Here’s how to get quality car insurance without hurting your budget.

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Whether you’re a new driver or on the hunt for a new company, you’re probably asking: Who has the cheapest car insurance? Finding cheap car insurance is a balancing act between getting what you need and staying within your budget. Though a lower price does not always mean less coverage, it’s important to understand the whole picture, so you know how to save the most money in the long run, not just on your premium.

That said, we know that the premiums are often the deal breakers for many customers. So, who has the best and cheapest car insurance? Our team analyzed more than 30 of the best car insurance companies today, taking cost, discounts, customer reviews, coverage, and industry reputation into account.

Enter your zip code or call (855) 518-0148 to start comparing free car insurance quotes:

 

In This Article:

Who Has The Cheapest Car Insurance?

USAA offers the cheapest auto insurance policy, with strong industry ratings and comprehensive coverage, according to our cost analysis. However, USAA auto insurance coverage is only available to military personnel and their immediate family members.

If USAA is not right for you, see a full breakdown of our top five cheapest auto insurance providers below:

Cheapest Car Insurance

Rating

Best For

Discounts

Cost Rating

State Availability

Notes

1. USAA Insurance

5.0

Military

10+

4.5

50

For military members and their families

2. Erie Insurance

4.0

Multi-car homes

8+

4.5

12

Rate-lock program available

3. Root Insurance

4.0

Infrequent drivers

Usage-based 

4.5

29

Final rate determined after six months based on driving habits

4. Geico Insurance

4.5

Good drivers

16+

4.0

50

Affordable rates and usage-based driving discounts

5. State Farm Insurance

4.5

Students

11+

4.0

48

Plenty of discounts, especially for students
 

While many small car insurance companies could be worth your while, a company with experience, a transparent website, and strong customer reviews is always your best bet in the long run.

When it comes down to who has the cheapest car insurance, we factored in the following points:

  • Cost
  • Number of discounts
  • Nationwide availability
  • Coverage plan details

We also noted the group that benefits most from discounts in some cases.

 


 

USAA Insurance logo

#1 USAA: Cheapest Car Insurance For Military

USAA has always been reserved for military members and their immediate family members. The company receives some of the highest ratings and customer satisfaction reviews, and it has a range of great discounts, including:

  • Military installation: Receive a 15 percent discount when you park your car at a military base.
  • Usage-Based: This discount calculates your car insurance rates based on the number of miles driven in a year for drivers over 19-years-old.
  • Good driver: This premier discount program is available for drivers who have been accident-free for the past five years.
  • Defensive driving or education: Customers can take pre-approved driving courses that cut premium costs.
  • Good student: Full-time students who maintain a grade point average (GPA) of 3.0 or higher are eligible for discounted car insurance rates from USAA.
  • New vehicle: If your car is less than three-years-old, it could qualify for the New Vehicle warranty.
  • Auto payments: Enroll in automatic payments to get up to thee percent off of your insurance bill.
  • Family: The more family members you add onto a USAA policy, you could qualify for the family discount.

The ample list of discounts above is a sure sign that premiums greatly vary. Here is an example of the monthly cost of USAA for the following driver profile:

  • 25-year-old single woman
  • Drives a 2016 Honda Fit with 50,000 miles
  • Lives in Raleigh, NC and hasn't moved recently
  • No accidents or traffic violations

6-Month Premium

$424.70

Monthly Payment for 6-Month Policy

$70.78

To learn more about this cheap car insurance provider, check out our review of USAA car insurance.

 


 

Erie Insurance logo

#2 Erie: Cheapest Car Insurance For Multi-Car Homes

Erie Insurance provides cheap car insurance quotes online and is also known for having a positive customer service track record. The downside with Erie Insurance is that the coverage isn’t available in every state. You can only get a policy if you live in these regions:

District of Columbia

Illinois Indiana Kentucky Maryland

North Carolina

Ohio Pennsylvania Tennessee Virginia West Virginia Wisconsin

Erie Insurance offers a variety of insurance discounts to help you save more on your policy.

