A Guide to Kentucky Insurance

Fran
Dani Milton
April 8, 2021

Kentucky is known for its majestic beauty, mouthwatering Southern cuisine, and internationally famous bourbon distilleries. The Bluegrass State also gave birth to one of the world's renowned horse races – The Kentucky Derby - held at the historic Churchill Downs Racetrack. The state has a vibrant music scene and some of America's most scenic National Parks.

Many Kentucky residents use their vehicles to visit the state's cultural and natural hot spots. It is still one of the best ways to see the area.

The Bluegrass State requires its residents to have car insurance at all times when riding on their winding highways. But auto insurance and health insurance coverage can be expensive. How can drivers in Kentucky save money while getting the best deal on their auto insurance coverage? Comparing car and health insurance in Kentucky from different companies in your city can help you save. For example, you can get a quote using SmartFinancial's tools. You can compare rates, view coverages, and pick the car insurance company that's right for you and save money. You can do the same, comparing Health insurance quotes for the best deal in your area.

In this article, we'll tell you how to score cheap car insurance in Kentucky.

What Is the Average Cost of Car Insurance In Kentucky?

The price of auto insurance in Kentucky is higher than in other areas. The national average for car insurance is $565 for minimum coverage and $1,674 for full coverage.

According to SmartFinancial research data, the average monthly rate for car insurance in Kentucky is $120 per month or $1,440 annually.

Why Is Kentucky Car Insurance So Expensive?

If you're a driver in Kentucky, you probably realize that insurance rates in your state are higher than other places. There are several reasons auto insurance in Kentucky is more expensive.

The state has increased its car insurance requirements. Kentucky has established higher car insurance requirements than other states, so insurance is higher.

More drivers on the road. Kentucky residents are driving more, which causes the accident rate to increase. The state's traffic fatality statistics are higher than the national average. There are 1.36 deaths per 100 million miles driven in Kentucky.

Repair costs are more expensive. According to Car MD, Kentucky made the top 20 for states of the average check engine-light-related car repairs in 2018. From its most recent stats, the area was ranked 17th in the nation, up from the 22nd position. The average cost of parts and labor was $390.02.

There are more uninsured drivers in Kentucky. According to a study conducted by the Insurance Research Council, Kentucky ranked 8th nationwide for states with the highest number of uninsured drivers. Almost 17.6 percent of Kentucky drivers were uninsured. Mississippi was the state with the most uninsured drivers at 28.0 percent.

Healthcare costs are higher in Kentucky. Auto insurance companies have paid out more claims involving medical insurance. Healthcare spending in Kentucky increases by 6.2 percent every year.

The region has more severe weather. Kentucky is already prone to severe thunderstorms and heatwaves; however, their numbers have increased over recent years. It has resulted in more of the state's residents filing claims. Since car insurance companies use your city's zip code to determine rates, it has resulted in higher rates.

How Kentucky Car Insurance Companies Calculate Your Rates

Most drivers in Kentucky want to find out how to get cheap car insurance and save money on their premiums. How do businesses calculate your rates?

These insurers use personal factors like your driving record, age and credit history to determine your rates. The Insurance Information Institute has named several metrics that companies use to calculate your premiums.

  • Your Driving History – If you're a good driver with a clean record, you will pay lower insurance rates. Insurers generally give price cuts to people who have fewer traffic violations, accidents, and speeding tickets on their records.

  • How Much You Drive Your Car – Commuters pay higher rates than those who work from home. You'll pay lower premiums if you only use your car for pleasure use.

  • Location – Insurers use your home city to determine how much you'll pay for car insurance premiums. They charge city residents higher auto insurance premiums than those who live in small towns. They will consider where you park your car. If you have safety features on your vehicle, it could lower your rates.

  • Age – Car insurance companies charge mature drivers lower rates than their younger, less experienced counterparts. Teenagers and drivers younger than 25 years old pay higher premiums for coverage in Kentucky because insurers view them as riskier.

  • Gender – Your gender only influences your auto insurance rates when you are young. On average, teen male drivers pay significantly higher premiums. It changes as they age. On average, women pay slightly less than their male counterparts. They also have fewer driving-under-the-influence accidents than men.

