We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare information for free - so that you can make financial decisions with confidence.
Bankrate has partnerships with issuers including, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover.
How We Make Money.
The offers that appear on this site are from companies that compensate us. This compensation may impact how and where products appear on this site, including, for example, the order in which they may appear within the listing categories. But this compensation does not influence the information we publish, or the reviews that you see on this site. We do not include the universe of companies or financial offers that may be available to you.
This advertising widget is powered by HomeInsurance.com, a licensed insurance producer (NPN: 8781838) and a corporate affiliate of Bankrate. HomeInsurance.com LLC services are only available in states where it is licensed and insurance coverage through HomeInsurance.com may not be available in all states. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.
Best car insurance companies for May 2022
To find the best of the best, Bankrate researched average prices, coverage offerings, discounts and third-party scores for hundreds of companies.
Angelica Leicht is an insurance editor on the Bankrate team. She is truly passionate about helping readers make well-informed decisions for their wallets, whether the goal is to find the right comprehensive auto policy or the best life insurance policy for their needs.
Reviewed By
Mark FriedlanderDirector of corporate communications, Insurance Information Institute
Mark Friedlander is director of corporate communications at III, a nonprofit organization focused on providing consumers with a better understanding of insurance.
At Bankrate we strive to help you make smarter financial decisions. While we adhere to strict
, this post may contain references to products from our partners. Here's an explanation for
.
This content is powered by
HomeInsurance.com
(NPN: 8781838). For more information, please see our
.
Why you can trust Bankrate
Founded in 1976, Bankrate has a long track record of helping people make smart financial choices.
We’ve maintained this reputation for over four decades by demystifying the financial decision-making
process and giving people confidence in which actions to take next.
Bankrate follows a strict editorial policy,
so you can trust that we’re putting your interests first. All of our content is authored by
highly qualified professionals and edited by
subject matter experts,
who ensure everything we publish is objective, accurate and trustworthy.
Our insurance team is composed of agents, data analysts, and customers like you. They focus on the points consumers care about most — price, customer service, policy features and savings opportunities — so you can feel confident about which provider is right for you.
We guide you throughout your search and help you understand your coverage options.
We provide up-to-date, reliable market information to help you make confident decisions.
We reduce industry jargon so you get the clearest form of information possible.
All providers discussed on our site are vetted based on the value they provide. And we constantly review our criteria to ensure we’re putting accuracy first.
Editorial integrity
Bankrate follows a strict editorial policy, so you can trust that we’re putting your interests first. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions.
Key Priniciples
We value your trust. Our mission is to provide readers with accurate and unbiased information, and we have editorial standards in place to ensure that happens. Our editors and reporters thoroughly fact-check editorial content to ensure the information you’re reading is accurate. We maintain a firewall between our advertisers and our editorial team. Our editorial team does not receive direct compensation from our advertisers.
Editorial Independence
Bankrate’s editorial team writes on behalf of YOU – the reader. Our goal is to give you the best advice to help you make smart personal finance decisions. We follow strict guidelines to ensure that our editorial content is not influenced by advertisers. Our editorial team receives no direct compensation from advertisers, and our content is thoroughly fact-checked to ensure accuracy. So, whether you’re reading an article or a review, you can trust that you’re getting credible and dependable information.
How we make money
You have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey.
Bankrate follows a strict editorial policy, so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers.
We’re transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money.
Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service.
Insurance Disclosure
This content is powered by HomeInsurance.com, a licensed insurance producer (NPN: 8781838) and a corporate affiliate of Bankrate.com. HomeInsurance.com LLC services are only available in states were it is licensed and insurance coverage through HomeInsurance.com may not be available in all states. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.
Get insurance quotes
Simply answer some questions to personalize your offer. Then, you’re on the road to savings! Let’s start here:
Compare offers from top carriers
how it works
Tell us a little about yourself
We’ll only ask for info we’re confident will impact your rate. That way, we can provide you with the most accurate and personalized offers.
Choose which policy is best for you
Compare your options from a list of carriers who want to get you insured. You can then move forward with as many as you’d like.
