Lincolnshire County Council paid out more than £119,000 on over 600 claims for damage to vehicles due to potholes over the last 24 months.
The figures come from a Britannia Rescue research survey based on Freedom of Information requests sent to councils across the country.
A combination of a wet summer and a cold winter has particularly harmed road surfaces, with drivers claiming damages caused by potholes.
Lincolnshire was number five in the rankings for pothole compensation claims paid out with £119,706 from 620 claims.
The car rescue firm said the problem facing councils is that road maintenance in the UK is severely under-funded, with just £17 spent per driver on maintaining road surfaces and fixing potholes, some 11% of the annual road tax bill.
Assistant Director for Highways and Transportation, Paul Coathup, said: “Most of the places on this list are large rural areas with an extensive road network and the number of potholes will naturally be higher.
“With one of the largest rural networks in the country, perhaps it’s not surprising if we are near the top.
“We’ve seen the number of claims submitted drop by around 60% for 2011/12, owing to the milder winter weather we experienced last year. T
“Typically, claims are for minor damage to car tyres. We do repair the more serious defects within 24 hours.
“If you do spot any potholes while you’re out and about however, as we do rely on your eyes and ears too, please let us know and we’ll check they are planned in for repair.”
The top 10 councils for pothole compensation claims paid out are:
- Surrey – £632,239 (3,650 claims)
- Barnsley – £241,202 (296 claims)
- Nottingham – £158,578 (777 claims)
- Kent – £133,593 (4,904 claims)
- Lincolnshire – £119,706 (620 claims)
- Worcestershire – £110,560 (668 claims)
- Essex – £103,507 (2,696 claims)
- Hertfordshire – £101,630 (1,739 claims)
- Lancashire – £97,160 (626 claims)
- East Sussex – £86,591 (1,388 claims)