Cheapest Car Insurance Companies: Cost and Coverage (2022)

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When looking for the cheapest car insurance, you might start with USAA, Erie Insurance, Root Insurance, Geico, and State Farm. Based on our in-depth research, these companies all offer competitive prices. Below, we look at average rates and coverage options to help you find the best auto insurance provider for your needs.

If you’re ever wondering how to get cheap car insurance, we recommend seeking 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, and driving history can affect your premium.

In this article:

  • Cheapest Car Insurance Company
  • Cheapest Auto Insurance Companies
  • #1 USAA: Cheapest Car Insurance For Military Families
  • #2 Erie Insurance: Cheapest Car Insurance For Bundling Discounts
  • #3 Root Insurance: Best Usage-Based Insurance
  • #4 Geico: Cheapest Car Insurance For Good Drivers
  • #5 State Farm: Cheapest Car Insurance For Students
  • How To Get Cheap Car Insurance
  • Average Car Insurance Rates By State
  • What Affects Car Insurance Rates?
  • How To Keep Your Car Insurance Rates Low
  • Cheapest Auto Insurance: Conclusion
  • FAQ: Cheap Car Insurance
  • Methodology

Cheapest Car Insurance Company

According to our rate estimates, USAA tends to be the cheapest provider overall with full coverage rates as low as $1,013 per year on average. This estimate applies to 35-year-old good drivers with good credit scores. We also found USAA to be the cheapest option in 29 states in our nationwide cost review.

Cheapest Auto Insurance Companies

In our study of the cheapest auto insurance companies, we found several companies with relatively low rates. While some other car insurance companies provide cheap auto insurance, we are going to focus in this article on the five mentioned above. These providers have the best rates for minimum car insurance coverage as well as the cheapest full coverage insurance.

#1 USAA: Cheapest Car Insurance For Military Families

Whether you’re searching for liability insurance or a full coverage policy, USAA provides some of the cheapest average rates. According to our rate estimates, USAA costs about $1,013 per year for the average 35-year-old driver.

USAA provides perks such as roadside assistance, accident forgiveness, rental car coverage, and car replacement assistance (CRA). Plus, the USAA mobile app makes filing a claim simple. USAA also offers other types of insurance, including life insurance, homeowners/renters insurance, and health insurance.

The company is known for its superior customer satisfaction. USAA earned the highest score among large insurers in the J.D. Power 2021 U.S. Insurance Shopping StudySM and outscored every provider in every region in the J.D. Power 2021 U.S. Auto Insurance StudySM.

However, not everyone will qualify for coverage with USAA because it covers only military members, veterans, and their families.

USAA auto insurance might be right for you if:

  • You are part of the military, a veteran, or a military family member
  • You want the cheapest car insurance available

To learn more about this affordable car insurance provider, check out our USAA auto insurance review.

#2 Erie Insurance: Cheapest Car Insurance For Bundling Discounts

Erie Insurance provides cheap car insurance quotes online and is known for its customer service. The average 35-year-old driver pays about $1,113 per year, according to our rate estimates. The downside with Erie Insurance is that coverage isn’t available in every state. You can only get an auto insurance policy if you live in these locations:

Erie Auto Insurance Reviews

Looking at the BBB ratings for Erie Insurance, you’ll find this provider has an A+ rating. Furthermore, the J.D. Power Auto Insurance Study suggests Erie is a leader wherever coverage is sold.

Erie Insurance might be right for you if:

  • You live in a covered state
  • You have had an at-fault accident
  • Your credit score is excellent

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

#3 Root Insurance: Best Usage-Based Insurance

Root Insurance is a little different from other insurance providers. Instead of basing your auto insurance premium mainly on your driving record, it weighs your driving behavior first. To get a quote from Root Insurance, your driving behavior first has to be recorded through the Root mobile app, which can take a couple of weeks.

Since Root provides coverage only to good drivers, it pays out less often, making it one of the cheapest car insurance providers. However, Root can deny coverage if you aren’t a good driver.

Root Insurance provides all the standard types of coverage. On top of that, every plan comes with roadside assistance.

Root might be for you if:

  • You are a good driver
  • You prefer doing everything through a mobile app

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

#4 Geico: Cheapest Car Insurance For Good Drivers

Geico isn’t just well known because of its commercials – it’s also one of the cheapest auto insurance providers. According to our rate estimates, Geico costs about $1,352 per year for the average 35-year-old.

While Geico might not be the best choice for someone with a spotty driving record, safe drivers find a lot of benefits in using the provider. Perks offered by Geico include roadside assistance, ridesharing insurance, and mechanical breakdown coverage.

