The best affordable auto insurance companies offer drivers rates that are below average for the local area. Policy costs are lower without compromising coverage or quality. While premiums for required and optional coverage are less expensive than competitors, the best cheap auto insurance companies still provide top-notch claims handling, an easy quote process, and multiple discount opportunities.
To find the best auto insurance for customers who are looking for a bargain, The Ascent reviewed average premiums, policy availability, and insurer reputation. The goal was to find insurance policies offering low prices for drivers in all different situations and to see which insurance companies provided the top-notch service that all customers deserve.
Don't focus on premiums alone when looking for cheap insurance
Drivers looking for cheap insurance must not compromise protection for price. While it's a good idea to shop around to find an affordable auto insurance carrier, drivers should be wary of dropping optional coverage or maintaining only minimum coverage in order to save on premiums.
While most states only require certain types of insurance, such as liability coverage, individual drivers often need more protection than the minimum coverage would provide. For example, motorists may wish to consider purchasing:
- Collision insurance to pay for damages to their own vehicle if they cause a crash.
- Uninsured/underinsured motorist coverage, which is required in some states and which pays for the policyholder's damages caused by a driver who doesn't have any or enough insurance coverage.
- Comprehensive insurance, which pays for theft or damage to the policyholder's vehicle resulting from non-collisions (such as if a tree falls on the car).
Buying minimum required coverage is undoubtedly less expensive. The national average premiums for liability-only coverage come in at just $764. However, without optional protection, drivers could be forced to pay to repair or replace their vehicle out of pocket if something goes wrong. Their insurance would only cover losses they cause to others.
Best cheap car insurance for poor credit
Drivers with low credit undoubtedly face more expensive insurance costs. Insurers take credit scores into account when setting premiums. That's why motorists will need to shop around more carefully to find the most affordable carriers when their credit score isn't as high as they'd prefer.
Based on a review of insurance data from multiple states, the most affordable insurers for poor credit include:
- Geico: Geico offers affordable options for drivers with low credit. Average premiums for a 35-year-old male driver in Florida with poor credit who uses the car for commuting would be $2,321. By comparison, the overall average premium for the same driver would be $4,144.
- State Farm: State Farm also consistently provides more affordable premiums for low-credit drivers than competitors do. For example, a 35-year-old male driver in Florida with low credit would face an average insurance premium of $2,484 from State Farm -- well below the overall average.
Best cheap car insurance for drivers with accidents
Insurers price policies based on risk. After an accident, a driver will be more expensive to insure because insurance companies fear another collision is likely in the future, meaning the insurer may have to pay out another claim.
Some insurers do not penalize drivers as much as others do, so motorists with an accident on their record should shop around carefully for coverage. The Ascent researched the best car insurance options for high-risk drivers, including motorists with an accident history, and found the most affordable options include:
- State Farm: Average premiums for a driver in Florida with one accident on their record and excellent credit came in at $1,171, compared with an overall average premium of $4,531 for drivers with an accident history.
Geico: Average premiums for a driver with excellent credit and an accident history who commutes in their vehicle are just $1,467 from Geico -- also well below the overall average.
Best cheap car insurance by state
Car insurance prices can vary by state. In Ohio, for example, average insurance premiums are just $1,657, while premiums in more expensive states such as Michigan average $4,894.
Here are some of The Ascent's picks for the best cheap car insurance by state:
The Ascent's best cheap car insurance of 2022
- Geico: Best for rock bottom premiums
- The Hartford: Best for seasoned drivers
- USAA: Best for military members and their families
- Nationwide: Best for bundling home and auto insurance
- State Farm: Best for bundling coverage
- Erie: Best for predictable pricing year-over-year
Geico
Best for rock bottom premiumsGeico
Rating image, 4.50 out of 5 stars.
Bottom Line
Geico is one of the most affordable insurers available, with the national average rate for all drivers coming in at $1,758 with Geico compared with $2,646 for all insurers.
