Why can't I get insurance?

Drivers in certain states are seeing few options

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Susan Meyer

Senior Editorial Manager

  • Licensed Insurance Agent — Property and Casualty

Susan is a licensed insurance agent and has worked as a writer and editor for over 10 years across a number of industries. She has worked at The Zebr…

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Ross Martin

Insurance Writer

  • 4+ years in the Insurance Industry

Ross joined The Zebra as a writer and researcher in 2019. He specializes in writing insurance content to help shoppers make informed decisions.

Ross h…

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Why car insurance can be hard to find

Both for legal reasons and peace of mind, car insurance is imperative. While not the most fun line item on your budget – especially as the amount you pay is always going up, it’s just something we accept as the price of admission for owning and driving a vehicle.

But…what if you can’t get it? In a number of places currently, insurance can be surprisingly hard to come by. If you’ve been searching for insurance and not finding anyone willing to take your money, here are some possible reasons.

Where you live

Where you live can have a huge impact on what you pay for car insurance. This risk pool party metaphor can explain some of the reasons why your insurance premium fluctuates down to the ZIP code. 

It’s not just the drivers around you that can impact what you pay. The state you live in is also a major factor. This is because insurance as an industry is regulated at the state level. 

According to the National Association of Insurance Commissioners, “State laws require insurers and insurance-related businesses to be licensed before selling their products or services. Currently, there are approximately 7,800 insurers in the United States. All U.S. insurers are subject to regulation in their state of domicile and in the other states where they are licensed to sell insurance.”[1]

So essentially, the lawmakers in your state dictate that rates:

  1. Must be adequate. Insurance companies need to make enough money to pay out all claims and stay in business. 
  2. Must not be excessive. Rates can’t be too high that people can’t afford them and the company makes huge profits.
  3. Must not discriminate. States allow insurance companies to take different rating factors into account. What’s allowed in one state might not be in another. 

Let’s look at two insurance markets to see why citizens of these states are having trouble finding insurance:

  • Because of California law Proposition 103, insurers have to get permission for rate increases from the state’s insurance commissioner. That makes it harder to raise rates.[2]
  • Factors like inflation and a greater number of accidents can make taking new business in California less attractive when the rates can’t be raised higher.
  • In addition to auto insurance, it is currently harder for Californians to get home insurance because the prevalence of wildfires is growing more common. Insurance companies like Berkshire Hathaway and AmGuard have pulled out of writing new policies in the state.[3]
  • Like California, Florida is prone to natural disasters (though hurricanes and flooding rather than fires). This makes it a less attractive market for insurance companies.
  • Some insurance companies are pulling out of the state all together, leaving fewer options for Floridians.[4]
  • Again, like California, the Florida home insurance market is undergoing its own crisis.

How risky you look

If you don’t live in one of the above states and you’re struggling to find affordable insurance, the problem also might be with you. Several factors can lead an insurance company to label you “high risk.”  Insurers deem you more likely to get in an accident or file a claim if you have a history of:

  • At-fault accidents
  • Speeding tickets
  • Reckless driving
  • Street racing
  • DUIs

There are also several non-driving factors that can make you look like a higher risk to insurance companies. These include:

  • Low credit (Note: Not all states allow credit scores as a rating factor)
  • Lapses in coverage history
  • Vehicle use

What you drive

One more factor that might keep you from getting insurance is what you drive. For example, very expensive cars or specialty cars are very expensive to fix. This can make them less attractive to cover to insurance companies. Car&Driver recently published a story about how even low-mileage Teslas are written off by insurance companies because they are just too expensive to repair.[5]

And then there are the cars like Kias and Hyundais that are facing rampant rates of auto theft. Many insurers are outright refusing to cover these cars because the likelihood they will be stolen is just too great.

What to do if you can’t get insurance

If you’re having trouble finding insurance, it can be frustrating. Here are some actions you can take.

If you are a high-risk driver and have been denied coverage by multiple insurance companies, you can join your state’s assigned risk pool or work with an insurance company that specializes in high-risk drivers. You should also take steps to improve your risk category such as taking a defensive driving course or repairing your credit.

If you are having trouble finding coverage because of where you live, look into state programs that may be able to assist you. For example, California has the FAIR plan specifically to help homeowners who can’t be insured by other means because they live in a wildfire-prone area.[6]

  1. State insurance regulation. NAIC

  2. Prop 103 Consumer Intervenor Process. California Department of Insurance

  3. Insurers pulling out of California. PropertyCasualty360

  4. Farmers Insurance pulls out of Florida. Kelly Blue Book

  5. Tesla EVs, Even Mildly Damaged, Are Being Written Off by Insurance Companies. Car&Driver

  6. California FAIR Plan Property Insurance