UNITED STATES—Each state has its own rules and regulations relating to car insurance, and while there is plenty of crossover from region to region, there are also some key differences that it’s worth knowing about.

Let’s go through the most important points to keep in mind so that you can get the best car insurance deal without misunderstanding your obligations as a motorist.

Finding the cheapest car insurance in your state

Before we go further, it’s worth noting that wherever you live, you can still compare policies and deals via sites like Cheap Insurance.

Rather than choosing the first package you find, or sticking with your current insurer year after year, you have a right as a consumer to see what the rest of the market has to offer, and you could make major savings as a result.

Weather conditions matter

Car insurance costs are calculated according to a number of factors, some of which are based on the driver and the vehicle, while others are specific to the location in question.

Florida and Louisiana are good examples of this latter point, since they are both states in which extreme weather events such as floods and storms occur more frequently. This in turn means that car insurance claims are more common, which bumps up premium prices for owners living there.

Uninsured drivers can be prevented from making compensation claims

A total of 10 states, including Alaska, California and Oklahoma, have laws in place which are designed to deter uninsured drivers by essentially rendering them powerless to claim compensation if they are involved in an accident with an insured motorist.

This applies even if the party with insurance was to blame for the crash, which is obviously not ideal, but does incentivize all car owners to pay for cover.

Insurance is a legal requirement almost everywhere

The majority of states enforce minimum insurance requirements on all drivers, and while these can differ, there are only a couple of places where you are not legally obliged to pay for cover.

First up is New Hampshire, where the only expectation is that if you injure someone or damage property while behind the wheel, you are responsible for paying compensation. 

Obviously this means that insurance is still a good value proposition, but it does leave drivers at liberty to take risks by being uninsured if they wish.

Second is Virginia, where you can pay a flat fee of $500 to register your vehicle as uninsured, and face the full consequences of any incidents without needing a specific insurance policy if you so choose.

Again, in either case car insurance is still better than the alternative, but knowing all the options available may be useful for some.

Some states ban insurers from using credit score to calculate insurance premiums

One sticky issue for many drivers is that insurers are allowed to consider customer credit score when working out how much to charge them for cover each year.

Thankfully this is not a universal practice, as a small but growing number of states have either outlawed this altogether, or dramatically reduced the amount of weight that this has in calculating premium prices.

California is the leader of the pack in this regard, and it has been 18 years since it banned credit scores from being a factor in car insurance. 

This also applies to a greater or lesser extent in Hawaii, Massachusetts and Michigan, and there are signs that other states could follow the same path in the near future.

The best advice is to do your research and read the small print of any insurance policy so that you understand how your state’s laws apply to you.