The Cheapest Car Insurance Companies (December 2022)

The Cheapest Car Insurance Companies (December 2022)

State Farm has the cheapest car insurance rates among top companies, at $41 per month for minimum coverage. Geico and Erie also have affordable rates.

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Best cheap car insurance companies

The 10 cheapest car insurance companies

State Farm and Geico are the cheapest major car insurance companies in the country.

State Farm offers an average rate of $41 per month for a minimum liability policy, which is 29% cheaper than the national average. Geico also offers cheap car insurance quotes at around $52 per month.

Cheapest national car insurance companies

National companies
Monthly rate
State Farm logo
State Farm$41
Geico logo
Geico$52
American Family logo
American Family$53
Progressive logo
Progressive$63
Travelers logo
Travelers$63
Show All Rows

*Only current and former military members and their families are eligible for a USAA policy.

USAA has the most affordable rates at $31 per month, but only active military members, veterans or their families can qualify.

Cheapest regional car insurance companies

Auto-Owners and Erie have the cheapest car insurance quotes among local companies, with rates less than $40 per month. Farm Bureau is a close third place at $43 per month.

Local companies
Monthly cost
Auto-Owners $36
Erie $39
Farm Bureau $43
Mercury $44
Country Financial $45
Shelter $70

To help you get the most affordable car insurance near you, our insurance experts analyzed cost, coverage, availability and customer support for 37 top companies across the country. ValuePenguin's editorial team spent hundreds of hours ranking the best cheap companies by collecting millions of quotes across every ZIP code in the U.S.

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Find Cheap Auto Insurance Quotes in Your Area

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What's the cheapest car insurance company for you?

The cheapest company isn't the same for everyone because of factors like your location, age and driving record. You can get affordable car insurance and good customer support by comparing quotes from multiple companies.

Start with the cheapest companies in your state that balance affordable rates and coverage with strong customer service.

Cheapest car insurance company overall: State Farm

  • Editor rating

  • Full coverage

    $99/mo ?

Pros and cons

  • Cheapest quotes in 25 states
  • Dependable customer service
  • Fewer coverage options than other companies

State Farm is the best and cheapest car insurance company for most drivers.

State Farm is the largest auto insurance company in the country. It also has the best rates in 25 states if you're not eligible for USAA. The company has a large network of local agents, meaning there's likely a State Farm agent in your city who can help you compare the cheapest rates near you.

Cheapest for full coverage

Cheapest for minimum liability

Company
Monthly cost
State Farm$99
Geico$140
Progressive$156
Nationwide$164
USAA$91

Only current and former military members and their families are eligible for a USAA policy.

A full coverage policy includes both collision and comprehensive insurance, which helps cover the cost of damage to your car, regardless of whose fault it is.

Cheapest for full coverage

Company
Monthly cost
State Farm$99
Geico$140
Progressive$156
Nationwide$164
USAA$91

Only current and former military members and their families are eligible for a USAA policy.

A full coverage policy includes both collision and comprehensive insurance, which helps cover the cost of damage to your car, regardless of whose fault it is.

Cheapest for minimum liability

Company
Monthly cost
State Farm$41
Geico$52
Progressive$63
Nationwide$69
USAA$31

Only current and former military members and their families are eligible for a USAA policy.

A liability-only policy includes your state's minimum required coverage, which pays the medical and repair bills for the other driver if you cause an accident.

Drivers with State Farm can enroll in programs like Drive Safe & Save to turn good driving habits into affordable quotes. You can also qualify for a range of discounts, including an accident-free discount, a multi-car discount and an anti-theft discount.

Drivers can count on State Farm to provide a fast and easy claims process after an accident. The company earned a high score on J.D. Power's claims satisfaction survey. It also receives fewer complaints than competitors of a similar size, according to the National Association of Insurance Commissioners (NAIC).

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State Farm has all of the coverage options you would expect from a major insurance company, like liability insurance, personal injury protection and comprehensive and collision coverage. You can also get pet coverage, rideshare insurance and roadside assistance. However, it's lacking some popular coverage options like new car replacement and gap insurance.


Cheapest liability-only car insurance: Auto-Owners

  • Editor rating

  • Liability-only

    $36/mo ?

Pros and cons

  • Cheapest minimum coverage quotes
  • Excellent customer service
  • Only available in 26 states Can't compare quotes online

Drivers shopping for the absolute cheapest car insurance can find the best rates with Auto-Owners. A minimum coverage policy from Auto-Owners costs an average of $36 per month, which is 38% cheaper than average across the U.S.

