What is the cheapest car insurance company?
State Farm and USAA are the most affordable major insurance companies in the country. State Farm offers an average rate of $532 per year for a minimum-liability policy, 26% below the national average. USAA costs an average of $432 per year, although only active military members, veterans or their families can qualify.
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Among insurers that have a smaller national footprint, Farm Bureau Insurance, at $472 per year, and Auto-Owners, at $484 per year, rank as the cheapest. Erie’s in a close third place at $503 per year.
Smaller insurance companies sometimes offer lower rates because they compete with much bigger companies. Some also deliver more local knowledge or a personal touch because they’re based in your state or community.
How can I find the best price on car insurance?
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What is the cheapest car insurance company for you?
To find the cheapest car insurance for you, start by getting quotes from the auto insurance companies with the cheapest rates. Depending on a variety of factors — location, driving history, credit score and more — some insurers may be cheaper for certain drivers than others. If you’re looking for the cheapest companies that also offer the best balance of affordability, strong customer service and coverage options, compare the best auto insurance companies.
Cheapest car insurance company overall: State Farm
State Farm is the largest auto insurance company in the country, with the cheapest widely available rates in 29 states. Additionally, the company boasts an enormous network of local agents, meaning there’s likely a State Farm agent in your city who can help you compare rates.
State Farm is the best and cheapest car insurance company for most drivers, considering that USAA has eligibility restrictions, and Farm Bureau and Auto-Owners are disproportionately expensive when you add more coverage.
Cheapest for full coverage
Cheapest for minimum liability
A full-coverage policy includes both collision and comprehensive insurance, protecting you against damage to your car, not just the legal liability of hurting or injuring other drivers.
State Farm also scores high marks for policy options. It offers pet coverage, rideshare insurance and roadside assistance. Customers also have plenty of options to bundle and even further lower their rates.
Drivers with State Farm can enroll in programs such as Drive Safe & Save to turn good driving habits into lower rates. They can also qualify for a range of discounts, including an accident-free discount, multicar discount and anti-theft discount.
Cheapest car insurance rates after discounts: Geico
Geico has some of the cheapest car insurance in the country, second only to State Farm among the biggest companies.
Geico may have cheaper rates for you than State Farm depending on where you live, as the cheapest company in seven states, including California and Florida.
Geico stands out when it comes to potential savings through discounts. Though State Farm has slightly cheaper rates on average, you may pay less overall if you qualify for Geico’s many car insurance discounts.
Geico has one of the longest lists of discounts available, and how much you can save with each discount is more than most companies.
For example, Geico offers safe drivers a discount of up to 22%, compared to the average of 10%. Having anti-theft devices installed in your car typically saves you up to 15%, but Geico promises savings up to 23%.
|Company||Number of car insurance discounts|
Cheapest auto insurance company for a bad driving record: Erie
Erie has some of the cheapest car insurance rates for drivers with a ticket or accident on their driving record. And you probably won’t find a better rate if you have a DUI (driving under the influence) on your driving record. Erie also increases rates the least after a driving incident.
Erie will only raise your rates by an average of 7% if you get a ticket, while most insurers increase premiums by 22% or more. For an at-fault accident, Erie will only raise your rates by 25% instead of the average 44%. And Erie’s average quote with a DUI is $2,257 per year, an increase of 64%. Expect other companies to double your rates after a DUI.
Cheapest car insurance companies after a driving incident
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Rates are for a 12-month full-coverage policy, which includes comprehensive and collision insurance, plus state-mandated liability insurance.
Erie also has a strong customer service reputation and a good set of insurance options.
Erie customers who are eligible for its Rate Lock program can avoid premium hikes that could cause rates to creep up over the years. This is a unique program where customers won’t see their rates increase except for three reasons: you move to a different area or change where you park your car, add or remove someone from your policy, or add or remove a car.
That means your rates won’t go up even if you happen to get a ticket or file a claim.
Erie also offers the same car insurance discounts that larger national insurers provide, including bundling multiple insurance policies, having a vehicle equipped with anti-lock brakes or anti-theft equipment or driving safely as a young or senior driver.
The biggest downside to Erie is that it’s only available in 12 states plus DC:
- District of Columbia
- New York
- North Carolina
- West Virginia
Cheapest car insurance for safe and low-mileage drivers: Metromile
If you drive less than average or are generally a safe driver, a usage-based or pay-per-mile auto insurance company such as Metromile may be the cheapest insurance for you.
Metromile was one of the first companies in the U.S. to determine premiums largely based on mileage. How much driving is too much when shopping with Metromile? Generally, for Metromile to be a good deal, drivers should drive fewer than 10,000 miles per year.
Usage-based insurance is often cheaper than standard car insurance because your rates are largely based on how often and how well you drive. It’s a good option for people who are generally safe drivers but can’t find cheap rates elsewhere because they’re young, have poor credit, live in a congested city or have other risk factors that raise their insurance rates.
That means Metromile is a cheap company for people who are retired or work from home, students who live on campus and young drivers with a clean driving record.
The biggest downside to Metromile is that it’s only available in eight states: Arizona, California, Illinois, New Jersey, Oregon, Pennsylvania, Virginia and Washington. If you don’t live in one of those states, consider other telematics programs that offer discounts for less driving or safer driving, like Nationwide, Liberty Mutual or State Farm.