  • Your Vehicle Model – Insurers also consider your automobile's make and model to calculate your rates. If your vehicle has an impressive safety record, your rates will plummet. If your vehicle model has a poor safety record, it will increase your premiums.

  • Your Credit History – Another metric that car insurance companies use when calculating your rates is a credit-based insurance score. Research studies have shown that individuals with lower credit scores file more claims.

Kentucky's State Minimum Auto Insurance Requirements

The Kentucky Legislature has passed several laws to reduce the number of uninsured motorists in its state. Owners who do not get adequate auto insurance in Kentucky can face serious consequences. The state will cancel their registrations if they cannot show proof of coverage. Kentucky asks motorists to carry minimum liability insurance and no-fault protection before they register their vehicles.

The state has the following requirements for car insurance.

  • Bodily Injury Liability - $25,000 per person and $50,000 per accident

  • Property Damage Liability - $10,000 per accident

  • Uninsured Motorist Coverage - $25,000 per person and $50,000 per accident

  • Personal Injury Protection (PIP) - $10,000 per accident

Bodily Injury Liability (BI) - BI covers medical expenses for another driver if you're liable for an accident. Kentucky requires 25/50/25 coverage in their state but purchase higher amounts to carry more protection for yourself, your family, and your assets. Under BI, this insurance will also cover your attorney's fees if another driver sues you.

Property Damage Liability (PI) – In an accident, this Kentucky car insurance will pay for any damages you cause to another driver's vehicle or property. Most claims pay for replacement parts.

Personal Injury Protection (PIP) - Kentucky is a no-fault state. Its Motor Vehicle Reparations Act (KRS 304.9) requires all drivers to carry basic PIP coverage for all motor vehicles except motorcycles. The car insurance company must pay these expenses if a covered driver accidentally hits another car or pedestrian, regardless of who was at fault in the accident. Kentucky allows drivers to accept or reject PIP coverage through writing.

Uninsured Motorist Bodily Injury Liability (UMBI) – This car insurance pays for injuries you receive if an uninsured motorist hits your vehicle. A similar coverage, Underinsured Motorist Bodily Liability, covers your expenses when a driver with inadequate car insurance hits your vehicle.

Uninsured Motorist Property Damage Liability (UMPDL) – This car insurance covers you when an uninsured motorist destroys your vehicle. Underinsured Motorist Property Damage Liability pays for repairs when a Kentucky driver (with inadequate coverage) hits your vehicle.

How Does the DMV Verify Your Car Insurance in Kentucky?

Kentucky has a program that uses the Vehicle Identification Number to check drivers' auto insurance in a statewide database. If the coverage doesn't match, the state will require drivers in Kentucky to verify their car insurance within 30 days.

These coverages mentioned above only provide the bare essentials, and if you have an at-fault accident, the other driver's damages could exceed these limits. Purchase a policy that will offer enough auto insurance in Kentucky to keep you and your assets safe.

If you need cheap car insurance that fits your budget, use SmartFinancial's insurance tools to help you get a quote from different car insurance companies within your area. You can compare rates and find coverage that is right for you. Research has shown that shopping around for your coverage in Kentucky can save you a significant amount of money.

Alternative Car Insurance for Kentucky Drivers

The state has alternative options for drivers in Kentucky who cannot get insurance on the voluntary market because of a bad driving record or other convictions. The Kentucky Automobile Insurance Plan (KAIP) was established in 1948 to provide basic coverage to eligible risky drivers that can't obtain coverage in the voluntary market. Auto insurance companies share the underwriting results and the plan's expenses.

  • KAIP isn't a competitive market – the applicant must be unable to get coverage in the voluntary insurance market.

  • If you apply for the program, you must contact an insurance agent to represent you with the plan.

  • The insurance companies provide all of the quotes for premiums.

  • The plans don't cover physical damages.

Additional Kentucky Car Insurance Requirements

The Bluegrass State has several insurance requirements that people have to follow.

New residents must register their vehicles within two weeks. According to statute KRS 186.020, Kentucky drivers have 15 days to register their cars within the county where they live.

Year-Round Car Insurance in Kentucky – Individuals must maintain year-round insurance for their vehicles. If drivers in Kentucky don't plan to keep their registration current, they must turn in their license plate to the County Clerk's office, so they cancel your insurance without penalty.