Lock in your rate and policy details
Once you’re confident in your selected carrier, finish up the process online or on the phone with a trusted agent. And that’s it!
Car insurance provides a financial safety net and can help protect your finances from losses due to accidents. Auto insurance coverage is vital to your overall financial health, so finding the right company for your needs is an important task. To help you in your search, Bankrate analyzed average quoted premiums, obtained from Quadrant Information Services, for hundreds of insurance companies. We also reviewed available coverage options, discounts, digital resources and third-party customer satisfaction and financial strength ratings in our quest to find the best car insurance companies.
How Bankrate evaluated the top car insurance companies: Our insurance editorial team keeps pace with the auto insurance market to ensure we choose carriers based on factors that matter most to consumers, as informed by our team of insurance experts. Our research could help you find the best auto insurance options for your unique circumstances. Shopping around is one of the most impactful strategies to find the best car insurance company for your needs and budget, especially as rates rise to keep pace with inflation, supply chain issues and changing driving habits.
This advertising widget is powered by HomeInsurance.com, a licensed insurance producer (NPN: 8781838) and a corporate affiliate of Bankrate. The offers and clickable links that appear on this advertisement are from companies that compensate Homeinsurance.com LLC in different ways. The compensation received and other factors, such as your location, may impact what ads and links appear, and how, where, and in what order they appear. While we seek to provide a wide range of offers, we do not include every product or service that may be available to you as a consumer. We strive to keep our information accurate and up-to-date, but some information may not be current. Your actual offer terms from an advertiser may be different than the offer terms on this widget. All offers may be subject to additional terms and conditions of the advertiser.
Compare auto insurance rates
Answer a few questions to see personalized rates from top carriers
Please select age
Save on auto insurance with quotes from trusted providers like
This advertising widget is powered by HomeInsurance.com, a licensed insurance producer (NPN: 8781838) and a corporate affiliate of Bankrate. HomeInsurance.com LLC services are only available in states where it is licensed and insurance coverage through HomeInsurance.com may not be available in all states. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.
When reviewing multiple auto insurance companies, using an apples-to-apples comparison can be helpful. Knowing how to find companies that could meet your needs and how to compare those companies can be an important skill to have. While an average annual premium estimate may be a good initial indicator of how a company will stack up against others, it doesn’t provide the full story. Quotes should ideally include the same coverage levels and types, with the same personal details and vehicle information given to each company. Depending on your preferences, you may also want to review trusted third-party ratings for an additional assessment of a company’s performance, such as J.D. Power customer satisfaction ratings, the National Association of Insurance Commissioners (NAIC) consumer complaint index and financial strength grades from multiple credit rating agencies. This information can be found online, or an insurance agent can help you obtain this type of information about the auto insurers you are interested in.
How Bankrate picked the best auto insurance companies for 2022
To provide an easy-to-use shopping and comparison tool for consumers, we calculated a Bankrate Score out of 5.0 total points. The higher a company’s Bankrate Score, the more competitively that company ranked in each scoring category. Our picks highlight auto insurers that:
Carry an “Excellent” or “Superior” financial strength rating from AM Best
Have a strong digital presence with a consumer-friendly mobile app or digital policy management features
Are deemed by Bankrate to be the best in a particular market category
Bankrate utilizes Quadrant Information Services to analyze 2022 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted based on the population density in each geographic region. Quoted rates are based on a 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:
$100,000 bodily injury liability per person
$300,000 bodily injury liability per accident
$50,000 property damage liability per accident
$100,000 uninsured motorist bodily injury per person
$300,000 uninsured motorist bodily injury per accident
$500 collision deductible
$500 comprehensive deductible
To determine minimum coverage limits, Bankrate used minimum coverage that meets each state’s requirements. Our base profile drivers own a 2020 Toyota Camry, commute five days a week and drive 12,000 miles annually. These are sample rates and should only be used for comparative purposes.
J.D. Power scores
J.D. Power is a global market research company that has decades of experience within the automotive, financial and health industries, among others. It conducts annual surveys on customer satisfaction across these sectors to help provide insight into the qualities that matter most between consumers and businesses. Its auto insurance studies take into account customer satisfaction across several categories that impact consumers, including customer service, claims processing, policy offerings and premiums, which make its scores a useful qualitative tool in assessing auto insurers.
