Auto insurance is not always cheap, but can save you significantly in the long run when trying to expense vehicle repairs, replacement and other accident-related damages. Moreover, driving legally in most states requires having adequate coverage and failing to do so can result in penalties, such as fines and license suspension. Car insurance can cost you an average of $1,674 per year or about $140 per month for full coverage, helping you create a financial safety net and avoid unnecessary fees associated with being an uninsured driver.
Many drivers may find it challenging to narrow down which companies offer the cheapest car insurance. Because of this, some drivers may opt for the lowest amount of coverage required by the state (some states like New Jersey may have several options for required minimum coverage). The national average cost of minimum coverage is $565 annually, or $47 a month.
However, rates are personalized to each driver based on multiple factors, making finding cheap car insurance possible when you know how to search for and compare providers. To help you in your insurance shopping journey, Bankrate’s insurance editorial team evaluated average premiums from multiple providers, customer service ratings and rates for different driving records to determine the most affordable coverage.
In this article…
- Cheap car insurance companies
- Cheap car insurance rates by state
- How to find cheap car insurance
- Frequently asked questions
Cheap car insurance companies
Finding cheap auto insurance companies is relatively simple to find once you know what you are looking for and which factors help you get an affordable auto insurance premium.
Cheapest car insurance rates from larger companies
Many drivers choose to insure their vehicle with a large or national provider due to their strong reputations. We evaluated major auto insurance companies (by market share) based on average premiums, coverage options and discounts to find the cheapest rates. We also considered third-party customer satisfaction ratings from two 2020 J.D. Power studies — the Auto Claims Study and Auto Insurance Study — to account for each provider’s quality of service.
The table below provides an initial point of comparison between the top providers offering competitive rates. Alongside their average premiums is a Bankrate Score calculated based on the above-mentioned factors and financial strength. While these companies may score differently according to your personal insurance needs, you can use our Scores to help decide which ones you want to pursue for the best car insurance at an affordable rate. We found Auto-Owners and Amica offer the cheapest average premiums for minimum coverage overall, based on quoted annual premiums. However, USAA offers one of the lowest average annual rates for qualifying military members and their families.
|Insurance company||Average 6-month premium for minimum coverage||Average annual premium for minimum coverage||Bankrate Score|
If you prefer working with a local agent over using digital tools, Auto-Owners has independent representatives in each of the 26 states it serves. With over 100 years in the insurance industry, it ranks third out of 24 providers in J.D. Power’s claims satisfaction study and offers numerous policy options, discounts and some of the cheapest rates for minimum coverage. Auto-Owners also offers useful add-ons such as gap insurance and lock rekeying.
In addition to common auto insurance discounts, Auto-Owners also offers discounts for paperless billing and teen driver monitoring. The provider already offers the lowest annual minimum coverage rates on our list at $382.
Learn more: Auto-Owners insurance review
If you are an active or retired member of the military, USAA is a great company to consider for cheap car insurance rates and good coverage. USAA’s average annual premium for minimum coverage insurance is $384, tied for the second lowest rates on our list. Available across the country, USAA scores highly in claims satisfaction with 890 out of 1,000 points, more than any other company surveyed (though it is technically rank-ineligible due to eligibility requirements). In addition to the usual coverage options, USAA offers some additional features like accident forgiveness and rideshare coverage.
As a new savings feature, USAA’s SafePilot app allows policyholders to save up to 30% on premiums during policy renewal for safe driving habits tracked throughout the term. Additional discounts are available for family sign-ups, policy bundling and garaging your car on a military base.
Learn more: USAA insurance review
The oldest mutual auto insurance company in the U.S., Amica has been in business for over a century and its car insurance rates are still among the cheapest, at $405 annually for minimum coverage car insurance. Aside from the basic coverage options, Amica also offers a range of additional options such as glass coverage, free lock replacement, new vehicle replacement without a deductible and up to $1000 in bail bonds.
