Average Cost of Car Insurance in Minnesota

Minnesota’s 3.4 million licensed drivers pay an average of $881 for auto insurance each year, according to the National Association of Insurance Commissioners’ annual report.¹ The following factors affect policy costs in Minnesota:

• Additional coverage
• Age
• Gender
• Type of vehicle
• Mileage
• Driving record
• ZIP code
• Deductible
• Discounts

By City

Typically, drivers in larger cities pay higher auto insurance premiums. The higher costs are due to factors like congestion and incident rates. In Minnesota, we found the small city of Aurora (population 1,679) had a higher average auto insurance rate than the five most populous cities in the state at $2,040.² The state’s capital, Saint Paul, has an average annual rate of $1,802 and a population of 307,193

By Age

In general, inexperienced drivers have higher auto insurance premiums. That means that on average, teen drivers will have the highest auto insurance costs by far. In Minnesota, 16-year-olds can expect to pay more than double what most adult drivers pay for auto insurance.

By Model Year

In Minnesota, it costs slightly more to insure a new car than an older one.

By Coverage Level

You should always expect to pay more for full coverage than minimum coverage. In Minnesota, the average full coverage policy is more than twice the cost of a minimum coverage policy.

By Credit Score

In some states, the law prevents insurance companies from using credit score to determine auto insurance rates; however, that is not the case in Minnesota. You should expect to pay less the higher (better) your credit score is.

By Violation

Any traffic violation or ticket may impact your auto insurance rate; however, the most serious charges account for the highest difference. A DUI, for example, could double your auto insurance rate.

By Company

We found that Iowa Farm Bureau had the lowest average annual auto insurance cost in Minnesota. Other affordable coverage options include State Farm and American Family.

We found the cheapest auto insurance providers in Minnesota depending on your circumstances.

Like most states, Minnesota requires drivers to carry auto insurance at all times. It’s a cost you cannot avoid, however much you might like to. Even so, there are some basic ways to get the best deal on auto insurance:

1. Look for discounts. Almost every auto insurance company has a slate of discounts to reduce the cost of your policy.
2. Bundle policies with the same company. Typically, you get the steepest discount from using the same provider for auto insurance as your home insurance, renters insurance, or other policies.
3. Comparison shop. Check the market during each renewal period to ensure you’re getting the best deal.
4. Raise your deductible. If you need to pay less per month, you can always raise your deductible. This means you’ll pay more out of pocket before your policy kicks in.
5. Lower your coverage limits. As long as you drive with at least the minimum legally required insurance coverage, reducing coverage won’t impact your ability to drive, but it may increase your costs in the event of an accident.
6. Buy your car without a loan. If you have a car loan, your lender may require additional coverage such as collision and comprehensive.

Minnesota requires the following auto insurance minimums:

• $40,000 personal injury protection (PIP) medical coverage per person per accident
• $30,000 bodily injury liability for injuries to one person and $60,000 for two or more people
• $10,000 property damage liability
• $25,000 uninsured/underinsured motorist coverage for injuries to one person and $50,000 for injuries to two or more people³

Minnesota is a no-fault state. If you cause an accident, you are responsible for the other party’s property damage, not medical costs. Each party pays their own medical costs through their PIP coverage.

The Minnesota No-Fault Automobile Insurance Act requires residents and nonresidents to maintain basic economic loss benefits and liability coverage (PIP) on vehicles if registered, licensed, or principally garaged in Minnesota. The law also applies to nonresidents on any owned vehicle driven within the borders of Minnesota. Minimum no-fault coverage is $40,000 available to each person in an accident: $20,000 for medical and $20,000 for non-medical expenses.⁴ You must make claims within six months of an accident!

Two of the most significant factors in high auto insurance rates in Minnesota are age and driving record. Teens and drivers with an at-fault accident or DUI on their record should expect to pay much more than the average driver in the state; however, discounts and shopping around will get you the best deal.

We utilize a proprietary database of transactional data to determine which auto insurance companies transact with which types of consumers. We also consider demographic information and market research when determining the average cost of auto insurance per state.