Bankrate Scores primarily reflect a weighted rank of industry-standard ratings for financial strength and customer experience in addition to analysis of quoted annual premiums from Quadrant Information Services, spanning all 50 states and Washington, D.C. We know it is important for drivers to be confident their financial protection covers the likeliest risks, is priced competitively and is provided by a financially sound company with a history of positive customer support and claims-paying ability. In our evaluation, third-party ratings from J.D. Power, AM Best, Standard & Poor’s, National Association of Insurance Commissioners and Moodys had a significant impact on the companies’ Bankrate Scores. Our top picks for “best for” reflect a combination of Bankrate Scores and availability to drivers around the country, in addition to the specific qualities associated with each company. *Scores reflect the company’s performance in states available.
Answer a few questions to see personalized rates from top carriers
JD Power:
909/1000
AM best:
A++
Avg. annual premium for minimum coverage:
$354
Avg annual premium for full coverage:
$1209
Why this company made our list: With the highest Bankrate Score of the auto insurers Bankrate analyzed, USAA easily makes our list of best insurance companies for nationwide availability and top tier customer service. Although only available only to current or former military members and their eligible families, USAA is a top scorer in J.D. Power customer satisfaction surveys, has impeccable financial strength as rated by AM Best, S&P and Moody’s, and still manages to provide some of the lowest-priced auto insurance quotes in the industry.
Why USAA is best overall for car insurance: USAA earns top marks from all major third-party rating agencies for customer service and financial strength. Coupled with having the lowest average full coverage premium on our list, customers are privy to multiple coverage options, rewards and discounts, including unique circumstances like deployment for active-duty members. While not all drivers may qualify for coverage from USAA, the company is a standout for millions of military families across the country.
Perks
Excellent customer service scores and financial strength ratings
Low average rates
Military-focused coverage options
Drawbacks
Only available to active-duty military, veterans and immediate family members
Fewer specialty coverage options than other carriers
Answer a few questions to see personalized rates from top carriers
JD Power:
N/A
AM best:
A-
Avg. annual premium for minimum coverage:
N/A
Avg annual premium for full coverage:
N/A
Why this company made our list: Clearcover’s technology-driven car insurance is reinventing the insurance landscape, making it a clear contender for any driver seeking the best modern auto insurance experience compared to other car insurance companies. The insurtech company’s digital approach allows it to sell highly affordable policies.
Why Clearcover is best for digital presence: Although only currently available to drivers in 20 states, Clearcover is disrupting the auto insurance market by putting technology in the spotlight. The carrier uses artificial intelligence-based digital tools to its advantage, revamping how car insurance is quoted, purchased and serviced. Clearcover’s highly-rated mobile app puts control over managing policies directly in users’ hands. The streamlined approach enables Clearcover to pay most auto claims in less than a week, with some even being eligible for same-day processing.
Perks
Cutting-edge technology
Fast insurance quotes and expedient claims processing
Drawbacks
Only available in 20 states
Limited data regarding customer satisfaction
Policyholders seeking a technology-driven insurance experience
Answer a few questions to see personalized rates from top carriers
JD Power:
871/1000
AM best:
A++
Avg. annual premium for minimum coverage:
$354
Avg annual premium for full coverage:
$1297
Why this company made our list: Geico’s long history as a trusted, household-name auto insurer is reflected in its high Bankrate Score and is one of the reasons we included it as a top company. Coverage is available for virtually every type of driver, making its car insurance coverage accessible even for consumers with blemished driving histories.
Why Geico is best for driving incidents: Geico is one of the few top auto insurance companies that will write policies for drivers even after high-risk incidents, such as DUI convictions. While high-risk policies are generally more expensive, a high-risk driver may also have a harder time finding coverage, especially from major car insurance companies. Geico is an easily-accessible option for most people.