  • Safe driver discounts: Discount available for safe drivers with good driving records.
  • Care safety equipment discount: Receive this discount if your car is equipped with safety features like factory-installed airbags and anti-theft devices.
  • Multi-car discount: Insure two or more cars on the same policy to qualify for this discount.
  • Multi-policy discount: When you bundle life or home insurance with your auto insurance policy, get a discount on both.
  • Reduced usage discount:  Receive discounted rates if you don’t use your car for at least 90 consecutive days (not available in Kentucky).
  • Young drivers: Drivers that are under the age of 21 and unmarried (not available in North Carolina) get a discount.
  • Annual payment plan: If you pay for your policy annually instead of monthly you qualify for this discount.

To learn more about this cheap car insurance provider, check out our review of Erie car insurance.

 


 

Root Insurance logo

#3 Root Insurance: Cheapest Usage-Based Car Insurance

Though you will miss out on things like gap insurance or the option to bundle with other plans, Root Insurance is one of the top providers who has the cheapest auto insurance because it offers usage-based car insurance plans. This means that your car insurance rates are calculated based on how much you drive.

Root auto insurance could be right for:

  • Drivers with a clean record
  • People who drive a low annual number of miles (less than 12,000 miles per year)

Root auto insurance is not right for you if you have a history of DUI's, reckless driving, accidents, or speeding tickets on your driving record. This is because Root Insurance can deny drivers coverage based on a negative driving record.

So how does Root Auto work? The Root Auto app calculates the cost of your car insurance premium based on your driving in the first six months. After the initial six months, your premium may go up. On the company website, Root claims that customers can save up to 52 percent compared to top companies.

Because your premium is based on your individual driving and offers overall cheap car insurance rates, the company doesn't offer any discounts.

To learn more about this cheap car insurance provider, check out our review of Root car insurance.

 


 

Geico Insurance logo

#4 Geico: Cheapest Car Insurance For Good Drivers

Good drivers could save money for a long history of safe driving by signing up for auto insurance from Geico.

Though many companies on our list offer good driving car insurance discounts, Geico is one of the highest rated companies with some of the most cost-effective plans.

Each company defines “good driver” by a range of factors. Here are the related Geico discounts:

    • Accident-free: Receive up to 26 percent off of the cost of your car insurance from Geico for driving for 5 years accident-free.
    • Seat belt use: Get your car insurance rates discounted up to 15 percent off medical payments coverage or bodily injury liability insurance.
    • Defensive driving course: You are eligible for this discount when you complete state requirements for defensive driving courses.
    • Driver’s education course: This discount is available for teens and students who complete a pre-approved driver's education course.
    • Usage-Based Safe Driving Discount: Download Geico's DriveEasy® app that will monitor your safe driving habits and qualify you for discounted car insurance rates. Unlike Root Insurance, the DriveEasy app data will never work against you to raise your premiums.

Finally, we used the same profile as we did for USAA to determine how much Geico costs each year. Here is an example of the monthly cost of Geico for the following driver profile:

  • 25-year-old single woman
  • Drives a 2016 Honda Fit with 50,000 miles
  • Lives in Raleigh, NC and hasn't moved recently
  • No accidents or traffic violations

6-Month Premium

$294.39

6-Month Premium with Multi-Policy Discount

$280.37

While the perks are useful, Geico's positive industry reputation is another reason why this cheap auto insurance provider made our list. Here is a breakdown of a few of Geico's ratings and accolades:

  • AM Best Financial Strength Rating: A++
  • Better Business Burea Rating: A+
  • Consumer Reports Reader Score: 78/100

To learn more about this cheap car insurance provider with impressive ratings, check out our review of Geico.

 


 

State Farm Insurance logo

#5 State Farm: Cheapest Car Insurance For Students

State Farm looks out for young drivers just taking to the road. Since teen drivers traditionally pay more for car insurance, many companies including State Farm offer unique programs as they grow. State Farm has two programs to track good driving habits:

  • Drive Safe & Save™: Drive safely by accelerating and braking smoothly to qualify for up to 30 percent off.
  • Steer Clear®: Designed for students under 25 years old with 3 years of accident-free driving, the app is a driver training system with mentoring options and certification at the end of the program.

State Farm costs an average of $1,260.12 per year, according to U.S. News & World Report. That breaks down to $105.01 per month.