Geico not only offers comprehensive auto insurance coverage options at premiums that beat out most competitors, but it also promises to save customers 15% or more on car insurance. Insurance is available in all 50 states, and there are additional discounts for military members, good students, federal employees, seniors, and others who belong to certain groups or organizations.
Pros
- Nationwide coverage
- Affordable premiums
- High customer satisfaction
- Efficient claims handling process
- Great online application and account management experience
Cons
- Limited insurance coverage beyond auto insurance
- Fewer local agents than competitors
Stand-Out Coverage Options
- Mechanical Breakdown Insurance, which provides coverage for repairs and is available for new or leased vehicles that are less than 15 months old and have less than 15,000 miles
- Auto Repair Xpress® program can get motorists back on the road faster after an accident as they'll get priority repairs and streamlined claims processing
- Rideshare insurance is available
The Hartford
Best for seasoned driversThe Hartford
Rating image, 4.00 out of 5 stars.
Bottom Line
Hartford's affiliation with the AARP allows drivers 50-and-up to score the best discounts on premiums if they are members. Drivers 55-and-over could qualify for premiums as low as $63 per month, which is well below the national average for the age group.
Seniors also benefit from the Hartford's unique disappearing deductible, which rewards drivers who don't have accidents with a reduction in their deductible -- potentially down to $0.
Pros
- AARP members can save substantially on premiums
- Disappearing deductible means drivers won't have to worry as much about large out-of-pocket costs if something goes wrong after several years of safe driving
- Top-notch customer service, recognized by J.D. Power & Associates as number one in shopper satisfaction
Cons
- AARP membership is required to get the best price
- Limited ability to save by bundling policies since it offers few other types of insurance besides business, home, and auto insurance
- No insurance options are available for ridesharers
USAA
Best for military members and their familiesUSAA
Rating image, 4.00 out of 5 stars.
Bottom Line
USAA offers military members and their families some of the best auto insurance coverage available. Premiums are lower than most competitors, with average premiums of $1,871 for all drivers compared with a $2,646 national average for all insurers.
USAA also offers plentiful coverage options and many opportunities to save further with premium discounts. Free accident forgiveness coverage after five years also means premiums won't go up if a crash happens. USAA is open only to military members, veterans, and their families. For those who qualify, it's likely their best bet for car insurance.
Pros
- Premiums are cheaper than with most competitors
- High customer satisfaction ratings
- Policy discounts (for good students, for housing a car on a military base, and more)
Cons
- No coverage available outside of current and former military members, and their families
Stand-Out Coverage Options
- Free accident forgiveness after five years
- Rideshare insurance is available
Nationwide
Best for bundling home and auto insuranceNationwide
Rating image, 3.50 out of 5 stars.
Bottom Line
Nationwide's average annual premiums for all drivers are just $2,214 -- well below the national average.
The insurer also offers some of the best savings when buying bundled coverage, with those who purchase both home and auto saving an average of around $700 annually on their coverage.
Pros
- Many different types of insurance policies are available so there are ample options to bundle coverage and earn discounts
- SmartMiles option bases premiums on how much someone drives, so those who don't use their vehicles often can get more affordable coverage
- Nationwide earned top marks on J.D. Powers shopper satisfaction survey
Cons
- Some reviewers indicated Nationwide was more expensive than competitor policies
- No rideshare insurance available
State Farm
Best for bundling coverageState Farm
Rating image, 5.00 out of 5 stars.
Bottom Line
State Farm offers national average premiums of $2,147 for all drivers -- more than $719 below the national average for all insurers.
The insurer also offers multiple opportunities for discounts, including for bundling coverage. But the best savings comes from the different programs it offers for young drivers, including Steer Clear and a good student discount. With comprehensive coverage options and low premiums, parents and teens can rest assured they're protected in case of an accident.
Pros
- Young adult drivers can save up to 15% on coverage
- Discounts for good grades can provide another 25% savings for young drivers
- High customer satisfaction rankings
- Nationwide agent network
- Access to array of insurances under one roof
Cons
- A low credit score can increase premiums
- Agent quality within its network can be inconsistent
Stand-Out Coverage Options
- Steer Clear program offers discounts for policyholders under the age of 25
- Optional car rental and travel expense coverage pays not just for a rental vehicle but also travel expenses to the driver's home or destination if an accident happens 50 or more miles home
- Rideshare insurance is available
Erie
Best for predictable pricing year-over-yearErie
Rating image, 4.00 out of 5 stars.