Perks
Typically available to high-risk drivers
Highly rated digital app and mobile tools
An array of discounts
Drawbacks
Customer service scores vary by region
Fewer coverage options
Fewer in-person local agents compared to other car insurance companies
Answer a few questions to see personalized rates from top carriers
JD Power:
892/1000
AM best:
A++
Avg. annual premium for minimum coverage:
$456
Avg annual premium for full coverage:
$1397
Why this company made our list: As the largest national auto insurer based on market share, State Farm’s reach and reputation highlight the carrier as one of the best auto insurance companies for drivers in most states. Its extensive local agent network showcases its customer-first approach to providing a variety of personal and commercial insurance products to consumers
Why State Farm is best overall for car insurance: State Farm company boasts over 19,000 licensed insurance professionals, available in communities across the U.S., who can offer guidance to those who value expert insight when discussing their policy. Digital management options allow for an on-the-go approach, including a highly-rated mobile app where you can file auto claims and contact your agent.
Perks
Large network of local agents
Excellent financial strength
Drawbacks
May not be available to high-risk drivers
Higher-than-average compliant index score with the National Association of Insurance Commissioners (NAIC)
Answer a few questions to see personalized rates from top carriers
JD Power:
871/1000
AM best:
A++
Avg. annual premium for minimum coverage:
$477
Avg annual premium for full coverage:
$1447
Why this company made our list: Travelers is a trusted insurer with over 150 years in the auto insurance industry. Its strong independent agent network, numerous endorsement options, robust savings opportunities and proven financial track record make it a worthwhile option for drivers nationwide
Why Travelers is best for personalized coverage: Travelers’ average full coverage car insurance rates come in a bit higher than the national average, but that could be because the carrier offers so many ways to customize your coverage to your specific needs. Options like new car replacement, accident forgiveness, rideshare coverage and gap coverage will add more premium to your policy but will also give you financial protection for a broader range of incidents. Travelers’ claims satisfaction is not as highly ranked by customers compared to other companies Bankrate analyzed, which may be worth considering before you purchase a policy.
Answer a few questions to see personalized rates from top carriers
JD Power:
901/1000
AM best:
A+
Avg. annual premium for minimum coverage:
$476
Avg annual premium for full coverage:
$1321
Why this company made our list: We included Erie on our list of the best auto insurance companies because this regional insurer is generous with optional coverage types in its policies and scores competitively across all third-party agencies reviewed in our research. Erie also offers discount advantages and competitive rates for young drivers who normally see the highest rates of all driver age groups. Erie’s high Bankrate Score contributes to its position on our list of best auto insurance companies for 2022, although coverage is not available nationally.
Why Erie is best for robust coverage: Erie automatically includes several coverage types and features in its full coverage policies that many competitors only offer as optional add-ons. Drivers can benefit from included rideshare insurance, accident forgiveness and Erie’s Rate Lock feature, which could help keep your premiums consistent over time. While only available in 12 states, the company provides robust coverage and a strong claims experience for drivers in its service areas.
Perks
Rate Lock feature could help keep premiums steady
Highly-rated customer service
Drawbacks
Coverage only available in 12 states
Below-average ranking for customer experience with digital insurance shopping
Answer a few questions to see personalized rates from top carriers
JD Power:
878/1000
AM best:
A++
Avg. annual premium for minimum coverage:
$325
Avg annual premium for full coverage:
$1305
Why this company made our list: Auto-Owners is another carrier with a strong reputation for providing excellent auto coverage and earned the second-highest J.D. Power claims satisfaction rates of any company on our list of best auto insurance companies. Its wide range of coverage and discount options are available to drivers in 26 states.
Why Auto-Owners is best for discounts: Auto-Owners offers an impressive menu of 12 discounts, which many drivers are likely eligible to receive. Drivers could save by getting a quote ahead of their current policy’s expiration, or by opting for paperless billing and payment options. The company provides three types of student discounts, making it a great option for parents of teens or young drivers who have their own policy to consider.
Answer a few questions to see personalized rates from top carriers
JD Power:
895/1000
AM best:
A+
Avg. annual premium for minimum coverage:
$444
Avg annual premium for full coverage:
$1495
Why this company made our list: Amica’s standout claims service and customer-centric business model make it a standout choice, based on Bankrate’s analysis, for drivers seeking the best auto insurance company.
