48211: A look at the ZIP code with the highest insurance premiums in the country

History of Detroit

Before diving in 48211, we have to consider the history of the city of which it is a part. Detroit's rise and fall — and rebirth — is key to its identity. Settled by the French in 1701, various indigienous tribes (the Huron, Odawa, Potawatomi and Iroquois peoples) inhabited the area before European settlement. The Anishinaabe called the area Waawiiyaataanong, translating to 'where the water curves around.’ 

That water, the Detroit River, afforded the city crucial access to the Great Lakes, the Saint Lawrence Seaway, the Atlantic Ocean and — by extension — the world. As a major port, a border crossing with Canada and then home to the “Big Three” car manufacturers (GM, Ford and Chrysler), Detroit at the turn of the 20th and through the mid-century, was called the “Paris of the West.” Its wide boulevards lined with the mansions of captains of industry. Meanwhile, beginning in 1916, the Great Migration brought a population surge of black residents to the city and eventually the rise of Motown. 

As industry crumbled in the 60s and 70s and racial tensions rose during the Civil Rights Movement, Detroit experienced turbulent times, eventually becoming the largest city to ever file for bankruptcy in 2013. With its debt forgiven, the city made headway in revitalizing its downtown core. One big step was replacing its notorious broken street light system (at one point, 40% of all street lights were burnt out) and becoming the largest city with all LED street lights. Government efforts have also put great effort into revitalizing previously struggling neighborhoods. But the rebirth is not spread evenly throughout Motor City — and it shows.

What's happening in 48211

One place that is still a work in progress is 48211. Here vacancies are still high, and the population continues to shrink. 

48211, also referred to as “Poletown” for its previous Polish immigration wave, is not unlike other parts of the sprawling city. A mixture of tightly held onto family homes, abandoned structures, the remains of commercial collapse and empty lots giving way to community gardens.

While Detroit has the highest average insurance of any city in America (at $5,102), and Michigan was long the nationwide leader in astronomical rates (since conceding the title to Louisiana in 2022), the Hamtramck neighborhood is home to the nation's highest rate, a staggering yearly cost of $6,360. This is nearly four times the national average. 

How does 48211 arrive at such an infamous distinction? You've heard the expression "location, location, location," and it's crucial for insurance costs. However, there are many additional layers within the ZIP code of where one's car is parked.

Why location affects auto insurance premiums

There are a number of reasons insurers consider location, down to the ZIP code and neighborhood level when determining how much you pay. 

Insurance companies look at a ZIP code's:

• crime rates
• traffic
• accident rates
• the number of uninsured motorists
• claims history
• weather and environmental factors like natural disasters
• state and local government regulations

And this is all before an individual's driving history, personal factors (such as age, gender, education or credit score) and the vehicle are included in the insurance equation.

You'll note many of the things on this list will directly impact how likely a driver is to file a claim. After all, the more accidents in your area, the more likely you are to be involved in an accident, even if you yourself are a careful driver. You can learn more about how the activities of those around you affect your premiums in our recent "Risk Assessment Pool Party."

Why 48211 is so expensive

But back to our ZIPs. Let's dig into some location data about 48211, which helps explain the area's rates. 

Crime: 48211 is in the 4th percentile for safety, meaning 96% of ZIP codes are safer, and 4% of ZIP codes are more dangerous, increasing the likelihood of car and home thefts and, of course, claims. 

Accident rates: Michigan ranks 30th in the U.S. in accidents per 100,000 people.

Uninsured motorists: About 25% of Michigan residents do not have insurance; second in the nation. But in Detroit proper, that percentage is closer to 60 — nearly four times the national average. 

Weather: Detroit experiences above-average hail storms, meaning more claims.

Regulations: Michigan passed historic insurance reform in 2019 in 2020, most notably eliminating the state's requirement that all drivers buy unlimited, lifetime medical coverage for car accident injuries. The effects on cost are mixed, as research shows Detroit's residents continue to experience disproportionately high rates compared to the rest of the state. 

So when this is all factored in 48211, you've got sky-high costs for consumers. 

Data Sources: The Zebra State of Auto Insurance 2022, TheZebra.com, Center for Disease Control, Insurance Research Council, MLive.com, State of Michigan, University of Michigan, Insurance Information Institute, CrimeGrade.org

If you live in 48211 or a similarly high-insurance-rate ZIP, all is not lost. By being a good driver yourself, you can help mitigate some of the affects of your location. You should also compare insurance rates regularly to see if you are being offered the most competitive one. The Zebra makes it easy to do all your insurance comparison research in one place.