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By Javier Cruz
Updated: June 10, 2020 10:41 AM ET | Originally published: May 19, 2020
Money; Getty Images

You want to protect yourself and your car on the highway. But you don’t want to spend a fortune on car insurance. How can you lower your auto insurance rates without cutting corners?

Buying insurance at your state’s minimum level could save money on premiums. But this level of coverage won’t always help enough after a wreck.

If your auto policy couldn’t cover your losses from an accident, you’d become personally responsible for paying the damages. Buying only minimum coverage could cost you a lot more in the long run.

We’ve researched auto coverage amounts and insurance companies to help you find the cheapest car insurance that does not compromise your protection.

Best Cheap Car Insurance Companies

Shopping around can help you find the most affordable auto insurance. We recommend getting at least three auto insurance quotes before signing up for coverage.

As you compare cheap car insurance quotes, make sure you’re comparing policies with the same amount of coverage. It won’t help to compare a full-coverage quote from one company with a minimum coverage quote from another company.

We recommend considering auto insurance policies from these 11 companies as you compare car insurance quotes:

  1. Geico: Cheapest Rates
  2. Progressive: Best for Families
  3. Liberty Mutual: Best Discount Variety
  4. State Farm: Best Rates from Local Agents
  5. The General: Best for Accident History
  6. Root: Best for Safe Drivers
  7. Travelers: Best for Hybrid-Electric Vehicles
  8. USAA: Best for Military Families
  9. Allstate: Best for Fast Claims Service
  10. Farmers: Best for High Mileage Drivers
  11. Quote Wizard: Comparison Marketplace

Geico: Cheapest Rates

GEICO has the lowest annual rates for non-military drivers, averaging $2,145 for good drivers and $5,665 for teens. This makes GEICO an affordable car insurance option, but the company also offers 15 discounts, more than almost any other provider.

To make your life easier, Geico’s website classifies each of the company’s discounts by type, and the company lists the average savings each discount could provide. This helps you know how much you’d save before even applying.

GEICO now also has a pay-as-you-drive option through its DriveEasy app. GEICO’s program is brand new so we don’t have much data on it yet. This isn’t necessarily bad, but a longer history will help us determine how much the app could save on premiums.

Most telematics programs can help the safest drivers claim good driving discounts.

Compare Rates with Geico

Progressive: Best for Families

Progressive offers Snapshot, its telematics program, and Progressive’s policies could even help if your pet gets injured in a wreck.

But we like Progressive best for its focus on discounts for families with students — both high school and college students — who tend to drive up premiums.

Progressive has four different car insurance discounts for high school and college students: multi-car, good student, teen driver, and distant college student.

These discounts are simple to claim: the good student discount requires only a B average throughout the school year. The distant college student discount helps drivers age 22 or younger who travel more than 100 miles to get to campus.

Progressive has 10 other discounts for adults, and it has small and large accident forgiveness rewards programs. You’d get small accident forgiveness the moment you sign up, and this program prevents your rates from increasing because of a claim that’s $500 or smaller.

Large accident forgiveness rewards can prevent rate increases regardless of cost or who was at fault. It’s hard to join this program. You’d need to be a Progressive policyholder for at least five years — and have three years accident-free — before you’re eligible to join.

Compare Rates with Progressive

Liberty Mutual: Best for Discount Variety

Looking to qualify for as many discounts as possible? Then Liberty Mutual is the right insurance company for you. With 17 discounts to choose from, and with simple requisites for most discount programs, you should be able to find several ways to save money.

Liberty Mutual also offers more specific discounts than other insurers, including military and alternative-energy discounts for hybrid cars.

This century-old insurer has also launched use-based insurance through its pay-as-you-drive (ByMile) and pay-how-you-drive (RightTrack) insurance options.

  • ByMile could help you save if you drive infrequently. Part of your premium will depend on your actual mileage.
  • RightTrack measures how well you drive, and you could save up to 30 percent if Liberty Mutual’s telematics device shows you’re a safe driver. RightTrack is not available nationwide. Only 42 states have this option.

State Farm: Best Rates for Local Agents

State Farm has about 19,000 local agents across the country. Shoppers who want to have a one-on-one discussion about ways to save tend to like State Farm.

State Farm also has the most comprehensive rental car and travel expense coverage on the market. The coverage provides a rental car while your vehicle is in the shop, and it could repay up to $500 of the deductible if you have an accident in the rental.