Why Amica is best for claims satisfaction: Amica ranks as the second-highest scoring carrier for claims satisfaction out of the top auto insurers surveyed by J.D. Power, earning 32 points above the industry average. The company’s online claim center allows customers to easily report a claim, upload supporting documents and track the claim’s process with a few simple clicks. Its customer representatives are available to support policyholders 24/7.
Answer a few questions to see personalized rates from top carriers
JD Power:
876/1000
AM best:
A+
Avg. annual premium for minimum coverage:
$549
Avg annual premium for full coverage:
$1383
Why this company made our list: Nationwide’s options to tailor coverage based on personal needs in addition to its low average premium solidify it as a top auto insurance company for 2022, based on Bankrate’s research. With near-nationwide availability and a website full of useful insurance information, customers are likely to find the answers they need to customize a Nationwide policy to their exact needs.
Why Nationwide is best for coverage on a budget: Nationwide’s average annual premium is the second-lowest on our list, only below USAA. However, Nationwide doesn’t restrict coverage to military-affiliated policyholders, so it could be an option for cheap rates if you don’t qualify for USAA. Additionally, the carrier’s SmartRide and SmartMiles telematics programs can help you either earn a discount based on your safe driving habits or provide a flexible premium based on your vehicle usage, respectively. Optional coverage is not as plentiful as some other auto insurers on our list, but personalized options offer valuable control over your financial protection.
Perks
Two usage-based driving programs could offer highly personalized rates
Answer a few questions to see personalized rates from top carriers
JD Power:
862/1000
AM best:
A+
Avg. annual premium for minimum coverage:
$542
Avg annual premium for full coverage:
$1561
Why this company made our list: Progressive’s handy rate tools and positive customer satisfaction help secure it as one of our best car insurance selections. Consumers can find options to save based on their own budget and driving habits with a Progressive policy anywhere in the U.S., backed by a financially strong company that earns high ratings from third-party agencies.
Why Progressive is best for digital policy management: Progressive provides several ways for drivers to save time and money by managing their policy online, such as its Snapshot app, which is a telematics program that monitors driving and offers discounts for safe driving. Even when first deciding what is the right policy for you, you can use its online Name Your Price tool to personalize your buying experience and review coverage options based on your budget. The Progressive mobile app offers instant access to review coverage, ID cards, bill payment and claims submissions..
Perks
Strong digital tools
Unique points-based rewards program
Two usage-based driving programs could help customize rates
Answer a few questions to see personalized rates from top carriers
JD Power:
870/1000
AM best:
A+
Avg. annual premium for minimum coverage:
$558
Avg annual premium for full coverage:
$2438
Why this company made our list: As the fourth-largest insurer based on market share, Allstate has a long list of valuable coverage options that make it a standout option for many drivers, but especially for those with unique vehicles. Allstate’s rewards program adds additional benefits, allowing drivers to earn points toward hotels, gift cards and other great perks.
Why Allstate is best for high-value cars: Allstate is one of the few insurers that offer coverage for custom equipment. The company’s full coverage policies have a higher average cost compared to other carriers on Bankrate’s list, but drivers who have invested money into modifying their vehicles with the best sound equipment likely need more extensive coverage, which Allstate provides. Classic and antique car collectors can opt for Allstate’s classic car insurance so the vehicle’s higher intrinsic value is accounted for in case of costly damage.0
Perks
Classic or custom car coverage
Unique points-based rewards program
Two usage-based driving programs could help customize rates
When answering the common question “how much is car insurance,” it’s important to know that rates are highly dependent on the personal rating factors and vehicle information drivers provide when submitting for a quote. Nationally, full coverage policies average $1,771 per year. “Full coverage” refers to a policy that includes liability, collision coverage and comprehensive coverage. Minimum coverage, which refers to a state’s minimum requirements, costs an average of $545 per year.
In addition to the coverage types and levels you choose, other factors will significantly influence your final insurance cost. Insurers base car insurance rates on a perceived level of risk, which means that the following factors (and more) can impact your premium:
Driving record: If you have a history of accidents, tickets or DUI convictions, you’ll likely pay more for coverage.