Available to drivers nationwide (though currently unavailable in Hawaii), Amica allows policyholders to save money with the help of common discounts like bundling policies, being a homeowner or being a good student. The provider also rewards loyalty and legacy, so policyholders may earn additional savings if they have been a customer for over two years or if their parents have had a policy with the company for five years.
Learn more: Amica insurance review
Although only available in 12 states and Washington D.C., Erie consistently performs well with both its prices and customer service. Not only does Erie have some of the cheapest average minimum coverage rates among larger carriers at $409 annually, it also offers plenty of optional coverages and features that make its price point even more worthwhile.
Options like accident forgiveness, rental reimbursement, travel expenses and pet injury coverage are available in addition to the standard coverage options. Erie also has a unique Rate Lock feature that allows the policyholder to lock in their premium and coverage until they add or remove a driver or vehicle or change their primary residence.
Affordable premiums combined with discount options like having multiple safety features installed makes Erie one of our top considerations for those on a budget.
Learn more: Erie insurance review
Geico is offered in all 50 states and Washington, D.C., has an AM Best financial strength rating of an A++ (Superior), and ranks highest within the North Central and Northwest regions for overall auto insurance satisfaction with J.D. Power. This provider rounds out our list of cheapest large car insurance companies with a rate of $433 annually for minimum coverage. In addition to offering competitive and often cheap car insurance premiums and its high ratings for financial strength and customer service, Geico’s mobile app also makes it easy to ask questions to a virtual assistant, call roadside assistance, pay bills and download documents.
Beyond that, a variety of incentives make Geico an excellent choice to consider for car insurance. It offers rideshare insurance in select states, accident forgiveness coverage and several discounts for anti-theft devices, good drivers, good students, military, having multiple policies, prepayment and vehicle safety equipment.
Learn more: Geico insurance review
Cheapest car insurance rates from smaller companies
Some drivers looking for cheap car insurance may find it useful to get a quote from companies with a smaller market share. While not always the case, small and local providers may be able to offer more affordable auto insurance and personalized coverage than larger insurers.
|Small insurance company||Average 6-month premium for minimum coverage||Average annual premium for minimum coverage|
|Nodak Insurance Company||$82||$164|
It is possible that some of these companies sound familiar while others do not. Due to less advertising and overhead costs, many are able to offer even more competitive premiums than their larger counterparts. Though there are typically fewer available discounts, smaller insurance companies may also offer more savings for loyalty and keeping a policy with them for several years. Because of this, these companies are usually worth consideration when looking for the cheapest auto insurance.
Cheap car insurance by driving history
Although maintaining a clean driving record is one of the best ways to keep your car insurance premiums low, accidents happen. There are providers that have minimal spikes in comparison to other competitors for at-fault accidents, and some providers offer accident forgiveness if you do not have accidents often.Multiple incidents on your driving record may make you eligible for high-risk, or non-standard, insurance. While this has many impacts, one of the most immediate is increased insurance rates.
Drivers with high-risk status are likely to see reduced coverage amounts with liability-only insurance, in which case purchasing full coverage may be preferable for additional financial cushioning.Below are the five popular cheap providers pulled from our table above and each company’s average monthly rates for full coverage car insurance for a driver with a clean record and after one speeding ticket, at-fault accident or DUI.
|Insurance company||Clean driving record||One speeding ticket||One at-fault accident||One DUI|
Cheap car insurance rates by state
The car insurance companies mentioned below offer affordable car insurance for drivers in each part of the nation. However, keep in mind that each state has its own insurance factors and requirements for car insurance, which will also impact your final rate. Across several states, USAA proves itself to be one of the cheapest options available for car insurance — generally offering rates well below the state average. However, because it only provides coverage for qualifying military, veteran and family members, it is not included in the table below. Geico provides the cheapest average rates for drivers in most states.
|State||Cheapest car insurance company||Average annual minimum coverage premium|
|Arkansas||Southern Farm Bureau||$316|
|Iowa||Iowa Farm Bureau||$212|
|Kansas||Iowa Farm Bureau||$325|
|Nebraska||Iowa Farm Bureau||$271|
|New York||Main Street America||$304|
|South Carolina||American National||$227|
|South Dakota||Farmers Mutual of Nebraska||$172|
How to find cheap car insurance
Although price is an important factor, it could cost you more out of pocket in the long run if you purchase low coverage amounts up front. To help avoid being personally financially responsible for a claim while still keeping affordable coverage in mind, you might consider looking for providers with lower average full coverage premiums and extensive discounts for which you qualify.