And, if you get in a wreck while on a trip, State Farm can help with meals, lodging, and transportation — up to $500 — while your car’s being repaired. For this travel expense coverage to apply, your car’s damage must be covered by your comprehensive or collision insurance.

State Farm’s discount list is shorter than other leading insurers’, but you could still save by opting into this insurer’s telematics programs:

  • Drive Safe & Save program: For customers 25 and older.
  • Steer Clear Driver program: For drivers below age 25.

Both of these programs can provide up to 30 percent off the total costs of premiums.

Compare Rates with State Farm

The General: Best for Accident History

The General aims to help higher-risk drivers save money. If you’re looking for low rates despite having a history of collisions or moving violations in the past three years, give The General a chance.

This insurer has fewer discount programs than the other car insurance companies on this list. But many auto coverage discounts don’t apply when you have recent accidents on your driving record anyway.

However, you could save by paying your policy’s premiums upfront instead of splitting up the cost over monthly installments. You’ll also save if you’re a homeowner and if you have multiple cars on your auto policy.

If you’re a high-risk driver you can save with a policy from The General, but your rates will still increase if you have an additional accident or moving violation. Safe driving remains the most reliable way to save money, long term, on auto coverage.

The General provides basic coverage with a few extras such as a deductible waiver option when you’re replacing safety equipment like windshields and fog lights. You could also opt into 24/7 roadside assistance.

Root: Best for Safe Drivers

Safe driving pays off with Root. This telematics-based insurance company breaks all discount averages on the market.

Typically, subscribing to an insurer’s pay-as-you-drive (PAYD) or pay-how-you-drive (PHYD) plan saves you about 20 percent on premiums. With Root you could get up to 52 percent off your premiums. Of course you’d need to exhibit safe driving to keep rates low.

It all happens through Root’s app which also lets you to change your coverage levels any time. Root even offers roadside assistance for free. Insurance companies usually add on this feature for an extra monthly fee. Roadside assistance applies only to three accidents every six months.

Root serves 37 states, leaving Florida, Kansas, Wyoming, Idaho, Minnesota, Wisconsin, Michigan, New York, Vermont, New Hampshire, Maine, South Dakota, and New Jersey on the sidelines.

Root wants to insure safe drivers so it denies coverage for drivers who don’t make the cut. To see if you qualify for Root, install its app on your phone and drive for three weeks.

If you get a quote, Root considers you a safe driver and will help you save money. If you don’t get a quote Root doesn’t want to insure you — and you can’t take the test again!

And, Root doesn’t cover TNC drivers when they’re on duty, so it’s definitely not an option for Uber or Lyft drivers.

Travelers: Best for Hybrid-Electric Vehicles

At 10 percent, Travelers has the highest discount for electric or hybrid vehicles, making it the best insurance company for these cars. You’d need to work directly with a Travelers agent to enroll. Then you can simply request a hybrid-electric discount.

Travelers also has 11 other car insurance discounts, including driver training, early quote, multi-car, and new car discounts. If you prefer use-based insurance, Travelers offers Intellidrive, its telematics program.

How does it work? After using the Intellidrive device or smartphone app for 90 days, the system will assess your driving. Safe drivers could get up to 20 percent off their premiums.

Across the board, Travelers is a highly rated insurance company with solid customer service.

USAA: Best for Military Families

USAA saves military families money on car insurance premiums. USAA is an association, much like a credit union, but only active duty and retired military members — and their families — can join.

Along with its already-low rates, USAA members can save through a variety of discounts. USAA tailors some of its discounts to military life. For example, these policies charge less when the policyholder is deployed.

Members can tap multi-car, good grade, and safe driving discounts. USAA has an accident forgiveness program, too.

USAA is part of the family in many military households. Though it started as an auto insurer, the association now offers banking, investing, and all the main types of insurance.

Allstate: Best for Fast Claims Service

You probably won’t get the cheapest premiums from Allstate, a household name for auto and home insurance. But you would get solid protection and fast service when you need to file a claim.

Like State Farm, Allstate has a nationwide network of agents. Your local agent should be your point of contact with your insurance policy.

The company has a wide range of common car insurance discounts and free car insurance quotes online — so you could chip away at your premiums and save month to month that way. But if you have a lower credit score and a driving record with a few blemishes, you’ll pay more with Allstate.