Age and driving experience: Younger drivers tend to have less experience on the road, which means accidents are more likely and rates are usually higher than average. Hawaii and Massachusetts ban the use of age as a rating factor.
State and city: Different states have different insurance laws, different accident statistics and different costs of living. Even your city and ZIP code (in most states) can influence how much you pay.
Coverage types and levels: Choosing fewer coverage types and lower limits will generally mean a lower premium, but it also means less financial protection and higher out-of-pocket costs if you have an accident.
Vehicle make and model: Each make and model of vehicle has unique features which impact the likelihood of accidents, the severity of accidents and the cost to repair the vehicle itself. Because of this, each vehicle will cost a different amount to insure.
Credit-based insurance score: In most states, your credit tier is used to determine how likely you are to file a claim. Drivers with lower credit scores generally pay higher premiums.
Insurance lapse history: Because most states require drivers to have at least minimum levels of coverage, lapses in insurance can result in higher premiums when you take out a policy again.
How much is car insurance with driving incidents?
The table below shows the average rate for drivers with several different scenarios. Compared to the national average rate, you can see that different factors affect premiums differently.
Drivers with…
Average annual full coverage premium
A lapse in coverage
$1,949
One speeding ticket
$2,138
One at-fault accident
$2,521
One DUI conviction
$3,421
Poor credit
$3,002
Why location matters when choosing car insurance
Auto insurance rates are based on several factors, and your city, state and ZIP code are among the most impactful. If you recently moved, it may be a good idea to compare companies to ensure that your car insurance provider is still the best fit for your needs. This is especially true if you have moved across state lines, as auto insurance is not standardized across the country.
Adding a comprehensive review of your auto insurance coverage as part of your moving checklist is a good way to remember this important step. To view Bankrate’s picks for the best car insurance in your state, select it from the table below.
Average cost of car insurance by state
State
Annual annual cost for full coverage insurance
Average annual cost for minimum coverage insurance
Auto insurance is a form of financial protection that covers a variety of vehicle incidents that could affect you, your vehicle, or others and their vehicle.While most states require a specific minimum amount or type of coverage to be purchased, industry experts typically recommend having more robust financial protection to protect your finances in the event of a costly loss.
Auto policies will cover certain incidents of injury, damage or liability. Coverage limits can be set to satisfy your preferred level of financial protection, though not all coverage types will apply in all states or for all policies. In addition, deductibles are specific to certain coverage types. Because a higher deductible means you are willing to pay more if you file a claim, selecting a higher deductible can lower your premium cost.
More than a dozen rating variables unique to each driver go into determining how much you pay for auto insurance. As each carrier uses different rating factors and weights when underwriting policies, comparing quotes from multiple insurers is often essential in finding the most affordable rate.
While your exact level of coverage will depend on the policy you choose, filing a claim could potentially offer you a payout for loss caused by an uninsured motorist, weather event, occurrence of theft or vandalism, or a multitude of other damaging events. Similarly, if you are involved in an accident with another driver and they are at fault, their auto insurance could help cover your medical expenses and property damage (depending upon the state).
What are the different types of car insurance coverage?
Most auto insurance companies offer similar types of coverage, although variations do exist, especially with endorsements, or “add-ons.” Some companies might offer gap coverage as an option, for example, while another company doesn’t. Below are the types of car insurance coverage that most companies offer:
Almost always required by law
In most states, drivers are legally required to carry at least certain minimum limits of these coverage types
Property damage liability coverage pays for the damage you cause to another’s vehicle or other property (like a fence, pole or building) in an at-fault accident.
Personal injury protection (PIP), also known as no-fault insurance and offered only in certain states, pays for medical expenses you and your passengers incur following an accident, regardless of fault. It also accounts for non-medical expenses incurred as a result of an accident, such as lost wages or the cost of childcare. PIP is typically required in no-fault states.
Medical payments coverage is similar to PIP insurance coverage but includes only payments for medical expenses. It is required in some states and optional in others.
Required if you have a loan or lease If you finance or lease your car, your financial institution will likely require that you have a “full coverage” policy, which includes the following coverage types and adds coverage for damage to your vehicle:
Collision coverage pays for damages to your vehicle caused by a collision. If you collide with another car, a tree, a pole, a building or a pedestrian, your collision coverage is the part of the policy that will pay for the damage to your vehicle.