Seasonal Vehicles – Kentucky drivers who own seasonal vehicles like motorcycles or RVs generally drop their insurance on these vehicles when they don't use them. The state requires owners to turn in their license plates to their County Clerk's office before canceling their insurance in Kentucky. When they plan to use these them again, drivers in Kentucky can purchase another policy.

Graduated License Program for Teens – The minimum age to apply for a Kentucky graduated license program is 16 years old. All applicants under 18 must have a parent's signature and a School Compliance Form. Teen drivers must pass the state's written and vision test. All permit holders must be accompanied by a licensed driver 21 years or older.

They must hold the permit for 180 days (if under 21 years old) and 30 days (if older than 21 years old). Permit holders under 18 must complete 60 hours of practice driving, with 10 hours at night. For more information about Kentucky's program, visit this page.

The 10 Best Companies for Car Insurance in Kentucky

Many Kentucky drivers prefer reputable insurance companies that provide them excellent coverage and affordable rates. There are three research and accrediting agencies that have assessed the quality of car insurance companies within Kentucky.

J.D. Power – This Michigan-based company specializes in consumer intelligence and research studies. It also identifies trustworthy businesses that provide shoppers with excellent value and excellent customer service. Every year, the organization releases its U.S. Auto Claims Satisfaction Study to measure policyholders' satisfaction with insurance companies.

The National Association of Insurance Commissioners – This national support organization sets standards for the U.S. insurance regulators. It is a nonprofit, nonpartisan group that creates regulations for all 50 states, the District of Columbia, and five U.S. territories. NAIC maintains a Complaint Index that gathers information from the nation's insurance regulators. It evaluates each insurer's claims handling, denial of claims, underwriting and unsatisfactory settlement offers.

Here is a roundup of the scores from different accrediting agencies that can help drivers in Kentucky select a reputable car insurance company:

State Farm

  • 2019 NAIC Complaint Index – 0.66
  • 2020 J.D. Power Claims Satisfaction rating: 881

Kentucky Farm Bureau

  • 2019 NAIC Complaint Index – 0.50
  • 2020 J.D. Power Claims Satisfaction Rating – (Not Listed)

Allstate

  • 2019 NAIC Complaint Index – 0.71
  • 2020 J.D. Power Claims Satisfaction Rating – 856

Geico

  • 2019 NAIC Complaint Index: 1.01
  • 2020 J.D. Power Claims Satisfaction Rating: 871

Liberty Mutual

  • 2019 NAIC Complaint Index: 1.00
  • 2020 J.D. Power Claims Satisfaction Rating: 870

Erie

  • 2019 NAIC Complaint Index: 1.10
  • 2020 J.D. Power Claims Satisfaction Rating: 880

Auto-Owners

  • 2019 NAIC Complaint Index: 0.42
  • 2020 J.D. Power Claims Satisfaction Rating: 890

Shelter

  • 2019 NAIC Complaint Index: 0.51
  • 2020 J.D. Power Claims Satisfaction Rating: Not Listed

USAA

  • 2019 NAIC Complaint Index: 0.68
  • 2020 J.D. Power Claims Satisfaction Rating: 890

Travelers

  • 2019 NAIC Complaint Index: 0.65
  • 2020 J.D. Power Claims Satisfaction Rating: 861

Who Has the Cheapest Car Insurance in Kentucky?

There is a significant price gap between companies that provided the highest and lowest Kentucky auto insurance rates.

Ohio-based Westfield Insurance Company had the cheapest auto insurance rates in Kentucky, followed by low-cost standard-bearer USAA. Other affordable insurers include the Kentucky Farm Bureau, Motorists, Geico and State Farm.

Here is a select list of low-cost premiums from other insurers:

Average Annual premium for Minimum Coverage

Average Annual Premium for Full Coverage

Allstate

$1,036

$3,515

Electric Insurance Company

$842

$2,702

Grange

$833

$1,709

Kentucky Farm Bureau

$397

$1,754

Metlife

$1,842

$3,726

Motorists

$443

$1,914

Nationwide

$720

$2,150

SafeAuto

$996

$2,523

State Farm

$477

$1,540

USAA

$376

$1,466

Westfield

$361

$1,724

To view other insurers' Kentucky auto insurance coverage, you can use SmartFinancial's tool to check insurance rates against other competitors.

