Reasons Why Where You Park Your Car at Night Affects Your Insurance Rate

When it comes to auto insurance, many people assume their driving record is the biggest factor in determining their premium. While that’s certainly true, another lesser-known but equally important factor is where your vehicle is parked, or "garaged," overnight.

Whether you live in a bustling urban area or a quiet rural town, your ZIP code plays a big role in how much you pay. But why does this matter? And what happens if the garaging address on your policy doesn’t match reality?

Garaging Location = Risk Profile

Insurance companies calculate rates based on risk exposure, and your vehicle’s garaging address is a key risk indicator. If you park your car on a quiet residential street in a low-crime area, your risk for theft, vandalism, and accidents is lower than if you park in a densely populated city with higher crime or traffic congestion.

For example, drivers in Detroit, Michigan, pay some of the highest auto insurance premiums in the country, with an average of $4,726 per year, while those in less populated areas like Maine pay just over $1,100 annually, on average.

Garaging data is also used to predict weather-related risks. Areas prone to hail, flooding, or wildfires may have higher comprehensive rates due to increased claim frequency.

Can You List a Different Garaging Address?

This is a common but risky mistake. Some drivers, especially college students or city commuters, are tempted to list a parent or second home address with a lower rate. However, this can be considered misrepresentation, and if a claim arises, especially a comprehensive claim like theft, vandalism, or fire, your insurer could deny the claim or cancel your policy.

According to the Insurance Information Institute, auto insurance fraud, including false address reporting, adds nearly $29 billion to U.S. insurance costs annually.

To stay on the right side with your insurance company, it’s best (and the law in most states) to:

• Always list the actual garaging location, even if it’s not your primary residence.
• Notify your agent immediately if your garaging situation changes, such as due to a temporary move or going to college.
• Understand that “garage-kept” doesn’t mean parked inside a garage; it refers to the address where the vehicle spends most nights.

Garaging Done Right

Garaging location isn’t just a technicality; it’s a core component of your auto insurance rate. Being honest about where your vehicle sleeps at night not only ensures accurate pricing but also protects you in the event of a claim. If you’re unsure whether your current policy reflects your true situation, reach out to our office for a quick review. It could save you more than just money.