Esurance, a subsidiary of Allstate, provides all-online policies.

Farmers: Best for High Mileage Drivers

Like Allstate, Farmers Insurance won’t win a contest for the cheapest car insurance premiums. But the company’s quality auto insurance coverage could make life easier and save you money after a wreck.

Farmers prides itself on making its claims process smooth and hassle-free. But this is a post about the cheapest car insurance options, so how does Farmers fit in?

If you’re an experienced driver who puts a lot of miles on your car — and you have a clean driving record and a good credit score — Farmers could offer low auto insurance premiums while still extending solid coverage and customer service.

QuoteWizard: Best Marketplace

QuoteWizard isn’t an insurance company, but it can connect you with potential savings on your car insurance premiums.

QuoteWizard has 29 insurance partners, and unlike most aggregators, its application process does not require your Social Security number or your driver’s license number. So you can compare quotes without giving personal details.

And, QuoteWizard lets you compare its insurers head to head, explaining their pros and cons, complaint data for each, financial ratings, and even their discount availability.

Just choose the companies you want to compare, and QuoteWizard will break down all of this information, allowing you to make a more informed decision.

Since QuoteWizard is an aggregator, it doesn’t provide quotes directly — its partners provide the quotes through QuoteWizard. So by using this service you consent to be contacted by these companies. If this bugs you, don’t use this service.

A Regional Car Insurance Company Could Save You Money

The 11 companies on our list above serve motorists across the country. But car insurance is a local product. States have different requirements and regulations.

Some companies sell policies in only one state or in a region. As you shop for the cheapest car insurance coverage, be sure to consider the smaller companies in your area:

  • Erie Insurance: This award-winning coverage is available in 12 states: Illinois, Indiana, Kentucky, Maryland, North Carolina, New York, Ohio, Pennsylvania, Tennessee, West Virginia, and Wisconsin.
  • Wawanesa: This Canadian auto insurer also writes quality policies for California and Oregon residents.
  • SECURA: Independent agents in 12 states — Arizona, Colorado, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, North Dakota, and Wisconsin — can connect you with this coverage.
  • Shelter: Drivers in Arkansas, Colorado, Iowa, Illinois, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Nebraska, Missouri, Nevada, Ohio, Oklahoma, and Tennessee could save with this company.
  • Island Insurance: This insurer competes with the cheapest car insurance companies but only in Hawaii.
  • AAA Clubs: The American Automobile Association (AAA) has regional chapters across the United States. Some chapters partner with local insurers to offer discounts. Large chapters such as Auto Club of Southern California offer coverage directly.
  • Farm Bureaus: Though it’s a national name, Farm Bureau operates as a collection of small, regional insurers.
  • Westfield: Based on Ohio, Westfield Insurance writes auto policies in Illinois, Indiana, Iowa, Kentucky, Michigan, Minnesota, Ohio, Pennsylvania, Tennessee, and West Virginia.

Most of these smaller companies will not have a wide variety of policy discounts you’d expect from a national company so their average rates won’t look competitive at first.

But a smaller company usually depends more on face-to-face customer service. You may be able to save money by getting coverage customized to your exact situation.

Six Elements of a Car Insurance Policy

Low rates and discounts are key ingredients, but to save money on car insurance it helps to understand how auto coverage works. A car insurance policy includes six basic types of coverage:

  • Liability Coverage: If you cause a wreck, this part of your auto policy pays to repair the damage you caused — both property damage and bodily injury to someone else. Your state’s minimum may not be enough to protect you from losing assets if you get sued. Get enough property damage liability coverage and bodily injury liability to protect your assets.
  • Comprehensive Coverage: This protects your auto investment from theft or damage from hail, animals, or vandalism.
  • Collision Coverage: This coverage kicks in to protect your own car in an accident. If someone else causes the accident, that motorist’s liability coverage should pay, assuming you live in a state that assigns responsibility for car wrecks, as most states do.
  • Uninsured Motorist/Underinsured Motorist Coverage: If the driver who causes a wreck has no liability coverage or does not have enough liability, this part of your policy could help cover your losses.
  • Personal Injury Protection (PIP): This element of your coverage could pay medical expenses for you and your passengers regardless of who was at fault. PIP is required by law in some states, so check to see if yours is one of them. Some policies also have separate coverage specifically for medical expenses.