Average Coverage Costs for Car Insurance in Kentucky

The cost of your car insurance premium will depend on how much coverage you maintain. The cheapest coverage is liability-only coverage. In general, the lower your deductible is, the more money you will pay.

Here are the different rates for coverage within Kentucky:

Coverage and Annual Rates

  • $100K/$300K/$100K Bodily Injury/Property Damage – Liability Only - $1,231
  • $100K/$300K/$100K Bodily Injury/Property Damage - $1,000 Comprehensive/Collision - $2,128
  • $100K/$300K/$100K Bodily Injury/Property Damage - $500 Comprehensive/Collision - $2,328
  • $50K/$100K/$50K Bodily Injury/Property Damage - Liability Only - $1,123
  • $50K/$100K/$50K Bodily Injury/Property Damage - $1,000 Comprehensive/Collision - $1,953
  • $50K/$100K/$50K Bodily Injury/Property Damage - $500 Comprehensive/Collision - $2,152
  • State Minimum - Liability Only - $984
  • State Minimum - $1,000 Comprehensive/Collision - $1,848
  • State Minimum - $500 Comprehensive/Collision - $2,052

Are your premiums higher than average ones for Kentucky drivers? You can use an insurance comparison tool, like SmartFinancial's, to find an affordable insurance quote that's right for your budget. You can compare coverage and find the best plan for yourself or your family members.

The Average Car Insurance Costs for Kentucky Drivers Based on Gender

Your gender won't significantly influence your auto insurance rates. Your age and zip code have a greater impact on your premiums. Nationwide, this factor affects men when they are younger. Both sexes generally pay the same rates as they age. In the state, female drivers in Kentucky pay slightly higher rates than their male counterparts.

Kentucky Auto Insurance Premiums Based on Gender

Male
Average Annual Premium: $2,069.20

Female
Average Annual Premium: $2,111.50

What Are the Average Rates for DUI Insurance in Kentucky?

Driving Under the Influence (DUI) refers to individuals that operate vehicles while intoxicated by alcohol, drugs or other substances. Kentucky drivers convicted of DUIs can pay fines. Other penalties include a possible suspension of their state driving license and prison time.

A DUI conviction can raise annual auto insurance premiums by $1,293 for drivers in Kentucky. It is 14 percent higher than the national average after a DUI conviction.

Kentucky DUI Stats

  • Average Annual Rate without a DUI - $2,217
  • Average Annual Rate with a DUI - $3,502
  • Percent Increase After a DUI - +58%

United States DUI Stats

  • Average Annual Rate without a DUI - $1,557
  • Average Annual Rate with a DUI - $2,565
  • Percent Increase After DUI - +65%

The Cheapest Kentucky Insurance Companies for DUI Insurance: State Farm

Kentucky drivers who receive DUIs should consider their coverage options before buying an insurance policy. The six companies with the most affordable rates are State Farm, Liberty Mutual, Kentucky Farm Bureau, and Allstate.
Here is a list of selected rates from national insurance companies in Kentucky.

State Farm

Average Annual Rate after a DUI - $1,526

Liberty Mutual

Average Annual Rate after a DUI - $2,732

Kentucky Farm Bureau

Average Annual Rate after a DUI - $2,896

Allstate

Average Annual Rate after a DUI - $4,267

Ten Kentucky Cities with the Cheapest Car Insurance Rates

According to a SmartFinancial study, ten cities have the cheapest insurance rates for Kentucky drivers. Covington residents paid the lowest rates at $107.54 per month. Other cities with the lowest auto insurance premiums in Bluegrass State were Latonia ($108.08) and Ashland ($114.69).

1Covington, KY$107.54/month
2Latonia, KY$108.08/ month
3Ashland, KY$114.69/ month
4Hopkinsville, KY$117.47/ month
5Bowling Green, KY$117.94/ month
6Owensboro, KY$119.29/month
7Henderson, KY$119.77/month
8Paducah, KY$120.19/ month
9Somerset, KY$120.90/month
10Danville, KY$122.05/ month

Do you live in a city with higher-than-average premiums? You can use insurance technology, like SmartFinancial's Quote Comparison to get an affordable insurance rate. These tools help you to compare coverage and find cheap car insurance premiums that fit your budget.

