The study, conducted by the department's Federal Insurance Office (FIO), found that car insurance is generally unaffordable in 845 US areas, as defined by postal codes, that are typically home to minorities and people with low-to-moderate incomes.
More than 40 percent of Americans living in areas with unaffordable insurance reside in New York, New Jersey and Connecticut.
States with the greatest number of residents facing unaffordable insurance include New York (5.2 million), Florida (2.8 million), New Jersey (2.3 million), Michigan (1.7 million), Pennsylvania (1.1 million) and Texas (873,000).
Congress established the FIO in 2010 as part of the Dodd-Frank financial reform law, tasking the office with monitoring whether underserved communities have access to affordable non-health insurance products such as life and property insurance.
The study, published on Friday, was the FIO's first to target auto insurance affordability. It noted that Americans who cannot afford coverage are at a disadvantage, because drivers tend to have more economic opportunities including employment. Nearly all states require drivers to buy some type of auto insurance.
"The government can't force people to buy products in the private marketplace but pay no attention to whether the prices are sufficiently affordable that people can comply with these laws," said J. Robert Hunter, director of insurance for the Consumer Federation of America, in a statement.
"Unaffordable" insurance, as defined by FIO, costs more than 2 percent of the median household income within a zip code.
The study analysed population and insurance premium data to create an index that consumers and policymakers can use to examine affordability over time. The FIO plans to collect more data and refine its results in future studies, it said.