To find cheap insurance, consider including these steps in your search:
Know the difference between minimum coverage and full coverage
Saving money on car insurance is a priority for many, but more often than not, the cheapest coverage also provides the least amount of protection. Each state will have its own minimum insurance requirements for bodily injury and liability protection, which often lead to a cheap car insurance quote when purchased alone.
While these minimums will make you road-legal, they are not enough to cover the full extent of an accident. Liability-only insurance leaves your vehicle without coverage for any damage to it, potentially causing financial strain following an incident. Insurance experts typically recommend purchasing collision and comprehensive coverage — commonly known as full coverage — to offer the greatest financial protection for both your vehicle and yourself. Many insurers even offer discounts that only apply to policies with full coverage inclusions.
Research alternative companies for affordable car insurance
Aside from choosing particular coverage amounts, you may also want to consider non-traditional insurance providers or programs. For example, Cure is a small provider that serves drivers in New Jersey and Pennsylvania with lower than average credit scores. Instead of using poor credit history as a determining factor, it provides rates by prioritizing your driving history. Clearcover is another alternative provider with limited state availability, but it is able to offer competitive rates by operating as a digital-first company.
Consider a usage-based car insurance policy
Usage-based car insurance policies exist to help incentivize safe-driving habits and reward drivers with discounts the more they exhibit them. By installing a telematics device or using your phone to track your driving, you could earn discounts for behaviors like smooth braking, driving within speed limits and having low annual mileage. Many large providers offer usage-based programs, such as Progressive’s Snapshot or Geico’s DriveEasy.
Frequently asked questions
Who has the cheapest car insurance?
Car insurance rates can vary from one person to another depending on factors like location, age and driving record. Shopping around and comparing quotes based on your personal needs is usually the best way to find the most affordable car insurance for you. Many of the providers mentioned above offer affordable coverage for various types of drivers.
Is the minimum required insurance in my state enough coverage?
While your state may only legally require you to carry a minimum of liability coverage and bodily injury coverage, insurance experts recommend opting for additional coverage to offer fuller protection in case of an accident. Figuring out exactly how much coverage you need can be tricky, but it can be helpful to understand what comprehensive and collision coverage are as a starter.
Collision coverage helps pay for damage caused to your vehicle in an accident. Comprehensive coverage chips in for vehicle damage resulting from non-collision events such as theft, falling objects and storms. If you are unsure how much coverage you need, speak with an insurance agent who can review your circumstances and recommend the best options for you.
Does old age affect car insurance rates?
Your ability to find cheap car insurance might largely depend on your age. Car insurance rates typically peak and drop at certain ages. Generally, premiums are more expensive the younger you are — especially for inexperienced teen drivers — and then begin decreasing between the ages of 25 and 60. However, senior-aged drivers may begin to see rate increases around age 70 due to an increased likelihood of accidents and insured risk.
Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. 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 coverages that meet each state’s requirements. Our base profile drivers own a 2019 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.
Incident: Rates were calculated by evaluating our base profile with the following incidents applied: clean record (base), at-fault accident, single speeding ticket, single DUI conviction and lapse in coverage.
Bankrate scores primarily reflect a weighted rank of industry-standard ratings for financial strength (AM Best, S&P, Moody’s) and customer experience (J.D. Power, NAIC), in addition to average quoted rates from Quadrant Information Services. The J.D. Power studies utilized include the 2020 Auto Insurance Study and the 2020 Auto Claims Study. Our Bankrate editorial team’s extensive research and analysis provided a secondary assessment of each insurer’s online and mobile resources and policy management options, which also contributed to overall ratings.