Of these six coverages, the most important are liability, comprehensive, and collision. These cover most of the situations you could get in as a motorist and auto owner.

You could also make a case for personal injury protection since medical care is so expensive.

How to Find Cheap Auto Insurance

You could save money by eliminating comprehensive coverage, but your own auto investment would be less protected. If you still owe money on your car loan, your lienholder may require you to keep comprehensive coverage.

You could save by limiting your liability insurance to your state’s minimum requirement. But you’d be more exposed to financial losses after a wreck.

So aside from discounts, how do you lower your car insurance premiums?

You can save the most by keeping a good driving record. It’s true — the best car insurance rates go to people who pose a lower risk of an accident.

Accidents cost insurance companies money. Someone with a clean driving record is statistically less likely to have a wreck and can get lower premiums.

Your coverage options will also make a difference. Getting discounts helps, too. Bundling policies with the same insurance provider can save you money. If you already have a renters policy, for example, you could save by adding auto insurance with the same company.

But safe driving is still the best way to save consistently, month after month. If you’ve had some moving violations or at-fault wrecks in the past couple of years you’ll pay higher premiums. There’s nothing you can do to get these problems off your driving record except wait.

In most states, after three to four years, the effects of the negative marks on your driving record will go away.

In the meantime, you can do other things to save on car insurance premiums whether or not you have a pristine record at the DMV.

How To Find The Cheapest Car Insurance

Yes, driving history matters a lot. Discounts do too. But you can still find other ways to save. You can’t control every aspect of your insurability, but by controlling the factors you can control, you should be able to lower your insurance premiums.

Along with your driving record, these factors affect the cost of your coverage:

  • Credit Score: Insurance costs depend some on your credit score but not because of your bill-paying history. Insurers have found a connection between lower credit scores and higher instances of claims. Not all states allow this underwriting consideration, but most do. Poor credit could add hundreds of dollars a year to your premiums.
  • Age: The youngest and the oldest drivers cost more to insure because statistics show they have more wrecks. Younger drivers can often take a defensive driving course to lower premiums. They can also earn lower rates as time passes. But a younger driver who has an at-fault accident on his or her driving record will face expensive premium rates.
  • Gender: Males have more wrecks and, as a result, tend to pay higher insurance costs.
  • Telematics: More and more insurers collect actual data about your driving habits and use them to measure your risk of having a wreck. Devices can be installed in your car to track your speed and braking habits. Other car insurance companies use apps on your phone to monitor you.
  • Car Make & Model: Sports cars cost more to insure because they have more wrecks and cost more to replace. Larger vehicles cost more because they cause more damage in a wreck. Common vehicles such as a Honda Accord or a Ford F-150 are easier to repair so your comprehensive coverage could be a little lower.
  • Car Age: The age of your car factors into comprehensive and collision coverage. Since newer cars would cost more to replace, policies for newer cars tend to cost more.
  • Car Safety Features: Antilock brakes, airbags, back-up cameras, anti-theft devices — anything that can prevent an accident could help lower your premiums and help you get more affordable coverage.
  • Geography: Car insurance quotes differ from county to county and sometimes from neighborhood to neighborhood. Insurers factor in your risk theft, the number of cars on the highways near you, and even the weather patterns to assess the risk of paying a claim on your vehicle.
  • Frequency of Driving: Driving more could increase your rates because you’re more likely to be involved in a wreck. That’s why insurers will ask how far you drive to work and how often you go on long road trips. Some auto insurance companies offer infrequent driver discounts. Occasional drivers should also consider pay-by-the-mile coverage which we’ll talk about below.

Controlling What You Can Control Saves Money on Car Insurance

As you can see, you cannot control every aspect of your premiums, so it’s important to control what you can if you want to find cheaper car insurance.

Can you improve your credit score? Probably so, if you’re patient and make a point of paying bills on time. Can you control your age? Of course not.

You also can’t easily control where you live or how often you need to drive. But you could control details about your car and, of course, your driving history going forward. Of course, neither of these factors will create instant savings unless you’re already in the market for a different car anyway.

So most car owners can find the best results by researching two things:

  1. The number of discounts each company offers, as noted in our reviews above.
  2. Whether or not a company has use-based insurance options available.

Use-Based Car Insurance Coverage

Use-based insurance either tracks how you drive, tracks mileage, or both. Either strategy could save you money.

