Updated on 06.20.16

Car Insurance in Tennessee

Kailey Fralick

A half hour of research saved me over $300.

Tennessee is cracking down on uninsured drivers — don’t be one of them. It doesn’t cost much to insure your vehicle. In fact, Tennessee drivers pay over 15 percent below the national average on their annual premiums. And according to my research, you could save even more simply by shopping around. How so? Insurance agencies develop unique formulas for calculating rates, considering things like your age, driving record, vehicle make and model, and zip code. The only way to find your lowest rate is to get at least five quotes and compare them.

I got quotes for the state’s minimum coverage from five top insurers and found out I could save $333 by choosing the right company. Progressive was my cheapest option at $300, but remember, that may not be the case for you. Auto insurance rates are highly personalized, so there’s no way I can recommend the best car insurance policy for everyone.

An online quote should only take five minutes or so. If you don’t know your annual mileage or your driver’s license number, look those up before getting started. You can also call for a quote, but that’ll take a little longer, probably about 10 minutes per call. And if you’re dealing with an independent agent, you may have to wait for them to give you a call back with the quote.

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Enter your zip code to compare rates from some of my top recommendations.

Our Top 5 Picks for the Best Car Insurance in Tennessee

I got quotes from the following five companies. I’d recommend you start here as well because each one has strong financial strength ratings and excellent customer service, per A.M. Best and J.D. Power, respectively. If you don’t know, A.M. Best measures a company’s long-term stability and a good score from them is a good sign the insurer will be able to pay out when necessary. J.D. Power is an internationally known organization that measures customer satisfaction across a variety of industries and they publish a yearly report on auto insurers. All of the companies listed here earned at least three stars in the most recent survey.

Insurer My quote
Progressive $300
Tennessee Farm Bureau $320
State Farm $363
Allstate $448
Auto-Owners Insurance $633

Progressive was the cheapest at $300 a year, but Tennessee Farm Bureau wasn’t far behind. Their policy was $20 extra, plus $25 in annual dues to be a member of the Bureau (not included in the price), but it also included extra coverage. In addition to the minimum liability, it came with $5,000 for medical payments as well as uninsured motorist coverage. Adding these coverages isn’t a bad idea, especially since uninsured drivers are such a problem in Tennessee.

Even If You’re Happy, It’s Best to Shop for a New Policy Every Couple of Years

Few people know it, but your shopping habits also impact your insurance rates. It’s a process called price optimization and it’s caused quite a controversy in the last few years. Essentially, the company looks at your online shopping habits and other factors and decides if you’re likely to leave them for a different insurer. If that risk is high, they’ll offer you a competitive price, but if it’s low, you may end up paying a higher rate because the company believes you’ll pay it without question.

Shopping around for new coverage every year or two helps you avoid being labeled as complacent by the insurer’s algorithms. This way, you’ll get quotes that accurately reflect your risk as a driver. That risk changes over time, so you may find in a year or two that your rates are much cheaper than they are today.

Fifteen states have banned insurers from using price optimization when calculating rates, but Tennessee is not one of them. So for the time being, it’s up to you to make sure you’re not paying a higher rate than necessary.

Tennessee’s Minimum Coverage

The Bare Minimum

Tennessee residents are required to carry $25,000 of bodily injury coverage per person and $50,000 per accident, plus $15,000 of property damage liability coverage. This is in line with what most states require, though the property damage requirement is a bit below average.

The Best Car Insurance is Not Just Cheap Car Insurance

Consider this:

  • The average driver has an accident every 17.9 years.
  • The average cost of a disabling, nonfatal injury is $80,700.

If I have utterly cheap car insurance and I T-bone someone, giving them an $80,000 injury, I’m in serious trouble. My insurance will only pay up to my policy limits and then I’m on my own. I’m likely to get dragged to court for the rest and just like that, my savings are gone.

Raising my policy limits to $50,000/$100,000/$25,000 would only cost me an extra $20 a year from Progressive. That still wouldn’t be enough to cover all the damages in the accident above, but it would mean less money I’d pay out of pocket. I’d barely even notice the extra $2 on my monthly premiums, so for me, the extra coverage is definitely worth it.

Uninsured drivers are rampant in Tennessee, so it’s wise to invest in optional uninsured motorist coverage as well. Without it, you risk paying to fix damages that weren’t your fault to begin with. Underinsured motorist coverage goes hand in hand with this. The minimum liability coverage isn’t enough in every accident, and in cases where the at-fault driver’s insurance won’t cover the full cost of the damages, underinsured motorist coverage will pick up the slack.

You may also want to think about vehicle protection, though it’s not required by law. If you have a lease or loan on your vehicle, your lender will likely require it. Collision coverage pays for damages to your vehicle following an accident with another driver, regardless of whether you were at fault. Comprehensive coverage pays for things like natural disasters, theft, vandalism, and wildlife collisions.

If You Skip Coverage, It’ll Cost You

Tennessee used to be one of the most lenient states about driving uninsured — and as a result, one in five drivers flouted the mandatory insurance laws. But as of July 2015, new laws were enacted to crack down on uninsured driving. You can now expect a minimum of a $300 fine and your vehicle may be towed at the discretion of the local police department. Repeat offenders will see even higher fines and suspension of their vehicle registration with a $300 reinstatement fee.

Get Quotes Now

Enter your zip code to compare rates from some of my top recommendations.

Beat the Average Premium: 9 Ways to Snag Cheap Car Insurance Rates

Because so many factors influence your rates, there’s a lot you can do to lower them. One option is to move to a cheaper area, but there are other far less dramatic changes you can make too. For example, I earn some nice discounts by limiting how often I drive and always paying my auto insurance premium in full. Check out the list below for more ways you can knock a chunk of change off your monthly auto insurance premium.

Nine ways to lower your car insurance

FAQs

Why are Tennessee’s rates the way they are?

What to Expect
Average Monthly Premiums
Memphis $138
Jackson $116
Knoxville $113
Nashville $111
Murfreesboro $109
Clarksville $109
Chattanooga $104
Johnson City $96
Source: Quadrant

Tennessee is a largely rural state and this works in its favor when it comes to auto insurance. With people more spread out, the chances of accidents, vandalism and auto thefts go down as do auto repair and medical costs — all good things to insurance providers. City residents can expect higher premiums due to their increased likelihood of filing a claim.

Tennessee residents statewide may even see a decrease in their average premiums, if the new uninsured driving penalties do their job. Fewer uninsured motorist claims will lessen the risk of insuring Tennessee drivers and that could result in big savings for those with good driving records.

What if I’m not a full-time resident?

If Tennessee is your primary state of residence, you must comply with state auto insurance laws, regardless of whether you live there year round. If you’re not a resident, you may operate your vehicle for a period of 30 consecutive days without registering it. If you’re staying longer than that, you must register your car and purchase auto insurance that meets the state’s minimums. The exception is military personnel, who may maintain their home-state registration while on active duty.

The Bottom Line

The only way to find the best car insurance policy for you is to do a little research: Decide how much coverage you need, get quotes, and compare them. Pretty simple, right? It’s also best to go with more than the minimum coverage if you can. It might seem like just an extra expense now, but it’ll take a lot of stress off you if you get into a costly accident.

Get Quotes Now

Enter your zip code to compare rates from some of my top recommendations.

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