Cheapest minimum coverage car insurance quotes

Company
Monthly cost
Auto-Owners$36
Erie$39
State Farm$41
Farm Bureau$43
Geico$52
American Family$53
National average$58

However, minimum-coverage car insurance isn't the best choice for most drivers. It doesn't include protection for damage to your own car. In addition, the liability limits included with minimum coverage usually aren't high enough to cover the cost of a major accident. That's why full coverage is better for most drivers, especially drivers with newer cars or a daily commute.

Auto-Owners also offers inexpensive full-coverage car insurance at $120 per month, on average.

Drivers are generally happy with the service they receive from Auto-Owners, too. The company receives about 33% fewer complaints than similar companies, according to the NAIC.

The biggest downside to Auto-Owners is that it's only available in 26 states. Drivers who can't buy car insurance from Auto-Owners should consider State Farm.


Cheapest car insurance rates after discounts: American Family

  • Editor rating

  • Liability-only

    $53/mo ?

Pros and cons

  • 18 discounts
  • Reliable customer service
  • Not available in all states

American Family (AmFam) has some of the cheapest car insurance in the country. A minimum coverage policy from AmFam costs around $53 per month for minimum coverage, while full coverage costs $140 per month.

American Family stands out when it comes to potential savings through discounts. Though AmFam's car insurance rates are slightly more expensive than State Farm or Geico, you may pay less overall if you qualify for its many car insurance discounts.

Cheapest companies with discounts

Company
Number of discounts
American Family18
Geico16
Liberty Mutual13
Travelers12
Allstate11
Show All Rows

You can easily earn discounts from American Family if you bundle insurance with multiple policies, drive a safe car or even shop for a new policy in advance.

  • Bundle home and auto insurance policies
  • Insure more than one car with AmFam
  • Get a quote seven days before your old policy expires
  • Switch to American Family from a competitor
  • Have certain safety equipment installed in your car, like airbags
  • Take a defensive driving course
  • Avoid accidents, tickets and claims
  • Drive fewer than 7,500 miles per year
  • Enroll in KnowYourDrive telematics, and practice safe driving habits
  • Pay your balance in full, or make automatic payments

AmFam also offers several discounts to help young drivers save on car insurance, like a good student discount, teen safe driver discount and young volunteer discount.


Cheapest auto insurance company for a bad driving record: Erie

  • Editor rating

  • Full coverage

    $112/mo ?

Pros and cons

  • Cheap rates for any driving record
  • Accident forgiveness
  • 12-month rate lock
  • 12 states and D.C.
  • Limited online support

Erie has some of the most affordable car insurance quotes for drivers with a ticket, accident or DUI on their driving records. For example, drivers with a single speeding ticket pay around $112 per month for full coverage from Erie. That's 39% cheaper than the national average.

Erie also increases auto insurance rates the least after a driving incident.

It will only raise your rates by an average of 11% if you get a ticket, while most companies increase quotes by 23% or more. For an at-fault accident, Erie will only raise your rates by 27% instead of the average 49%. And Erie's average quote with a DUI is $169 per month for full coverage, an increase of 67%. Other companies increase rates by an average of 83% after a DUI.

Cheapest car insurance companies after a driving incident

Company
Ticket
Accident
DUI
State Farm$110$125$277
Erie$112$128$169
Auto-Owners$130$154$243
Farm Bureau$148$177$252
American Family$168$214$229
Show All Rows

Monthly quotes for a full coverage policy

Erie customers who are eligible for its Rate Lock program can avoid rate increases that could cause insurance costs to creep up over the years. This is a unique program where customers won't see their rates increase except for three reasons: you change where you park your car, add or remove someone from your policy or add or remove a car.

That means your car insurance costs won't go up if you get a ticket or file a claim.

Erie also offers the same car insurance discounts as larger national companies, 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. Erie also has a reputation for excellent customer service.

The biggest downside to Erie is that it's only available in 12 states and Washington, D.C.


Cheapest car insurance for new drivers: Allstate

  • Editor rating

  • Liability-only

    $100/mo ?

Pros and cons

  • Cheapest individual policies for new drivers
  • Lots of discounts
  • Not the cheapest option for a family policy
  • Poor claims experience

Allstate has the cheapest rates for new drivers looking for an individual car insurance policy. A minimum coverage policy from Allstate costs $85 per month for a driver under 25 years old with no experience behind the wheel.

However, Allstate isn't the cheapest option for teen drivers looking to share a policy with their parents. Sharing a policy with family is usually the cheapest way for new drivers to get insurance.

Cheapest minimum-coverage car insurance for new drivers

Company
Under age 25
Over age 25
Allstate$100$33
State Farm$129$49
Geico$131$79
Nationwide$280$88
Farmers$375$142
USAA*$116$59

*USAA is only available to members of the military, veterans and their families.