Just signing up for a telematics-based plan could save you 20 percent on your premiums. This is an insurance company’s way of motivating you to opt in. They want real data about your driving habits.

But you’re putting your privacy in the company’s hands since it gets to track your car’s whereabouts and/or your driving habits as long as you’re subscribed to this type of insurance.

How do companies gather this information? By using a telematics device — sometimes called a black box— that you plug into your car’s diagnostic port under the hood. Other companies rely on apps you install on your phone.

There are two types of use-based insurance:

  1. Pay-How-You-Drive (PHYD) Insurance: This uses your driving habits and patterns to generate part of your premium. Data can include vehicle speed, fuel levels, tire pressure, braking patterns, and trip distances, among others.
  2. Pay-As-You-Drive (PAYD) Insurance: This option considers only the miles you drive per day and charges part of your premium accordingly. The other part of your premium is not affected by your mileage. It’s based on the other underwriting factors we’ve already discussed.

How to Find High Quality & Cheap Car Insurance Rates

For the companies on our list above, we focused on two factors: discount availability, where you can apply to as many as you qualify for, and telematics-based programs that either offer cheaper insurance alternatives (PAYD), or provide additional discounts to your premiums (PHYD).

We also looked at companies that offered more than just discounts, such as extra coverage or added benefits at little to no extra cost. Examples of this are rideshare insurance, accident forgiveness, roadside assistance, and free apps for added benefits.

Discounts

To offer as much discount potential as possible, we looked for car insurance companies with a minimum of 11 available discounts. On average, each discount can save you between 1 and 3 percent off your premiums, but there are some discounts out there that can help you save as much as 30 percent.

Discounts vary from state to state. With some companies they vary widely. Contact each company you’re interested in to verify you’ll get the discounts you want.

Company websites don’t always list every discount. Check with your insurance agent or your online insurer’s customer service department about non-advertised discounts you could qualify for.

Phone reps tend to know a lot about discounts.

Use-Based Insurance

This popular trend among car insurance companies — which we’ve already discussed in this post — can help drivers in high-risk categories prove they drive safely enough to get lower premiums. Students or senior citizens, for example, who tend to get charged higher rates can benefit a lot by signing up for telematics and then driving safely.

Remember, though, that your driving data normally represents just part of your premium which dilutes your ability to save.

If you choose a pay-how-you-drive plan be sure you obey the speed limit, avoid hard stops, keep your tires inflated properly, and avoid running too low on gas. All these data points could end up costing you more.

With pay-by-the-mile insurance, you should avoid unnecessary trips or combine errands when possible. Most of these plans stop charging you once you reach 100 or 150 miles in one day. This prevents long trips from running up your insurance bill.

The telematics devices — whether installed on your car or on your smartphone — need a few weeks to calibrate themselves to your car.

Extra Coverage and Benefits

Companies often use discounts to draw in new customers. If you’re not happy with the discounts you have in effect, ask whether your company can do more to help you save. Often it can.

You may even have add-on coverage you don’t remember adding, such as ridesharing coverage, roadside assistance, or rental car insurance. If you aren’t using and don’t anticipate needing these services, canceling them could save you money each month.

Watch Out for Price Optimization

Price optimization has been banned in 20 US states. Its primary purpose is to profit from customers who rarely switch between insurance companies.

Through price optimization, companies gather all your personal data that isn’t necessarily connected to your driving habits. This could include your web browsing history, shopping behavior, social network interactions, and even your online mail subscriptions.

With this data, they create an algorithm to determine how likely you are to drop them and subscribe to another insurance company.

This sounds invasive because it is. But here’s the kicker: if the insurer concludes you’re unlikely to leave them for another company, they’ll take advantage of your loyalty and begin increasing your premiums by small amounts on a monthly or yearly basis. If you see your rates go up without a reason, contact your car insurance company immediately.

Summary of our Cheap Car Insurance Companies

  1. GEICO: Cheapest Rates
  2. Progressive: Best for Families
  3. Liberty Mutual: Best Discount Variety
  4. State Farm: Best Rates from Local Agents
  5. The General: Best for Accident History
  6. Root: Best for Safe Drivers
  7. Travelers: Best for Hybrid-Electric Vehicles
  8. USAA: Best for Military Families
  9. Allstate: Best for Fast Clamins Service
  10. Farmers: Best for High MIleage Drivers
  11. Quote Wizard: Comparison Marketplace

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