Drivers in Texas pay higher car insurance rates than the average American. The average annual cost of car insurance in Texas is $1,823 for a full coverage policy and $524 for a minimum coverage policy. For comparison, the average car insurance premium in the United States is $1,674 per year for full coverage and $565 per year for minimum coverage.
Data shows that 15.5% of Texans live below the poverty line, which is higher than the national average rate of 13.1%. If you own a registered vehicle in Texas, you are legally required to carry insurance, even if your family is considered low income. However, there are several ways to get low income car insurance in Texas.
Low income car insurance in Texas
Low income car insurance is not a specific type of car insurance. Rather, low income insurance policies are often available through state-sponsored programs for people who cannot afford standard coverage. Low income car insurance makes it easier for individuals to obtain the state’s required coverage and reduces the number of uninsured drivers on the road.
Unfortunately, Texas does not offer any government-run low income car insurance programs. The only states that currently offer these programs are California, Hawaii and New Jersey. However, there are multiple ways that low-income families in Texas could purchase a policy that is more affordable than average.
Shopping around for car insurance and getting quotes from multiple providers could help you find the cheapest policy available for the type and amount of coverage you need. You can also improve your credit score and raise your deductible to help achieve a lower rate. Additionally, looking for insurance companies that offer multiple discounts you can take advantage of is a great way to reduce average premiums.
Texas requirements for minimum car insurance
In Texas, drivers are required to carry at least 30/60/25 personal liability insurance, which is considered to be a minimum coverage policy. Minimum coverage in Texas includes the following:
- $30,000 in bodily injury liability coverage per person
- $60,000 in bodily injury liability coverage per accident
- $25,000 in property damage liability coverage per accident
A minimum coverage insurance policy may be appealing to low income drivers in Texas looking for a cheap policy. However, a minimum coverage policy may not offer enough coverage for most drivers in the case of an accident involving another vehicle or passenger. If you cause an accident and the damages are greater than the policy’s limit, you are responsible for paying the difference out-of-pocket. Additionally, a liability-only policy does not offer any coverage for your own vehicle, which is where other coverages such as collision come in handy.
Every car insurance company in Texas charges a different rate for coverage. The table below includes the average minimum coverage premiums from popular providers in Texas.
Average Texas car insurance rates by company
|Car insurance company||Average annual premium for minimum coverage|
|State Auto Insurance||$628|
Based on the table above, Geico has the cheapest car insurance premium in Texas at $391 per year for minimum coverage. Although Geico’s coverage is somewhat limited, the company offers a long list of discounts with savings for military personnel, federal employees, good students and many others.
USAA is comparable in terms of price, but it only sells insurance to active duty and retired military service members. Allstate, Nationwide and State Farm have more expensive minimum coverage premiums, but they also offer generous discounts.
Car insurance discounts for low income drivers
To get insurance for low-income families in Texas, look into providers that offer a variety of discounts you can qualify for. Even if you receive a quote that is out of your budget, you may be able to lower your premium significantly using discounts. Here are some of the most common insurance savings:
Most car insurance companies offer policy bundling discounts, which typically could help you save at least 10% on your insurance premium. You can claim a policy bundling discount by purchasing two or more policies from the same provider, typically a home and auto insurance policy. You can also get a discount for insuring more than one vehicle on your policy.
If you practice safe driving habits, you can usually qualify for a discount on your insurance premium. Look for companies that offer a discount for being claims-free or completing an approved defensive driving course. Many popular insurance carriers also offer an app-based safe driver rewards program, which tracks your driving skills using telematics. With these programs, drivers generally save more money on their premium over time as they continue safe driving habits.
Vehicle safety features
The last major category of car insurance discounts is related to vehicle safety features. If your car has advanced safety features, like an anti-theft system, airbags, anti-lock brakes or lane departure alerts, you can likely qualify for a lower insurance premium. Most insurance providers list the qualifying safety features on their website.
Although the number of discounts available to drivers will vary from company to company, most providers offer at least a few different ones that can be taken advantage of to reduce your premium further. When researching a car insurance company, you can often check its auto policy page or discounts page for all available savings opportunities.
Frequently asked questions
What company offers the cheapest car insurance?
The cheapest car insurance company varies because every driver pays a different rate for car insurance. Insurance companies look at factors like your age, credit score, claims history, the type of car you drive and how often you drive to calculate your personalized premium.
Where can I find low income car insurance?
There are only a handful of states that offer low income car insurance. California, Hawaii and New Jersey offer state-sponsored plans, but you must meet certain eligibility criteria in order to get coverage. If your state does not have a low income program, you could get a cheaper insurance rate through discounts, raising your deductible and paying your premium in full. Keep in mind that you take on more financial risk in the case of an accident or claim when raising your deductible.
Can you get car insurance with bad credit?
Yes, you can get car insurance with bad credit. However, you will likely pay a much higher premium than average. Working to improve your credit score is often beneficial in helping you get a lower rate.
What is the difference between full coverage and minimum coverage?
The difference between a full coverage and minimum coverage policy is the type of coverage included. A minimum coverage policy only includes liability insurance, which protects your legal and financial responsibility in the event of an accident. A full coverage policy includes liability insurance plus additional coverages, such as collision and comprehensive insurance to cover potential damage to your vehicle. Full coverage policies may also include medical payments and uninsured/underinsured motorist coverage.