We have all heard of a gender wage gap, but a car insurance premium gender gap, too? As it turns out, Michigan has a hefty one. On average, women paid $79 more every year than men in 2018 for the exact same automobile insurance. This is the second biggest gender premium gap in the country, Nevada being first at $121 difference.

Most states allow insurance agencies to offer these types of premium rate differences if they have reasonable support for the increased rate. An example of this is a female teenage driver, who is less experienced and more likely to have an accident than a male teenaged driver.

Insurance companies use as much data as they can to create these risk assessments and price their rates accordingly. Gender has been used as a data point for decades, and it’s completely legal. It basically communicates to the insurance company whether or not a certain gender is more or less likely to file a claim. The rates all come down to insurance claims.


Lady Putting Car Seat Belt Before Driving Close Up Belt Buckle Safe Drive Concept 1150 6569, Entrust Insurance St. Clair Shores, MI and Southeast Michigan

Although data shows men are a higher risk, women pay more

Research shows that even though they have lower premiums, men are higher risk drivers than women. The reason being? Men are more likely to speed, drink and drive, and drive without wearing a seatbelt. Men are also more likely to have a severe accident; however, females are more likely to be seriously injured or die in an auto accident. The bottom line for insurance companies is whether or not there is a claim, and how expensive is that claim.  

There is one theory that men do not file as many claims as women. This would be a huge factor in determining the premium shift.

Insurance Agent Writing Clipboard While Examining Car After Accident 1423 1729, Entrust Insurance St. Clair Shores, MI and Southeast Michigan

There are six states that ban the use of gender in auto insurance pricing. Those are California, Hawaii, Massachusetts, Pennsylvania, North Carolina and Montana 

Here is an example of an analysis performed: 

A 30-year old single driver with a 2014 Honda Accord EX and good driving history received:

Coverage limits:

$50,000 bodily injury liability per person

$100,000 bodily injury liability per accident

$50,000 property damage liability per accident

$500 deductible for comprehensive and collision

When that driver profile was changed to ‘female’ the rate was different.

What is interesting is that up until a few years ago, men paid more on average than what we are seeing now. The number of states where women pay more than men for the same car insurance coverage has more than doubled since 2016.

In states where men paid more for auto insurance than women in 2018, the widest gaps were in Wyoming, where men paid $47 more for car insurance than women; Rhode Island, with a $42 gender gap, South Carolina, with a $41 gender gap, and Georgia and Tennessee, which tied with $41 gaps.

A lot of states outlaw insurance premium determining factors such as credit rating, marital status or education. People have spoken up and demanded that insurance rates should only be based on driving. The Michigan no-fault auto insurance reform did not pass in 2017, although many leaders have pledged that changing the system is a top priority.

The most important thing you can do if you are looking for the best auto insurance rates in Michigan is to talk to a local insurance agent. A Michigan based car insurance agent can ensure you get the best quote, no matter your status or driving history. A local auto insurance agent will also shop all of the large companies for you, so you don’t have to do any of the work to find the very best insurance option.