Rates

    Meridian motorists can be thankful for one thing – having one of the state’s cheapest rates for full coverage car insurance.

    A study by ValuePenguin.com said Meridian ranks ninth among the 45 Mississippi towns and cities they surveyed for the most affordable car insurance rates. On average, a Meridian resident pays about $1,100 a year for full coverage.

    The lowest per average premiums are in Starkville at $1,061 per year. The highest is in Belzoni at $1,537 per year. Natchez is the next worst at $1,311 and the capital city of Jackson is the third least affordable at $1,267.

    Ting Pen of ValuePenguin.com explained why the study was done and why there is as much as a $437 difference between insuring a car in Meridian compared to Belzoni, Natchez ($211) or Jackson ($167).

    “Our goal is to show consumers how much the cost of insuring a car can vary just based on where they live in Mississippi,” Pen said. “To that end, we analyzed auto insurance rates from nine insurance companies across 40-plus locations in Mississippi, including some larger cities and smaller towns. Rates were collected for two example drivers: a 30-year-old man and a 65-year-old man who each had a Toyota Camry.”

    Pen said several factors can determine the level of an insurance premium.

    “The key factors are historical frequency and severity of auto insurance claims in a location,” she said. “If there are fewer claims or claims for smaller amounts getting submitted in a particular location, this results in lower costs for insurers. This translates into overall less expensive rates for consumers there, since residents in that area are on average deemed less risky to insure compared to other places.     “There are other factors that correlate too, such as low population density and low levels of crime. The fewer people who live in one area, the fewer cars on the road and the lower probability for accidents to happen. The lower crime and motor vehicle theft rates, the lower risk that vehicles get damaged or stolen,” Pen said.

    Another factor cited by Meridian car insurance agent Nina Griffin from Acceptance Auto Insurance is the median income of an area.

    “I think it’s economy based,” Griffin said. “This is a low-paying wage area and I think wages are different in each part of the state. I think the number of DUIs are another factor.”

    Pen cited that Jackson’s crime level had a big effect in its higher premiums, and the higher number of accidents in Belzoni is what lifted that town to its high premium.

    “Jackson and Belzoni were some of the more densely populated locations that we analyzed,” she said. “When you have comparatively more people spread across a square mile or kilometer, there is more probability that accidents will happen. The higher crime rates in Jackson, also likely contributed too – violent crime and motor vehicle thefts per 1,000 were higher than some of the other places we looked at in Mississippi.”

    E. Bruce Martin of Meyer&Rosenbaum Insurance said the number of people fully covered by insurance can be another factor on rates.

    “Good people have the lowest rates,” Martin said. “Stable communities have significantly higher people that are fully covered.”

    Pen said the rates in Meridian do vary between companies.

    “In Meridian, our two benchmark drivers’ rates varied by as much as $810 from one company to another,” she said. “Put it another way, the rate from the most expensive insurer could have paid for two years at the cheapest insurer. Auto insurance companies all have their own claims experiences, algorithms and different weights of risk factors, so one company’s preferred customer might be different from one another.”

    Pen said the variance in rates within the state was the biggest surprise to her.

    “We found the annual premiums can vary as much as 48 percent or $475 just based on where drivers live in Mississippi,” she said. “The range between companies was also quite wide.”