Bottom Line
Erie's national average premiums come in at just $2,051, making it one of the most affordable auto insurers.
For those concerned about rising premium prices, Erie's Rate Lock can alleviate those worries. Premiums change only if the policyholder makes changes, such as adding or removing a driver or moving where the vehicle is stored.
Pros
- Earned top marks on J.D. Powers Insurance Satisfaction survey
- Pet injury coverage pays for up to $500 per covered accident in veterinary care per pet or $1,000 total in vet care for multiple pets
- Diminishing deductible option if the driver opts for the Auto Plus package
Cons
- Available only in a limited number of states
- Smaller than some other insurers, so fewer local agents available
How to get cheap car insurance
Price is one of the key factors that drive customers' satisfaction with their car insurer, according to J.D. Power & Associates. So if you're wondering, "Where can I get cheap car insurance?" you aren't alone.
To help find cheap car insurance, here are nine steps a motorist can take:
- Get quotes from several auto insurers: Prices can vary a lot from one insurer to the next. When looking for the best company for auto insurance, aim to get at least three auto insurance quotes. This will let you compare prices. Someone who has their VIN handy will have an easier time receiving more accurate quotes.
- Choose the right vehicle: Some cars are cheaper to insure than others. Drivers who want cheap auto insurance can opt for a mid-priced vehicle to keep costs down. Ideally, they should choose one with an alarm and lots of safety features.
- Pay premiums annually: Most insurers offer a discount if a driver pays their insurance premiums annually. If they choose not to pay monthly, they can get the best cheap car insurance without compromising coverage.
- Make sure your credit history is error-free: Many car insurance companies use a driver's credit history to help set premiums. When shopping for cheap car insurance, motorists should make sure the information on their credit report is accurate. Mistakes could make a driver seem like a riskier borrower. You can contact the major credit bureaus to correct errors.
- Limit who drives the vehicle: Insurers may charge more if the policyholder has a teen driver on their policy. A driver with a history of accidents or moving violations is also more costly. People who want the best cheap car insurance shouldn't let other people use their vehicles. Insurers could raise rates as a result.
- Take a defensive driving course: Many auto insurance companies offer discounts for customers who take courses to improve their driving skills. This can be most valuable for teens, but adults can benefit, too.
- Buy only the necessary coverage: People definitely need liability coverage to protect against losses they cause. But they may not need roadside assistance if they already have AAA. If a driver has an older vehicle, they may also decide to drop collision coverage. This pays for repairs or replacement of the vehicle. Drivers with hefty emergency savings may also opt for higher deductibles. High deductibles lead to lower premiums. But drivers will have to foot more of the bill if they need to use their insurance coverage.
- Bundle coverage: Drivers can look for a cheap insurance company that sells several types of insurance. People can get significant discounts if they combine auto insurance with other policies, such as homeowners insurance. These can help get the best cheap car insurance.
- Ask about other discounts: Those looking for the best cheap car insurance will find many insurers offer other savings. For example, young drivers could get good grade discounts. Many companies also offer discounts for having an advanced degree, being married, working for certain employers, or owning a home. Check out The Ascent's guide to discounts on car insurance for some examples of how you can save.
Learn more: How to get very cheap car insurance
Are older cars cheaper to insure?
Motorists looking for the best cheap car insurance may want to drive an older vehicle. These drivers often pay a lower insurance premium for several reasons:
- Their value is lower. The insurance company wouldn't have to pay out as much to replace the vehicle if it's stolen or totaled.
- They may be able to drop some types of coverage. It may not be worth paying insurance premiums for collision coverage on an old vehicle with little market value.
- Older cars may be less likely to get stolen. There's less risk the insurance provider may have to pay out after a theft.