In addition to cheap rates, Allstate offers lots of discounts for new drivers, including an automatic payments discount, paperless discount and smart student discount.

However, drivers aren't very happy with the service they receive from Allstate after an accident. The company scored below average on J.D. Power's claims satisfaction survey, which means it may take longer for Allstate to get you back on the road after a crash.


Cheapest car insurance for safe and low-mileage drivers: Nationwide

  • Editor rating

  • Liability-only

    $69/mo ?

Pros and cons

  • SmartMiles mileage-based savings if you drive under 12,000 miles/year
  • 22% average savings for safe drivers with SmartRide telematics
  • Usage-based insurance not available in all states
  • Expensive quotes for drivers who don't qualify for discounts

If you drive less than average or are generally a safe driver, Nationwide may have the cheapest insurance quotes for you. The company offers both a usage-based and pay-per-mile auto insurance plan to help drivers save on car insurance.

People that drive fewer than 12,000 miles per year can benefit from Nationwide's pay-per-mile program, SmartMiles. SmartMiles tracks the number of miles you drive per month using a device you plug in to your car. Nationwide charges you a set amount for every mile you drive, plus a monthly base rate. SmartMiles can save low-mileage drivers up to 30% on their car insurance rates.

Nationwide also offers a usage-based program, SmartRide. 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 are young, have poor credit, live in a congested city or have other risk factors that raise their insurance rates. Safe drivers can save up to 40% by enrolling in SmartRide.

That means Nationwide could be a cheap option 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 Nationwide is that these programs aren't available to everyone. The SmartMiles pay-per-mile program is available in 40 states and Washington, D.C. While SmartRide is more widely available, drivers in New York and California can't get the full 40% discount.


Cheapest car insurance for drivers with poor credit: Geico

  • Editor rating

  • Full coverage

    $212/mo ?

Pros and cons

  • Cheap rates with any credit score
  • Lots of discounts
  • Average customer service

Geico has the cheapest car insurance quotes for drivers with poor credit scores. At $212 per month, a full coverage policy from Geico is 16% cheaper than the national average for drivers with poor credit.

Cheapest car insurance companies with poor credit

Company
Poor credit
Good credit
Rate hike
Geico$212$14051%
Farm Bureau$217$13462%
Erie$232$101131%
American Family$233$14067%
Nationwide$236$16444%
Show All Rows

Monthly fully coverage rates for a driver with good credit vs. poor credit

Drivers with poor credit typically pay 70% more for car insurance compared to drivers with good credit. Improving your credit score is a great way to get cheaper auto insurance quotes.

Geico also offers lots of discounts to help lower your rates, including usage-based discounts, safe driver discounts and discounts for bundling home and auto insurance.


Cheapest car insurance quotes for military members: USAA

  • Editor rating

  • Liability-only

    $31/mo ?

Pros and cons

  • Cheapest quotes in most states
  • Top-rated customer support
  • Unique military perks like custom billing schedule
  • Only available to military, veterans and family
  • Long quote process

USAA is available in all 50 states and Washington, D.C. As the fifth-largest auto insurance company in the country, it serves almost as many drivers as other big names like Progressive and Allstate.

However, only military members, veterans and their families may be eligible for USAA.

Cheapest liability car insurance quotes

Company
Monthly cost
USAA$31
Auto-Owners$36
Erie$39
State Farm$41
Farm Bureau$43
National average$58

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 spot in J.D. Power's Auto Insurance Claims Satisfaction Study every year. That means drivers can expect USAA to help get things back to normal quickly after an accident. USAA also has a low complaint index from the NAIC, which means customers don't have many complaints about support or claims.


Cheapest car insurance by state

State Farm is the cheapest widely available insurance company in 25 states.

Drivers in seven states can find the cheapest rates with Geico. USAA is almost always the cheapest car insurance in every state, but its eligibility requirements mean most people won't qualify.

In some states, a small, local company or affiliate could offer you the least expensive car insurance. For example, Erie has the cheapest insurance in North Carolina, Ohio, Pennsylvania and Washington, D.C.

Compare rates in your state

Which drivers can get the cheapest car insurance quotes?

A variety of factors affect your car insurance quotes, including your location, age, driving history, vehicle, credit score and coverage.

Cheapest rates by age and coverage

Having more driving experience and no tickets or accidents helps make car insurance cheap. Drivers who opt for minimum coverage policies can get cheaper auto insurance quotes, though they risk not being fully covered after a major accident.


Taking the first step — knowing how much car insurance you need — is important for finding the right 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. This also makes comparison shopping easier, since different insurance companies might recommend different coverage levels by default.

How much auto insurance you need depends on your budget, where you live and what kinds of coverage you need.

