, are stuck paying high premiums. Here are several strategies that can help lower car insurance costs for teens:

• Join your parents’ insurance. Although teens can potentially purchase their own auto insurance policy, it’ll almost always be cheaper and simpler for young drivers to join their parents’ policy.

• Choose a safe car to drive. Safe cars are less expensive to insure, and the Insurance Institute for Highway Safety (IIHS) has put together a list of safe, practical, and affordable vehicles suitable for teen drivers.^[7]

• Maintain a good GPA. Many insurers offer a good student discount to teen drivers who get good grades.

Teen drivers in Ann Arbor have an average monthly cost of $201 for liability car insurance and $377 for full-coverage insurance. The following insurance companies offer the cheapest policies for teen drivers in Ann Arbor.

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Is car insurance more expensive in Ann Arbor?

The average cost of insurance in Ann Arbor is $150 per month for liability insurance and $282 for full coverage. This is significantly higher than the national average cost of $104 for liability and $213 for full coverage. However, Ann Arbor drivers pay less on average than the Michigan state average of $184 for liability coverage and $345 for full-coverage insurance.

Michigan consistently ranks as one of the most expensive states for auto insurance. This is because of its no-fault insurance laws, which require all drivers to carry personal injury protection, property protection, and residual bodily injury and property damage liability. Additionally, the high cost of living in Ann Arbor may also affect the cost of full-coverage auto insurance since higher property costs generally increase the coverage needs for property protection.

More cities in Michigan

Ann Arbor’s car insurance prices fall in the middle of several Michigan cities, according to Insurify data. Compare average car insurance rates in different Michigan cities below.

Ann Arbor car insurance FAQs