Unfortunately, older vehicles may lack the safety features of new cars. These can include passive restraints or frontal airbags. An insurer may charge more for medical coverage if a driver doesn't have these features, as they'll be at greater risk of serious injury.
Shop around for the best cheap car insurance. Drivers can often find an insurer to cover their older vehicles at an affordable price.
FAQs
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For national insurers, USAA has the cheapest car insurance at $31 per month. Geico is next at $34 per month. For local insurers, Integrity Indemnity has the cheapest car insurance at $16 per month, followed by Farmers Mutual of Nebraska at $19 per month.
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Drivers under the age of 25 have less experience behind the wheel and are more likely to be involved in a car accident. Drivers aged 16 to 20 and 21 to 24 are the two age groups that are most likely to be in a fatal vehicle crash. Insurance companies mitigate their risk by charging those under 25 a higher car insurance premium.
Outside Experts Weigh In
Craig Seidelson, Ph.D.
Assistant Professor of Operations and Supply Chain Management at The University of Indianapolis
How can shoppers know they're getting the cheapest car insurance?
All things equal, the best car insurance rates typically go to those with the highest credit scores. The logic being higher scores correlate with lower chances of filing claims. Less claims result in cheaper rates. There are, of course, some caveats. Insurance scores are not exactly the same things as credit scores. Unlike credit scores, insurance scores also consider: age, gender, address, marital status, and occupation. Auto insurers in California, Hawaii, and Massachusetts cannot use credit scoring for auto insurance. In Washington state, insurers are forbidden from denying coverage solely on the basis of credit score.
What are some areas of coverage where shoppers can specifically save on car insurance?
As your vehicle gets older and miles start to build up, at some point it won't make sense to carry comprehensive coverage. Comprehensive gives you money to pay for theft and/or damage to your vehicle caused by weather, fire, vandalism, etc. What many people fail to realize is the maximum comprehensive payout cannot be greater than the value of the vehicle.
Are there any drawbacks associated with selecting the cheapest car insurance option?
With car insurance you get what you pay for. The cheapest premiums offer the lowest coverage. A liability-only policy with limits of 10/20/5 ($10,000 per person and $20,000 per accident for bodily injury, and $5,000 for property damage) could cost hundreds of dollars less per month than a policy with higher limits which also includes collision and comprehensive coverage.
Derek Stimel, Ph.D.
Associate Professor of Teaching Economics at The University of California, Davis
How can shoppers know they're getting the cheapest car insurance?
Realistically a shopper won't ever know for sure that they have the cheapest car insurance. In general the more time and effort a shopper puts into researching and getting insurance quotes, the better the deal they will likely receive. A reasonable strategy is to get a few quotes from one company for different policies and then use those to shop around to different insurance companies to see if they can offer similar policies at lower prices. That makes it more likely the shopper is at least getting a good deal where the expected value of the policy exceeds the expected cost.
What are some areas of coverage where shoppers can specifically save on car insurance?
The easiest savings come from some automatic discounts an insurance company may offer. This can be for things like a clean driving record, membership in a particular professional organization, or if the shopper is willing to bundle auto insurance with other types of insurance. For example, having home insurance or multiple policies for family members with the same company and insurance agent can result in a better deal.
Are there any drawbacks associated with selecting the cheapest car insurance option?
There are drawbacks. A lower premium will typically mean reduced benefits or value of the insurance policy. This can include the driver paying more out of pocket with a higher deductible and/or a lower cap on coverage amounts. There can be gaps in coverage where the policy covers fewer bad situations or circumstances. It can also mean that the insurance company will try to save on costs for themselves in other ways. This might mean reduced or slower customer service due to fewer employees such as insurance agents and claims adjusters.
About the Author
Christy Bieber is a full-time personal finance and legal writer with more than a decade of experience. She has a JD from UCLA as well as a degree in English, Media and Communications with a Certificate in Business Management from the University of Rochester. In addition to writing for The Ascent and The Motley Fool, her work has also been featured regularly on MSN Money, CNBC, and USA Today. She also ghost writes textbooks, serves as a subject matter expert for online course design, and is a former college instructor.
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