Geico Insurance Reviews

In addition, the company has an A+ rating from the BBB, plus it scored highly in the J.D. Power Auto Insurance Study. When you use the organization’s website, you will find the quote process is simple and you can track claims with ease.

You can find various plans covering property damage liability and bodily injury liability coverage, as well as comprehensive plans. No matter what type of coverage you opt for, you are likely to get one of the lowest rates through Geico.

Geico might be for you if:

  • You want to customize coverage
  • You don’t have infractions on your driving record

To get to know this cheap auto insurance provider better, check out our Geico auto insurance review.

#5 State Farm: Cheapest Car Insurance For Students

State Farm is another one of the cheapest car insurance company options and is especially well-suited for students and teen drivers. According to our rate estimates, the average 35-year-old pays about $1,339 for State Farm annually. However, State Farm is not rated by the BBB at this time.

State Farm Discounts

State Farm offers Drive Safe & Save Discounts to help you keep more money in your pocket. By participating in the program, you can save up to 30 percent. The program is simple to use and can be performed from OnStar or your smartphone.

In addition, State Farm is a provider that shows up on both the J.D. Power Insurance Shopping Study and the Auto Insurance Study, although some regions rank it slightly lower than others.

State Farm might be a good fit for you if:

  • You want to participate in the safe driving program
  • You have poor credit
  • You are an inexperienced driver
  • Your driving record shows an accident

For more on this cheap car insurance provider, read our State Farm auto insurance review.

How To Get Cheap Car Insurance

Our team surveyed 1,000 car insurance customers on their experiences. When choosing car insurance, the cost was the most important factor for 28 percent of the participants, while 25 percent said having coverage options (comprehensive, uninsured motorist, etc.) was the most important factor. Because drivers are required to purchase car insurance in most states, it makes sense that many people want to find the cheapest rates.

So how and how often do most people shop? According to our survey, 30 percent prefer to use a quote comparison tool online, and 24 percent get quotes online from individual companies. Many people also use independent brokers or call agents over the phone. Of course, since most companies offer multi-policy discounts, a number of respondents said someone else does the shopping.

Unfortunately, cheap car insurance may not stay cheap forever. On average, 41 percent of respondents said they’ve experienced a rate increase without an obvious cause like a ticket or accident.

Car Insurance Rates By State

Average car insurance rates vary greatly from state to state. In fact, the cheapest car insurance company in one state might not be the cheapest in another. Below, you will find average full coverage car insurance estimates by state, the cheapest provider in each state, and that same provider’s average cost in the state. Also included below is Washington, D.C. These rate estimates apply to 35-year-old drivers with good driving records and credit.

According to our research, USAA is the cheapest option in 29 states. Other cheap car insurance companies include Geico, State Farm, and Progressive, plus regional providers such as the Texas Farm Bureau.

What Affects Car Insurance Rates?

The Insurance Information Institute (III) details all the factors that go into determining your rates. While a few of these seem obvious, a couple might surprise you.

  • Driving record: If you drive well and have a clean driving record, you will generally find lower car insurance rates. If you have had serious traffic violations or accidents, received a DUI, or are considered a high-risk driver, you will pay more.
  • Use of vehicle: The more you drive, the greater your risk. If you do a lot of commuting or traveling, insurance companies will give you a higher rate. If you don’t spend a lot of time driving, you can sign up for what’s known as a “pleasure” rate.
  • Age: Once you hit 25 years old, you will notice your car insurance premiums begin to decrease. That’s because you aren’t considered as much of a risk as a young driver. As you become a senior, the rates will once again start to rise.
  • Location: Urban drivers can expect to pay higher car insurance rates because of the increase in vandalism, accidents, and theft.
  • Vehicle type: Some cars are known to be expensive to insure, while others are rated as the cheapest. Insurance companies consider the cost of your vehicle as well as the likelihood of theft, price of repairs, and overall safety record.
  • Credit history: Credit scores are usually taken into account as a way to examine your reliability. A poor credit history indicates a higher likelihood of filing a claim.
  • Gender: Statistics from the Insurance Institute for Highway Safety (IIHS) show that women get into fewer car accidents than men. As a result, women pay less for car insurance on average.
  • Auto insurance coverage: The limits, deductible, and policy options you choose affect the price you pay for coverage.

How To Keep Your Car Insurance Rates Low

You can keep your car insurance rates low by choosing your car wisely, increasing your deductibles, maintaining a high credit score, finding the best discounts, and reducing insurance limits. You can also shop around to compare rates from providers.