Comprehensive coverage pays for damage to your car caused by non-collision losses like theft, vandalism and storm damage. Comprehensive also pays for damages caused by hitting an animal and cracked windshields. According to the Triple-I, approximately 80% of drivers carry this optional coverage.
However, there are more types of car insurance coverage available to you that may be worth discussing with your insurer. Additionally, each state has its own car insurance laws and each driver has a unique situation. Talking with a licensed agent can help you determine the best coverage types and limits for your needs.
What are the different types of car insurance discounts?
Finally, most major auto insurers offer the following car insurance discounts that might help you lower your premium:
Multi-policy, sometimes called multi-line or bundling, could earn you a discount on each policy you insure with the same company. This discount is common for insuring both a home and auto policy but is also sometimes offered for having other policies as well, like renters insurance, pet insurance or life insurance..
Multi-car discount could save you money if you insure more than one vehicle on the same policy.
Claims-free is commonly offered if you do not have any losses on your driving record for three to five years.
Good student discount is usually available for full-time students under the age of 25 who have a certain grade point average or letter-grade average.
Telematics programs are becoming more common with many car insurance companies. These usage-based insurance programs track your driving patterns with a mobile app or plug-in device. The safer you drive, the more you might save.
Keep in mind that insurance regulations vary by state. This means that some coverage types and discounts may not be available where you live.
Frequently asked questions
Yes, car insurance is required. Drivers must carry at least the required minimum amount of car insurance in all states except New Hampshire and Virginia. Each state sets its own car insurance laws, which means minimum limits vary by state. However, it’s worth noting that while minimum limits are all you need to drive legally, you will need to add comprehensive and collision coverage if you have a loan or lease on your vehicle. Additionally, most insurance agents recommend that you purchase higher liability limits for more financial protection. State minimum limits tend to be quite low and give you very little coverage.
Generally, the more accidents you have on your record, the higher your premium will be.Car insurance companies often use a Comprehensive Loss Underwriting Exchange (C.L.U.E.) report and motor vehicle report (MVR) to help determine rates. These reports include information regarding your prior accidents, traffic violations, license status, claims history and other pertinent details of your driving history. However, many carriers offer accident forgiveness as an endorsement. If you are involved in an accident, your auto insurer may “forgive” your incident instead of increasing your rates. Accident forgiveness doesn’t transfer to other carriers, so that accident will likely affect your rates if you switch companies.
According to our research, Auto-Owners, USAA and Geico are among the cheapest car insurance companies in 2022. However, rates vary based on a number of underlying rating metrics, so the cheapest company for you may not be included on this list. One of the best ways to find the lowest premium is to shop around and compare quotes.
Having the best auto insurance coverage can be an important component of establishing financial peace of mind for you and your family. While state requirements vary, it is almost always a safer bet to have an appropriate level of coverage to protect your money and assets. John Colletti, adjunct business professor at North Central College, recommends beginning the task of learning the important role auto insurance plays in providing financial protection as early as you can drive. “As families discuss a child’s registration to driver education class, include a talk explaining monetary considerations and important terms to improve financial literacy,” Collettti says. He explains that doing so can help young drivers grasp the concept of vehicle ownership and other important topics that impact your financial health.
The level of car insurance coverage you choose to purchase is highly personal and based on several factors. Your overall financial health, your level of risk tolerance, the types and amounts of the assets you need to protect, and your driving metrics like your accident history and the type of car you drive can all impact your decision. One of the best ways to know how much coverage is right for you is to work with a licensed insurance agent as you are getting quotes.
Angelica Leicht is an insurance editor on the Bankrate team. She is truly passionate about helping readers make well-informed decisions for their wallets, whether the goal is to find the right comprehensive auto policy or the best life insurance policy for their needs.
Reviewed By
Mark FriedlanderDirector of corporate communications, Insurance Information Institute
Mark Friedlander is director of corporate communications at III, a nonprofit organization focused on providing consumers with a better understanding of insurance.