To learn more about this cheap car insurance provider, check out our review of State Farm car insurance.

 



Whenever you shop for car insurance, we recommend getting quotes from multiple providers so you can compare coverage and rates. In addition to the insurance company you choose, factors such as your age, vehicle make and model, and driving history can affect your premium, so what’s best for your neighbor might not be best for you.

Use our tool below or call (855) 518-0148 to start comparing personalized car insurance quotes:

 

 


 

What Affects The Cost Of Car Insurance?

The Insurance Information Institute outlines the top factors that determine a car insurance quote:

  • Your driving record: This includes traffic violations or accidents.
  • Car usage: Some companies measure your miles driven during a certain period of time.
  • Location: State laws and where you park your car can affect rates.
  • Age: In some cases, young and senior drivers are considered high-risk customers.
  • Gender: Men occasionally see higher rates than women.
  • Type of car: Factors like age, mileage, and safety features can affect rates.
  • Your credit: Your credit-based insurance score calculates your probability of filing a claim.
  • Insurance type: Companies offer a wide range of coverage and add-ons with different limits.

You can get a good sense of what you’ll pay by checking out your state car insurance averages before shopping around. These fluctuate due to state insurance laws, the details of each zip code, and the average cost of cars that people drive in your area.

 


 

How To Get The Cheapest Car Insurance

Owning a car can be costly, but there are ways to make it work within your budget. Since car insurance is required in most states, finding who has the cheapest car insurance may be at the top of your list no matter a company’s ratings. Here are some ways to get good coverage from a reputable company:

1. Consider minimum coverage vs full coverage:

Each state sets a minimum amount of coverage that typically includes bodily injury and property damage liability and sometimes includes personal injury protection or uninsured motorist coverage. If you’re a confident driver and want to keep your premiums low, you can always choose to stick with the basic state-mandated coverage. This is not our recommendation, but it is possible.

Once you are able to add more coverage, you can expand to a company’s perks like roadside assistance and even accident forgiveness.

2. Consider Your Limits And Deductibles

When setting up your plan with an auto insurance agent, be sure to ask for clarification about each plan’s limits and deductibles.

Limits are the maximum amount the car insurance company will pay for each type of accident or damage to your car. For example, some companies will only pay up to the vehicle’s current value.

A deductible is an amount you must pay before coverage kicks in, much like health insurance. If you have a deductible for comprehensive insurance and a tree branch damages your car, you may have to pay the first $500 of repairs – or whatever your deductible is – before your insurance company contributes.

3. Know Your Discount Options

Before you assume that car insurance discounts are only for small communities, check out your insurer’s site for its offers. You’d be amazed at how many discounts you can get for simple factors like seatbelt use or staying with the same provider for several years.

Here are some top discounts to keep an eye out for:

Coverage Type

Description

Good Student

Discount for higher GPAs

Good Driver

Rewards for a clean driving record or mobile device that tracks good driving habits

Seniors

Discounts for members over a certain age or members of senior organizations

Multiple Policies

Lower rates when you bundle a car insurance plan with other insurance or more than one car

Defensive Driving

Lower costs when you take a state-approved or military-run defensive driving course

Military and Federal Employee

Discounts for government employees and veterans

Usage

Discounts for rarely using your car for great distances or for storing your car certain months

New or Safe Vehicle

Discounted rates for a new car or car with anti-theft or safety features

 

4. Try Usage-Based Car Insurance

If you’re someone who tends to stay local or use your car only on occasion, usage-based car insurance may be for you. Some companies offer a tracker or mobile application that determines your premium based on how many miles you drive a year. This is also a great alternative to temporary car insurance if you only plan to use a car for several months.

5. Shop Around At Renewal Time

Most car insurance plans work on a six-month or annual contract. At the end of each renewal period, shop around for new rates, especially if your driving record has changed over the past term. For example, if points on your license expired in the past several months, you could qualify for lower rates from your current or new company.

It costs you nothing to submit your information for a free car insurance quote, so consider poking around for your best car insurance bet whenever you transition between companies. Use the tool below or call (855) 518-0148 to get started.