If you have speeding tickets or accidents on your driving profile or have poor credit, you might pay a higher insurance premium. Still, there are ways to save money on your insurance costs.

  • Consider what car you buy: Before you buy a car, get a quote on insurance. You might be surprised at what models raise your rates.
  • Reduce comprehensive car insurance: If you have an older car, consider removing collision coverage or comprehensive coverage. Just make sure you have the money to replace the vehicle if something happens. Not every state requires you to carry personal injury protection, either. Play with the plans to see what works for your financial situation.
  • Increase deductibles: If you have some money in your savings, you can increase the deductible to lower the premium.
  • Maintain a good credit score: This is an automatic way to get bigger savings.
  • Look for low-income car insurance: Some states have government-sponsored programs that help low-income families afford car insurance. While not everyone qualifies, it might be something to look into if you are struggling to make ends meet.

Car Insurance Discounts

One of the easiest ways to save money is to look for discounts on car insurance policies. Some providers offer better discounts for students and others offer better discounts for owning a home. Here’s a partial list of some car insurance discounts you may find:

  • Good student discount
  • Safe driver discount
  • Multi-policy discount
  • Multi-vehicle discount
  • Defensive driving course discount
  • Military deployment discount
  • Veteran discount
  • Discounts for various safety features
  • New vehicle discount

How To Shop For Car Insurance

The key to finding cheap auto insurance is knowing how to shop. Because of the many factors that are unique to you, what might be considered low-cost car insurance for you may not be the same for someone else. Here are a few tips that might help:

  • Shop: Don’t necessarily go with the first company you find. Instead, shop around. Each company has different car insurance discounts and rates.
  • Don’t assume one company is the best: Just because you see a lot of commercials for a car insurance company doesn’t make it the cheapest car insurance provider. Do your research to determine who deserves your business.
  • Check local insurers: While many of the big companies can provide low insurance costs, you don’t want to look past local companies. Call a local broker to see what’s offered in your area.

Cheap Monthly Car Insurance

If you don’t drive a lot, you might consider pay-per-mile or usage-based insurance. There are many options, such as Allstate’s Drivewise and State Farm’s Drive Safe & Save. These let the insurer track how many miles you drive and how well you do on the road in exchange for a discount.

With a little work and some patience, you will find the auto insurers with the best car insurance rates for your situation.

Cheapest Auto Insurance: Conclusion

In this review, we found that USAA is the cheapest auto insurance company.

While we all want to save money, it’s important to remember the cost of auto insurance isn’t the only factor to consider. After all, if you decide to go with just state minimum coverage and you cause an accident, you might be liable for the additional damages out of pocket. This expense is something to consider when you’re trying to save a dollar on coverage long-term. Sometimes, paying more is better.

When choosing an auto insurance provider, you can’t strictly assess your options based on affordable auto insurance prices. You might get the lowest rate but have a company that drags its feet when it comes time to pay. In the meantime, you are left without a vehicle and in worse shape than if you had paid more for your auto insurance.

When you do your online comparison shopping among insurance providers, always consider:

  • Price
  • Customer satisfaction scores
  • Reliability ratings
  • Financial reputation
  • Ease of filing an auto insurance claim

All these factors together will help you to find the provider that fits your needs, and you can save money in the process.

Find some frequently asked questions about cheap car insurance below:

Methodology

In an effort to provide accurate and unbiased information to consumers, our expert review team collects data from dozens of auto insurance providers to formulate rankings of the best car insurance companies. Companies receive a score in each of the following categories, as well as an overall weighted score out of 5.0 stars.

  • Industry Standing: Insurers with strong financial ratings and customer-first business practices receive the highest scores in this category.
  • Availability: We consider availability by state as well as exclusions for specific groups of drivers.
  • Coverage: This rating is based on types of insurance available, maximum coverage limits, and add-on policies.
  • Cost and Discounts: Our research team reviews auto insurance rate estimates generated by Quadrant Information Services for a variety of drivers in every state. Companies with lower prices and many car insurance discount opportunities receive the best scores.
  • Customer Service: We comb through customer reviews and consumer feedback studies from experts such as J.D. Power.
  • Technology: Auto insurers with mobile apps, advanced online services, and telematics are more likely to meet consumer needs.

Read our other insurance articles:

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  • Utah Car Insurance Quotes
  • Car Insurance Quotes In Minnesota
  • Massachusetts Car Insurance Quotes
  • Michigan Car Insurance Quotes

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