How Much Does Car Insurance Cost Per Month in Kentucky?

Which insurance company provides the most affordable rates? According to SmartFinancial's research, here is the average monthly rate from each car insurance company. The prices of insurance quotes may vary.

RankCarrierAverage Monthly Rate
1USAA$102.58
2State Farm$107.28
3Kentucky Farm Bureau$114.92
4Westfield$145.03
5Cincinnati Insurance$152.35
6Motorist Mutual$152.69
7Safeco$164.69
8Travelers$187.48
9State Auto$192.56
10Allstate$227.72
11Grange Mutual$242.89
12Electric$229.80
13Safe Auto$242.89
14Nationwide$247.26
15Shelter$293.19
16Metropolitan$329.59
17Encompass$773.86

Cheapest Insurance for Drivers with One Accident

A single accident can dramatically impact your car insurance rates. Kentucky drivers who are involved in a recent accident can see their rates increase by 48 percent.

The average annual premium for a Kentucky driver with an accident can vary depending on the provider. Most insurance companies will consider you as a high-risk driver for 3-5 years following an accident.

Since Kentucky insurers may penalize you with higher rates, it's essential to shop around for the best rates from different insurance companies.

Some insurers will not raise your rates significantly. State Farm provided the cheapest rates for drivers in Kentucky with one accident. Do you need cheap car insurance after your recent accident? Here are rates for at-fault drivers with one accident from different insurance companies.

  • State Farm: $560 per year
  • Kentucky Farm Bureau:$716 per year
  • Auto-Owners: $789 per year
  • Travelers: $847 per year

Average Auto Insurance Prices in Kentucky By Credit Score

Insurance companies use a credit-based insurance score to calculate your car insurance rates. Studies have shown that drivers with good credit are more dependable clients and file fewer claims. Individuals with poor credit or bad credit may file more.
Kentucky drivers with outstanding credit can save $2,782.40 per year on their auto insurance rates compared with a driver who has a less favorable credit score. Here are how insurance costs differ based on credit level.

  • Very Poor (300-579) - $4,558.26

  • Fair (580-669) - $3,599.27

  • Good (670-739) - $2,787.37

  • Very Good (740-799) - $2,199.01

  • Exceptional (800-850) - $1,794.00

Are you a person with a poor credit score who needs cheap car insurance? If so, it pays to use tools like SmartFinancial to get a quote from different insurance policies for free. It can help you get coverage that meets Kentucky's state minimum requirements.

How Can I Lower My Car Insurance Rates in Kentucky?

Local insurance agents can help drivers in Kentucky save money on their car insurance premiums. They can tell drivers about discounts that can help them lower costs. Many insurers, like Allstate, and State Farm offer multiple discounts to customers.
Insurance companies that provide the most discounts are:

  • Allstate
  • American Family
  • Farmers
  • Geico
  • Liberty Mutual
  • Nationwide
  • State Farm
  • Travelers
  • USAA

Accident-Free and Good-Driver Discounts- If you have had a clean driving record for five years, you may qualify for one of these cost savings. Geico, Allstate, and State Farm offer this discount to customers. In some cases, the insurance company will automatically apply it to your premium.

Safe Driver Discounts – Insurers ask you to install a telemetric device to track your behavior on the road. Individuals with a clean driving record and great habits can save 10 percent on their insurance premiums.

Low Mileage and Usage-Based Savings – Most Americans drive an average of 12,00 miles each year. If you only put on 7,500 or less on your odometer, you may qualify for this discount.

Driver Status Discounts – Your insurance company may give you a discount based on different group affiliations, employment or school accomplishments. These include statuses like Good Student, Military Member, Professional Affiliations and Seniors.

Policy Insurance Discounts – Your insurer may award you a discount based on your payment habits. These include using electronic billing, paying in full, and loyalty discounts. You can get other savings by bundling your auto insurance with other policies like homeowners coverage.

