Car insurance for someone who has never previously owned a car?

[jfer_rose]

I am interviewing for a job that has great appeal to me, based in Detroit. I currently live in Washington, DC. I'm trying to anticipate what it would cost to live there should I be offered and accept the job. Because you know, I don't want to have to work that job forever.

The good news is that housing costs have the potential to be much lower in Detroit so I think I could save a lot of money there. But I am very concerned about another area: transportation. I have never owned a car but I think I might want one if I moved to Detroit. I am committed to not living a clown-car lifestyle and a top priority would be finding a home within bikeable distance to work. But I think having a car will make it easier for me to visit my family throughout the state.

My initial research is scaring the daylights out of me. Apparently, Detroit has some of the highest auto insurance rates in the nation. Not only that, but I've never owned a car. When trying out online unofficial quotes, I was asked to enter how many years I have been currently insured. Since I've never had a car, or car insurance, I entered 0. The quotes for insurance varied from $800 to more than $3,000 per month!!!! If that were the case, having a car in Detroit would not even be an option for me. If I say I have had insurance for 10 years or so, some of the "quotes" came down to $400 per month, which is still enough to undo most if not all of the housing savings.

Can anyone shed any light on this situation for me? Does getting your first car at 37 doom you to high insurance rates since you've never had car insurance?

Should I be offered the job, I don't yet know what the salary would be but I know that the top range in the listing is lower than my current salary. Cost of living calculators suggested that would be okay but now I'm not so sure.

Thanks in advance for your thoughts!

[Jouer]

If you have never had a car or insurance, you will be treated like a 16 year old for the first few years (brand new drivers have higher premiums). Best bet is to get an older car and get collision insurance only.

Those numbers seem very high though. You sure it was per month?

[jba302]

Rant explanation incoming, because it's not just you:

Michigan is the closest state in the country to a pure no-fault system*. This means that if I drive my Pinto into your Maserati, I pay for my pinto and you pay for your Maserati. It sounds very simple, but consider the ramifications of this from a rate-making perspective. I (I actually do this, so I can say I here) have to consider every driver of every vehicle in your area and rate you based on what the collective risk is of that area / zip code / whatever. I no longer care that you are a safe driver, because I can't consider subrogation against the at-fault party if you are hit by someone else. I can't consider that your years of experience are making you less risky, because you are driving on a road littered with assholes.

What makes this even worse is the amount of fraud that happens as a result. Anyone can basically get hurt anywhere, drive their $1,000 car into a tree, and suddenly their auto policy has become their health insurance and we end up paying for a $250,000 fusion surgery and a decade of pain pills. It happens all-the-damn-time.  So much so that my company is pulling out of Michigan entirely because of how hard it is to be profitable.

* - The only conditions where this is not applicable is significant injuries and death. Otherwise, this basically holds.

[jfer_rose]

Those numbers seem very high though. You sure it was per month?

Yup. The price for six months of insurance was also listed but I don't dare repeat those here for fear of making myself sick.

[jfer_rose]

Rant explanation incoming, because it's not just you:

Michigan is the closest state in the country to a pure no-fault system*. This means that if I drive my Pinto into your Maserati, I pay for my pinto and you pay for your Maserati. It sounds very simple, but consider the ramifications of this from a rate-making perspective. I (I actually do this, so I can say I here) have to consider every driver of every vehicle in your area and rate you based on what the collective risk is of that area / zip code / whatever. I no longer care that you are a safe driver, because I can't consider subrogation against the at-fault party if you are hit by someone else. I can't consider that your years of experience are making you less risky, because you are driving on a road littered with assholes.

What makes this even worse is the amount of fraud that happens as a result. Anyone can basically get hurt anywhere, drive their $1,000 car into a tree, and suddenly their auto policy has become their health insurance and we end up paying for a $250,000 fusion surgery and a decade of pain pills. It happens all-the-damn-time.  So much so that my company is pulling out of Michigan entirely because of how hard it is to be profitable.

* - The only conditions where this is not applicable is significant injuries and death. Otherwise, this basically holds.

You make a lot of sense. Yikes, what a crazy situation! I can't believe it is such an auto-dominated state in these circumstances.

[jda1984]

Rant explanation incoming, because it's not just you:

Michigan is the closest state in the country to a pure no-fault system*. This means that if I drive my Pinto into your Maserati, I pay for my pinto and you pay for your Maserati. It sounds very simple, but consider the ramifications of this from a rate-making perspective. I (I actually do this, so I can say I here) have to consider every driver of every vehicle in your area and rate you based on what the collective risk is of that area / zip code / whatever. I no longer care that you are a safe driver, because I can't consider subrogation against the at-fault party if you are hit by someone else. I can't consider that your years of experience are making you less risky, because you are driving on a road littered with assholes.

What makes this even worse is the amount of fraud that happens as a result. Anyone can basically get hurt anywhere, drive their $1,000 car into a tree, and suddenly their auto policy has become their health insurance and we end up paying for a $250,000 fusion surgery and a decade of pain pills. It happens all-the-damn-time.  So much so that my company is pulling out of Michigan entirely because of how hard it is to be profitable.

* - The only conditions where this is not applicable is significant injuries and death. Otherwise, this basically holds.

How does this work out in the case of cyclist/auto accidents or auto/other property accidents? 

[JLee]

If you have never had a car or insurance, you will be treated like a 16 year old for the first few years (brand new drivers have higher premiums). Best bet is to get an older car and get collision insurance only.

Those numbers seem very high though. You sure it was per month?

Liability only? Collision will not satisfy mandatory insurance requirements.

[jba302]

How does this work out in the case of cyclist/auto accidents or auto/other property accidents?

BI liability would cover the cyclist and PD liability would cover the property damage. They are required coverages since there are instances where you can be responsible for other people - significant injury / death is the big one, also if you hit an out-of-state vehicle.