Best car insurance in Texas for 2023

Our 2023 Bankrate Score considers variables our insurance editorial team determined impacts policyholders’ experiences with an insurance company. These rating factors include a robust assessment of each company’s product availability, financial strength ratings, online capabilities and customer and claims support accessibility. Each factor was added to a category, and these categories were weighted in a tiered approach to analyze how companies perform in key customer-impacting categories.

Like our previous Bankrate Scores, each category was assigned a metric to determine performance, and the weighted sum adds up to a company’s total Bankrate Score — out of 5 points. This year, our 2023 scoring model provides a more comprehensive view, indicating when companies excel across several key areas and better highlighting where they fall short.

• Tier 1 (Cost & ratings): To determine how well auto and home insurance companies satisfy these priorities, 2023 quoted premiums from Quadrant Information Services (if available), as well as any of the latest third-party agency ratings from J.D. Power, AM Best and the NAIC, were analyzed.
• Tier 2 (Coverage & savings): We assessed companies’ coverage options and availability to help policyholders find a provider that balances cost with coverage. Additionally, we evaluated each company’s discount options listed on its website.
• Tier 3 (Support): To encompass the many ways an auto insurance company can support policyholders, we analyzed avenues of customer accessibility along with community support. This analysis incorporated additional financial strength ratings from S&P and Moody’s and factored a company’s corporate sustainability efforts.

The Texas Department of Insurance mandates all drivers to carry specific amounts of liability coverage.  Texas auto insurers must also offer uninsured motorist coverage, underinsured motorist coverage and personal injury protection (PIP), although these options can be declined in writing. Bear in mind that the state-required minimum coverages might not provide adequate financial protection if you cause a car accident. To better protect your assets, you may want to buy higher levels of liability coverage or full coverage car insurance.

Texas law may not be the only thing that influences how much insurance you need to carry. On top of state requirements, drivers who have leased or financed their vehicles may be required by their financial lenders to carry more insurance. Typically, this entails adding comprehensive and collision coverage to your policy. Because a lender has a vested financial interest in your vehicle, it is common for them to want to ensure that you are protecting their investment. With comprehensive and collision coverage, you are financially protecting your vehicle from a larger number of losses.

While looking at financial strength ratings, customer satisfaction scores, average rates and discount offerings are all excellent moves to make throughout your insurance shopping journey, it’s helpful to start by evaluating your own needs. After all, the best car insurance company will depend on what you need from an insurer. If you have a DUI on your record, you may need to look for an insurer that will file an SR-22 on your behalf. Or, if you have multiple speeding tickets on your record, looking into a high-risk insurer may be a smarter move. If you have a newer car, you may want to search for a company that offers features like new car replacement and gap coverage, if you have a loan or lease.

The cheapest car insurance company in Texas will vary from driver to driver. Why? Because each insurance company in Texas uses its own unique underwriting algorithm to determine your premium, and not all companies weigh the same things equally. A speeding ticket, for instance, can raise your Geico full coverage premium from $1,494 to $1,657 per year. With Dairyland, on the other hand, full coverage premiums skyrocket from $2,802 per year to $3,339.

If you are looking for the lowest rate in Texas auto insurance for your situation, the best approach is likely to select several companies that interest you and request quotes for the same types and levels of coverage to compare.

Driving without insurance in Texas is punishable by fines or possibly a license suspension. If it’s your first offense, the fines could total $350, while fines for subsequent offenses could reach $1,000 and a license suspension. To avoid this situation, Texas drivers are required to carry the minimum amount of car insurance coverage set by the state.

Like almost everything else, the average national cost of car insurance from 2022 to 2023 increased 14 percent, from $1,771 to $2,014 for a full coverage policy. Bankrate identified a few main reasons as to why: inflation, premium give-backs, an uptick in claims and labor shortages have all contributed to more expensive car insurance premiums. When you factor in that car insurance rates are highly individualized, how much your rates went up may vary (and, for a small number of people, rates could have even gone down; if, for instance, a hefty moving violation just dropped off their record).

Texas is considered an at-fault state. This means that the driver who is found to be at fault in the accident is responsible for covering the costs of the other party’s damages, whether property, medical or both. Uniquely for an-fault state, though, personal injury protection coverage (PIP), must also be offered in Texas but can be declined. PIP is typically found in no-fault states as it is a coverage that pays for injuries and lost wages resulting from an accident for each driver and their passengers, regardless of who caused the accident.

Typical of most states, Texas law requires drivers to carry at least a minimum amount of liability insurance that covers both injuries and property if you cause an accident. Uninsured and underinsured motorist coverage must be offered but can be declined.

Regardless of whether you decline the additional coverage types that insurers must offer in Texas, you may also want to consider purchasing higher liability limits than required to better protect yourself financially if you cause an accident.