Seven Additional Tips to Lower Your Rate

Most Kentucky drivers want to find ways to lower their insurance premiums. Saving money on your car insurance rates can be used for other things like bills, groceries, or even a night on the town. If you're There are several things you can do to lower your car insurance premiums in Kentucky.

1. Comparison Shop for Better Rates. If you're looking for more affordable rates or better coverage, it pays to spend a few minutes comparing rates between insurers.

It can help you find an insurer that provides better coverage at more affordable rates. You can use an insurance comparison search engine like SmartFinancial to simplify the process and connect you with an agent in your city. To get started, fill out your zip code and answer a few questions.

2. Consider Regional Insurers. An insurance company in your local area gives better rates for similar coverage as the national insurers. They provide exceptional customer service and more perks.

3. Consider Pay-Per-Mile Insurance. This coverage is also known as low-mileage or pay-as-you-go auto insurance. It provides full coverage, including standard liability, collision and comprehensive, but it charges you by the mile.

4. Drop Comprehensive or Collision Coverage. Do you own an older model vehicle that is worth less than the cost of its repairs? Have you paid off an auto loan to your lender? If you need to save some money, you can drop collision and comprehensive insurance. These two coverages pay for repairs to your vehicle after an accident.

5. Fix Your Bad Credit Score. In many states, insurance companies can use your credit scores to determine your auto insurance rates. You can improve your credit score by paying your bills on time and reducing your debt.

6. Research Insurance Rates Before Buying a Car. Are you in the market for a new car? Take a few minutes to research the vehicle's average insurance rates. If you prefer, you can consider automobiles with lower premiums to cut costs. To see how different vehicles rate for insurance, visit here.

7. Raise your deductible. A deductible is a cost you share with the insurance company. It is the amount you'll have to pay before your auto insurance coverage kicks in. Your premiums will decrease if you opt for a higher deductible on your policy.

What Health Insurance Is Available in Kentucky?

The average cost of health insurance in Kentucky for 2021 is $478 for a 40-year-old person. It is a 3 percent increase from the 2020 fiscal year when the monthly cost was $463.

Although Personal Injury Protection can cover some of your medical bills, it may not pay all of them if you have a serious accident. Catastrophic injuries, like spinal cord damage or head trauma, can require expensive medical treatments and long-term rehabilitation.
There are a variety of healthcare options available in Kentucky.

The Affordable Health Care Plan has several tiers that can fit your needs and financial situation. There are three tier levels.You can compare health insurance rates to get the best value.

  • Gold Plans help individuals that have high expected insurance costs. It's 19 percent more expensive than a Silver Plan.

  • Silver Plans are better for individuals who have average medical costs and needs.

  • Bronze and Catastrophic Plans are better for younger, healthier individuals who may have fewer medical issues. Bronze plans only cover 60 percent of your medical costs.

The Kentucky Medicaid Program – This governmental insurance coverage is another option for low-income individuals. The income limit for this program and the resource limit is $2,000 per individual. If a person's income exceeds $217, spend-down eligibility may apply.

Short Term Health Insurance – This temporary medical insurance option provides healthcare coverage as you search for a permanent plan. It is a better option for younger, healthier individuals who don't have chronic conditions that require ongoing medical assistance.

What Is Considered Low-Income in Kentucky?

For many low-income families, auto insurance is essential, yet expensive. This coverage can cost most families hundreds of dollars each month. Additionally, this insurance policy will prevent you from paying out-of-pocket if you have an accident.

Unfortunately, Kentucky doesn't offer access to state-subsidized insurance for its poor residents. The only states that provide these policies are New Jersey, California and Hawaii. You can lower your rates by using insurance search engines to compare rates as SmartFinancial has. Additionally, take advantage of discounts that insurance companies provide.

How does the state define the term low income? According to the National Center for Children in Poverty, they are families with incomes below $50,200 for a family of four with two children. According to the organization, 46 percent (454,202) of Kentucky children live in low-income families. The national average is 39 percent.

Do you need help finding auto or health insurance coverage from an affordable company? Using tools, like SmartFinancial, can help you find the best rates from local insurance companies. We provide a list of premiums and available coverages in your area. To get started searching for better rates, enter your zip code and answer a few questions. You can get a quote from insurance companies in your city within minutes.

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