In many cases, auto insurance isn’t considered particularly cheap. But driving legally in most states requires having adequate insurance coverage — failing to do so resulting in penalties, such as fines and license suspension. Finding cheap car insurance is a top priority for most drivers, but with so many companies and a variety of pricing and coverage options, it becomes difficult to navigate the market for the right fit.
Comparing quotes from multiple companies is one of the best ways to find the cheapest car insurance available to you. But along with cost, it’s important to compare coverage options to make sure you aren’t underinsured. We evaluated the major auto insurance companies (by market share) based on coverage, discounts, customer service and satisfaction and third party ratings to find the cheapest rates. The table below provides an initial point of comparison of our top providers offering the most competitive rates.
Best cheap car insurance
|Insurance company||Yearly premium for minimum coverage||J.D. Power Rating|
Quadrant Information Services, 2020
Although only available in 12 states and Washington D.C., Erie Insurance consistently performs well with both prices and customer service. Not only does Erie have the cheapest average minimum coverage rates, it also offers plenty of perks to make the deal sweeter.
Options like accident forgiveness, glass repair, locksmith service, rideshare coverage, 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 a vehicle, or change their primary residence.
Besides the diverse coverage selection, Erie also offers a few valuable discounts on auto insurance, such as bundling home and car insurance, not using a vehicle for up to 90 days, paying the annual premium in full, insuring more than one vehicle and having multiple safety features installed in the car. The affordability of rates combined with discounts makes Erie our top consideration for those on a budget.
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. Ranked number one in Central U.S. for overall customer satisfaction, Auto-Owners has been in business for over 100 years and offers numerous policies, discounts and some of the cheapest rates for minimum coverage. Apart from the standard liability, comprehensive and collision coverages, Auto-Owners also has add-ons such as GAP insurance, rental car insurance, identity theft protection, cell phone replacement and rekeying of locks.
Standard auto insurance discounts are also offered: safety features, multi-policy, multi-car and student discounts. Additionally, a green discount for paperless billing and teen driver monitoring discount are available, which are less common in the industry.
Since Auto-Owners has several different lines of insurance, bundling your policies can also get you a price cut. Paying your premiums on time for three years is another way to leverage additional savings with Auto-Owners.
Geico has an AM Best financial strength rating of an A++ (Superior), and ranked highest within the 2020 J.D. Power study for auto insurers in the north-central and northwest regions of the United States. In addition to competitive rates and high ratings for financial strength and customer service, Geico’s mobile app makes it easy to ask questions to a virtual assistant, call roadside assistance, pay bills and download documents. By going virtual and cutting out insurance agents and offices, Geico keeps its car insurance pricing competitively low.
Beyond that, a variety of incentives make Geico an excellent choice 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.
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. Aside from the basic liability and bodily injury coverage, Amica also offers a range of additional options such as personal injury protection, collision and comprehensive coverage, roadside assistance, glass coverage, free lock replacement, no depreciation for a totaled new vehicle and up to $1000 in bail bonds.
Amica also allows customers to save money with the help of standard discounts for bundling policies, being claim-free, insuring more than one vehicle, being a homeowner or being a good student. The provider also rewards loyalty and legacy, so policyholders can get a price cut if they have been a customer for over two years or if their parents had a policy with the company for five years.
If you are an active or retired member of the military, USAA is a great place to find the best rates and coverage for auto insurance. Available across the country, with some of the lowest rates for both minimum and full coverage, USAA is also always highly-rated for customer service. In addition to the usual coverage options, USAA offers some additional features like accident forgiveness and rideshare coverage.
Membership with USAA is annual, and you get a discount if all members of the family sign up. Additional discounts are available for bundling multiple policies, having more than one vehicle, taking a defensive driving course, having a new car, vehicle storage, length of membership and garaging your car on a military base.
In business since 1927, American Family is one of the lesser-known auto insurance companies, widely hailed for its superior customer service and affordable rates. Coverage options include basic and comprehensive coverage, rideshare insurance in select states, lease and loan gap insurance, uninsured and underinsured motorist damage, roadside assistance, accidental death and dismemberment coverage, OEM coverage, accident forgiveness and rental reimbursement.