Cheapest car insurance for drivers with poor credit: Farm Bureau
Overall, Farm Bureau is the cheapest auto insurance company for drivers with poor credit, averaging $1,278 per year.
Farm Bureau’s average rate is $32 per year cheaper than the next closest widely available competitor, Geico. The company’s rates are 12% cheaper than average.
|Company||Poor credit||Very good credit||Rate hike|
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Rates are for our designated sample driver shopping for a full-coverage policy.
Farm Bureau operates like AAA: nearly every state has a local chapter that offers car insurance policies and other benefits to members. Anyone can become a member, not just farmers, but you’ll need to pay an annual membership fee, which can range from $20 to $100 per year. Membership benefits also include discounts on car purchases, farm equipment, produce, healthcare, travel, rental cars and more.
Drivers with poor credit typically receive insurance quotes that are 99% higher on average compared to drivers with excellent credit. Improving your credit score is a great way to get big savings on your insurance policy.
Cheapest car insurance company for military members: USAA
USAA is the cheapest company on average by quite a wide margin for drivers who qualify, beating State Farm’s rates by $100 per year on average.
|Insurer||Average annual rate|
|Average of all insurers||$717|
USAA operates in all 50 states and Washington, D.C., but only active military members, veterans and their families may be eligible. However, as the fifth-largest auto insurance company in the country, it serves almost as many drivers as other big names like Progressive and Allstate.
USAA stands out for more than just affordable rates: It also has one of the best customer service reputations in the industry. The company takes the top spots in J.D. Power’s Auto Insurance Claims Satisfaction Study every year. USAA also has a low complaint index from the National Association of Insurance Commissioners (NAIC), which means customers don’t have many complaints about their service or claims.
The cheapest insurers by state
Select your stateAlabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District Of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming
The price of car insurance varies greatly between states. One company may be expensive in Utah but inexpensive in New York. USAA is almost always the cheapest company in every state, but its eligibility requirements make it restrictive. State Farm was the cheapest widely available and accessible insurer.
In some states, a small, local company or affiliate could offer you the least expensive car insurance. For example, the cheapest insurers on average in Arkansas, Georgia, Kentucky, Louisiana and Nebraska are their Farm Bureau affiliates.
Which company has the best car insurance?
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What are the 3 major car insurances?
A variety of factors affect your car insurance rates, including your location, age, driving history, vehicle, credit score and, perhaps most importantly, coverage.
Young drivers and those with an accident history typically have much cheaper quotes than older drivers and those who have a clean driving record. Drivers who opt for a minimum-coverage policy can get the cheapest auto insurance rates, though they risk not being fully covered in a major car accident.
Which car insurance plan is best?
Broadly speaking, you should take two key steps to find the cheapest car insurance for you.
- Ensure you’re shopping for the appropriate level of car insurance coverage.
- Shop for quotes between multiple insurers, including our top recommendations. When shopping, take advantage of all available discounts.
Taking the first step — knowing how much car insurance you need — is important for finding appropriately cheap car insurance. You don’t want to overpay for unnecessary coverage, but you do want to purchase enough coverage to fulfill legal requirements and to appropriately cover your risk. You’ll also have to define your appropriate coverage limits to make fair price comparisons across insurers.
Determining how much auto insurance you need comes down to understanding your budget, your state’s car insurance requirements and how the different types of coverage work together.
|Coverage||Required||How much to get|
|Bodily injury liability||Required in every state except FL, NH and VA||Per accident limits close to your net worth|
|Property damage liability||Required in every state except NH and VA||Per accident limits close to your net worth|
|Uninsured and underinsured motorist coverage||Required in 22 states||Per accident limits close to your net worth if you don’t have PIP and collision|
|Collision and comprehensive||Required if you have a car loan or lease a car||Recommended if your car is worth more than $3,000|
|Personal injury protection (PIP) or medical payments||Required in 14 states||Recommended if you don’t have health insurance or you have high deductibles or copays|
How much coverage you need will depend on your finances. For example, high-net-worth individuals should get liability limits similar to their net worth, which will probably exceed the state-required minimums.
Who normally has the cheapest car insurance?
Now that you’ve determined how much car insurance you need, shop around between insurers and apply all discounts possible.
Once you know how much coverage to buy, it’s time to compare car insurance companies. Even when you opt for the exact same coverage levels with two different insurers, one company could be much cheaper for you than another based on how it calculates its rates.
It’s easier than ever to compare cheap insurance quotes using online quote tools. But you may want to talk to an insurance agent to ensure you get the most accurate quote possible.
By talking to an agent, you can see if you qualify for discounts that may not be applied in the online quote tool process. Car insurance discounts are generally broken into four categories:
- Driver safety discount: Cheaper rates for having a safe driver history or taking defensive driving courses.
- Driver discount: Discounts lifestyle elements that insurers reward with cheaper rates. These can range from incentives — such as a student getting savings for getting good grades — to elements you can’t control, such as a senior discount for those of a certain age.
- Policy discount: Savings offered for buying more products or coverage from a particular insurer. The most common discount of this type is a home and auto bundle, in which you get big savings from buying home and auto insurance with the same company.
- Safe car discount: If your car has safety features, such as anti-theft technology or automatic braking, you may qualify for a discount.
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