INSURANCE - CAR INSURANCE

Average Cost of Car Insurance in Alaska for 2024

Updated Feb. 14, 2024
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USAA is generally the cheapest car insurance in Alaska for both full coverage and minimum liability policies.

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Alaska is known for its incredible wildlife and stunning views. But with its intense weather and disconnect from other states, the Last Frontier has one of the highest costs of living in the country.

Luckily, the higher living cost doesn't affect car insurance rates in Alaska; auto coverage tends to be relatively inexpensive in the state. The average cost of car insurance in Alaska is $1,167 per year for full coverage policies, compared to the national average of $1,582.

Depending on your driving habits, vehicle, age, and credit, you may be able to save even more money on your insurance policy.

In this article

Key takeaways

  • The average cost of car insurance in Alaska is $1,167 per year for full coverage.
  • State-minimum liability insurance costs an average of $500 per year.
  • Teen drivers pay an average of $3,778 per year.

How much does car insurance cost in Alaska?

Alaska is the largest state in the country, but it also has the lowest population density. Fewer vehicles are on the road because so few people live in the state. In fact, the U.S. Department of Transportation reported that there are fewer than 800,000 registered vehicles in Alaska. To put that number in perspective, consider that Texas — the second-largest state — has over 22 million registered vehicles.

With fewer cars on the road, there's less chance of getting into an accident, so car insurance in Alaska is less costly. The average cost of full coverage policies, which include liability, collision, and comprehensive insurance, is $1,167 per year, compared to a national average of $1,582.

Avg. cost for full coverage Avg. cost for minimum coverage Cheapest insurance provider
$1,167/year $500/year USAA
Avg. for young drivers Avg. cost for seniors Avg. for high-risk drivers
$3,778/year $1,484/year $1,904/year

Average cost of car insurance in Alaska by provider

Car insurance is available from multiple companies in Alaska, including major insurers like State Farm and Progressive. But drivers in the state can also get coverage from smaller, regional insurers like Umialik.

We found that USAA and State Farm offer the lowest average premiums in Alaska for full coverage policies. For state-minimum liability coverage, USAA and GEICO are the cheapest.

Provider Full coverage Minimum liability coverage
Umialik $1,380/year $468/year
Allstate $1,395/year $479/year
GEICO $1,014/year $388/year
State Farm $904/year $453/year
Progressive $1,423/year $903/year
USAA $864/year $296/year

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How does credit score affect car insurance rates in Alaska?

Insurers can use driver credit scores to determine how much you'll pay for car insurance. If you have good credit, you'll typically pay less for car insurance than someone with poor credit.

In Alaska, we found that the average premium for drivers with credit scores between 550 and 649 is $2,001 — significantly higher than the state average.

Credit health Avg. annual premium
Poor (550-649) $2,001/year
Average (650-699) $1,743/year
Good (700-749) $1,534/year
Excellent (750+) $1,348/year

Average car insurance rates for high-risk drivers in Alaska

As is common in other states, car insurance premiums in Alaska will significantly increase if a driving violation is on record. A driving under the influence (DUI) conviction will have the largest impact, causing premiums to increase by an average of $1,160 per year.

Violation Avg. annual premium before violation* Avg. annual premium after violation Avg. cost increase
At-fault accident $1,167/year $1,998/year $831
DUI $1,167/year $2,327/year $1,160
Speeding ticket $1,167/year $1,673/year $506

*Assumes clean driving record with good credit

How does age affect car insurance rates in Alaska?

Teens are the most likely to be involved in serious accidents out of all age groups. Consequently, insurance companies charge much higher premiums for teens than older adults.

In Alaska, the average premium for drivers 18 years of age is $4,047 per year — thousands more than the state average.

Age Avg. annual premium
18 $4,047/year
25 $1,385/year
30 $1,247/year
40 $1,213/year
60 $1,301/year

Alaska car insurance rates by city

Although Alaska has a relatively low population, it does have several cities, and your premiums can vary based on where you live. If you live in a more densely populated area, you'll pay more for coverage since you're more likely to be in an accident.

In Alaska, drivers in Wasilla have the highest premiums with an average of $1,689 per year. The increased expense is because of Wasilla's population density and crime rate. 

According to NeighborhoodScout, Wasilla has a crime rating index of seven, meaning that 93% of cities in the U.S. are safer, and residents of the city have a one in 35 chance of being a victim of property crime.

City Avg. annual full-coverage premium
Wasilla $1,689/year
Anchorage $1,678/year
Fairbanks$1,658/year
Bethel $1,579/year
Kenai $1,491/year
Juneau $1,272/year

AK's minimum car insurance requirements

Alaska's state laws do require drivers to have car insurance. However, some areas, such as Annette Island, Cape Pole, Hinchinbrook Island, and Taku Harbor, are exempt from state vehicle registration and insurance laws.

For those that must have insurance, your policy must meet state minimums. Alaska has higher requirements than many other states, so make sure your policy meets the following coverage minimums:

  • $50,000 in bodily injury protection for one person
  • $100,000 in bodily injury protection for two or more people
  • $25,000 in property damage insurance

Even though those coverage limits are higher than you'll see in other states, it may not be enough coverage to protect you and your property adequately. According to the Insurance Research Council, 16.1% of drivers in Alaska are uninsured, so you may want to consider purchasing additional coverage with uninsured/underinsured motorist protection.

How to save money on car insurance in Alaska

To save money on your car insurance premiums, follow these tips:

  • Complete a safe driving course: According to Alaskan law, insurers must provide a discount to drivers 55 or older who complete an approved safe driving course.
  • Ask about other discounts: If you aren't eligible for the safe driving discount or want to find out if other discount programs are available, contact your agent. Insurance companies usually offer multiple discounts, including multi-vehicle, multi-policy, good student, and paperless billing discounts.
  • Shop around: As discussed above, insurance rates can vary greatly between companies. To find the best car insurance rates possible, request quotes from several insurers that issue policies in Alaska.

Methodology

Our analysis was conducted using six different auto insurance marketplaces to determine the average cost of auto insurance in each state. The data we analyzed included coverage premiums from up to 10 different insurance providers. We looked at rates by city, driver profile, and credit score, as well as factored in the impact of driving violations. This data is for comparative purposes only. Your actual quote may be different.

FAQs about car insurance costs in AK

Is car insurance expensive in AK?

Car insurance in Alaska is relatively inexpensive. Full coverage policies average $1,167 per year, while the national average is $1,582.

How much is car insurance per year in AK?

The average cost of car insurance in Alaska is $1,167 per year for full coverage policies and $500 for state-minimum liability coverage. 

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Author Details

Kat Tretina Kat Tretina is a personal finance expert focusing on practical financial matters, including student loans, debt repayment, side hustles, insurance, and healthcare. Drawing from her personal experience, she aims to simplify complex financial topics and provide individuals with the information they need to make informed decisions.