ASK Mike Duggan, the mayor of Detroit, what keeps him up at night and he replies, without a second’s hesitation, “car insurance”. For those familiar with the city’s precarious finances, bad schools and blighted neighbourhoods, this might seem a strange answer. But even among this throng of flashy ailments, Detroit’s car-insurance problem looks egregious. The average cost of insurance premiums in the city is $5,414 per year, more than twice the state average and nearly four times the national average. For the typical Detroit household, making $26,300 a year, this would represent 21% of pre-tax income. Cars are an inescapable necessity in Motor City, a 140-square-mile expanse lacking robust public transportation. Residents therefore flout the law by registering their policies at addresses outside the city, where insurance costs less than half what it does inside, or by driving without any insurance at all. Good numbers are understandably difficult to come by, but it is now estimated that up to 60% of Detroiters drive without insurance.

The problem is not just limited to Detroit. Costs are also spiralling out of control in Flint, another Michigan city down on its luck. Car-insurance premiums there have spiked 30% since the city’s water crisis in 2014, and now stand at $3,507 per year. In fact, car-insurance premiums in the state are so hugely regressive that those living in the poorest zip codes, where the typical family lives below the federal poverty line, can expect to pay twice as much to insure their cars.

Adding to the cost of driving, Michigan introduced a “Driver Responsibility Fee” in 2003 to shore up state finances. This added extra fees for things like speeding or making improper turns, on top of the existing fines. These responsibility fees could amount to $1,000 a year. Those who failed to pay had their drivers’ licenses suspended. “It was essentially a sin fee,” says Joshua Rivera of the University of Michigan. (After several years of legislative haggling, the fees will be scrapped in October.)

Insurers in the state base their quotes on a driver’s zip code, credit score and educational qualifications. Scoring poorly on any of these results in a higher rate. Loretta, an Uber driver, says her insurance bills exceeded her car payments when she lived in Detroit. When she moved 30 miles away, her premiums halved. Insurance companies may make for easy targets, but blame really lies with the state of Michigan, which has put bad policy in place and failed to fix it. The state mandates that all drivers buy no-fault insurance with unlimited medical insurance—meaning that the insurer will pay for unlimited lifetime medical expenses, rehabilitation services and lost wages after a car accident, no matter who is at fault. It is the only American state that mandates such generosity.