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On average, Americans spend approximately $900 per year in insurance premiums. One of the most expensive states in the country, Arizona currently ranks 14th in insurance premium costs, with the average annual expenditure around $930. It seems rather steep, but compared with the top three: New Jersey, Washington D.C, and New York, which all boast annual premiums well over $1000, Arizona amounts to a small bargain. Furthermore, several carriers do not offer insurance to Arizona drivers at all, despite what one British gecko advertises.

When establishing rates, the insurer's primary goals revolve around generating enough revenue to pay operating costs and client claims. One vital method for accomplishing this is to assess risk to every potential customer; thereby charging higher premiums for higher-risk drivers (typically teenagers, unmarried young males, and senior citizens.) A second consideration is the inherent need to remain competitive in a consistently-expanding field.

In addition to the perceived risk of the driver, the type of vehicle plays a crucial role in assessing premium costs. Quite simply, some vehicles have a certain, shall we say, predisposition, to being driven in a manner that does not promote a sense of calm within other drivers. Furthermore, miles driven are taken into consideration; for example, someone who commutes 100 miles to work daily will incur higher rates than one who drives ten.

Like every other state, Arizona has specific requirements surrounding the limits and liabilities of automobile insurance. Currently, the minimum personal liability limits are $15,000 per person and $30,000 per accident; while the minimum liability for property damage is $10,000. Unfortunately, however, as these are the minimums as stated by law, oftentimes in the case of a serious accident, these amounts are insufficient and the party at fault is often subject to additional litigation.

Other financial factors to consider include coverage amounts and deductibles for comprehensive and collision, whether towing and/or roadside assistance is desired, and personal medical coverage. Comprehensive claims revolve around acts of God, vandalism, animal-caused accidents, and theft. Collisions, on the other hand, involve another motorist, a rollover accident, or collisions with other non-animal objects (i.e. vegetable or mineral.) Uninsured and under-insured motorist coverage is also vital to protect oneself from those who have not read this article. Arizona has a special class of comprehensive insurance for glass reimbursement due to a high volume and frequency of construction debris and rocks being forcibly hurled toward one's head. Most popular in this category is the zero deductible provision; one which I have used quite often.

Of course, the best strategy is to meet with one's insurance carrier and explore the options together.

Learn more about this author, Natalie Faulk.
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