American Family also has several discounts that may lower your rate, and features among the cheapest insurers for those with a DUI on their record.
How to find cheap car insurance
Saving money on car insurance is a big priority for many, but more often than not, the cheapest coverage is also the least amount of protection, and prices will be higher as you add extras to your policy.
Car insurance rates vary based on many factors, including the following:
- Credit history
- Driver age
- Driving record
- Vehicle value and type
Once these variables are taken into account, the “cheapest auto insurance” becomes highly subjective. It is important to identify your coverage needs and compare quotes from multiple companies to get the best rate. Other methods for reducing the cost of insurance include leveraging the following:
- Employer group insurance discount
- Buying a budget car with good safety features
- Increasing the deductible
- Bundling multiple policies
- Good credit history
Choosing the minimum insurance requirement
Each state-mandated minimum insurance requirement typically includes bodily injury and liability coverage, medical payments and property damage coverage. However, for the safety of the driver and the vehicle, full coverage is always recommended.
In addition to the basic features, a full coverage car insurance policy includes collision and comprehensive coverage, personal injury protection, uninsured or underinsured motorist coverage, roadside assistance and rental cost reimbursement.
Minimum liability requirements vary from one region to another. The Insurance Information Institute provides this chart to help you better understand your state’s requirements.
Other affordable car insurance programs
If traditional providers are not a good fit for your unique circumstances, consider these options as alternative versions of affordable insurance.
Cure is available in New Jersey and Pennsylvania and uses only your driving record to calculate your rate. According to its mission statement, the Cure program wants to level the playing field and make cheap auto insurance available to all. While this won’t help you if you live outside of New Jersey or Pennsylvania, it can save you up to 50% on auto insurance if you do live in either state.
Usage-based car insurance companies
Another option is to find a usage-based auto insurance company. Usage-based insurance programs calculate your insurance rate by only considering your driving record and habits and can lead to cheaper auto insurance, although it may be somewhat limited in terms of coverage. Most of the major insurers offer some form of usage-based auto insurance. A few of them are:
- Snapshot by Progressive
- Drivewise by Allstate in the states of Colorado, Arizona, New York, New Jersey, Illinois, Michigan and Ohio
- SmartRide by Nationwide
- DriveEasy by Geico in Pennsylvania and Connecticut
- Drive Safe and Save by State Farm Esurance offers a telematic plan called DriveSense
- RightTrack by Safeco
- IntelliDrive by Travelers
Is the cheapest car insurance the best?
Although price is an important factor, you only get what you pay for, and it could cost you in the long run. It isn’t uncommon to have cheap insurance with a high deductible, or coverage that comes with low limits. In all these cases, the policyholder will need to pay the excess amount out of their own pockets, as necessary. Therefore, instead of aiming for the lowest premium, it is recommended to look for the most affordable coverage options that provide the protection you need.
Frequently asked questions
How can I save on car insurance?
To save on your car insurance, get quotes from several insurers to compare. Take advantage of discounts like automatic payments, or vehicle safety equipment discounts. Or you can choose a higher deductible to lower your premium, provided you’re prepared in the event of a claim to pay more of the repair costs yourself.
Is the minimum required insurance in my state enough coverage?
The minimum coverage required by your state may be enough to make you street-legal, but would not be sufficient in case of a serious accident. Having the most coverage could leave you personally responsible for any expenses above the insurance limit. If you own your home or have investments or other assets, protect them by raising your auto insurance coverage limits.
Which cars are the cheapest to insure?
Although it could depend on the insurance provider and the location, Honda, Jeep and Subaru are three brands that are usually cheaper to insure compared to other car brands. Budget cars with high safety ratings and low index of claims in the recent past are the cheapest to insure.
Who has the cheapest car insurance?
Based on our analysis, Erie Insurance has the cheapest auto insurance at $372 per year, followed by Auto-Owners Insurance. Since these rates can vary from one person to another, shopping around and comparing quotes is the best way to find the most affordable car insurance for you.
Bankrate utilizes Quadrant Information Services to analyze 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 sample drivers own a 2018 Honda Accord, commute five days a week and drive 12,000 miles annually.
These are sample rates and should be used for comparative purposes only. Your quotes may be different.
Rates are determined based on 2020 Quadrant Information Services data.