Coverage
Required
How much to get
Bodily injury liabilityRequired in every state except FL, NH and VAAs much as you can afford, so you have enough to cover a major accident
Property damage liabilityRequired in every state except NH and VAAs much as you can afford, so you have enough to cover a major accident.
Uninsured and underinsured motorist coverageRequired in 22 statesMatch your bodily injury and property damage limits.
Personal injury protection (PIP) or medical paymentsRequired in 14 statesRecommended if you don't have health insurance or you have high deductibles or copays
Collision and comprehensiveRequired if you have a car loan or lease a carRecommended if your car is worth more than $5,000

How much coverage you need will depend on your finances. For example, high-net-worth individuals should get liability limits similar to their net worths, which will probably be more than the state-required minimums.

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How to get cheaper car insurance with discounts

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 insurance companies, one 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 so 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 insurance companies 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 company. 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.
icon of insurance policy

Chances are you could get a cheaper car insurance policy

Once you know how much coverage you need, the best way to find cheap car insurance is to compare quotes from multiple companies.

Compare Quotes Now

A driver looking for a minimum coverage policy overpays by an average of $384 per year. This means Americans are overpaying for car insurance by almost $41 billion per year.

You can get cheaper car insurance by comparing rates online. If you prefer to work with an actual person when looking for car insurance, you could talk to an independent insurance agent who can help you compare rates from multiple companies at the same time.

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Frequently asked questions

Who has the cheapest car insurance?

Among national car insurance companies, USAA has the cheapest rates, $31 per month, with State Farm in second place, at $41 per month. The cheapest local company is Auto-Owners, at $36 per month.

What's the cheapest online car insurance?

Geico, Progressive, USAA and State Farm are some of the cheapest companies that let you get quotes and buy a policy online. It's often cheaper to buy car insurance online than it is to work with an agent, since some agents charge you an extra fee, and you can often get discounts for buying online.

How can I save money on car insurance?

The best way to save on auto insurance is to compare quotes from multiple companies. Consider every factor that goes into your quote, such as your coverage amounts, deductibles and discounts. Don't just get quotes from big national companies — regional companies like Erie, Farm Bureau and Auto-Owners could have some of the cheapest rates if you live in a state they serve.

What's the cheapest type of car insurance?

State-minimum liability coverage is the cheapest type of car insurance. Liability-only insurance is $90 per month cheaper on average than a full coverage policy. Switching to a liability-only policy could help you save if your car isn't worth much and you don't have a car loan or lease.

Is it a good idea to get the cheapest car insurance?

It depends on what you're giving up in exchange for the cheapest rate. If you raised your deductible or lowered your coverage, for example, consider how much extra you'd have to pay out of pocket after an expensive accident. Or, if you choose a company known for a slow claims process, consider how long you could afford to be without a car or pay for a rental car while you wait for the repair check in the mail.

What credit score do I need to get the cheapest car insurance?

Typically you can get the cheapest auto insurance rates if you have good to excellent credit, which means having a credit score of at least 700. But not every state allows car insurance companies to base your quotes on your credit-based insurance score.

When does car insurance get cheaper for young drivers?

Car insurance for young drivers costs up to three times more on average. Teen drivers can expect car insurance rates to go down with each year of driving experience, with significant drops when they turn 21 and 25.

Methodology: How we got our info

We collected quotes for thousands of ZIP codes in the U.S. from 36 insurance companies. Rates are for a single 30-year-old man with good credit who drives a 2015 Honda Civic EX and has a clean driving record. Your quotes may vary.

Minimum coverage quotes are based on the minimum required coverage in each state. Full coverage quotes are based on a policy with higher liability limits, along with comprehensive and collision coverage:

Coverage
Limit
Bodily injury liability$50,000 per person/ $100,000 per accident
Property damage liability$25,000 per accident
Uninsured/ underinsured motorist BI$50,000 per person/ $100,000 per accident
Personal injury protectionMinimum when required by state

Rates for new drivers are based on a driver living in Texas with no driving experience and a good credit score. Quotes include $30,000 of bodily injury liability per person and $60,000 per accident, along with $25,000 of property damage liability per accident, which are the minimum legal requirements in Texas.

ValuePenguin's analysis used insurance rate data from Quadrant Information Services. These rates were publicly sourced from insurer filings and should be used for comparative purposes only — your own quotes may be different.

ValuePenguin calculated the average amount drivers overpay for car insurance by calculating the difference between the average cost of a minimum coverage policy across all sample insurers in each state and the average cost of the cheapest sampled insurers in that state

These figures were then averaged across all 50 states and Washington, D.C., to find a national average. This average was multiplied by the Federal Highway Administration's latest figure for the number of registered automobiles in the country to find the aggregate amount drivers overpay for insurance.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.