Most states mandate that you carry a minimum amount of auto insurance coverage. Unfortunately, they don't offer any guidelines on how much you should spend for that coverage, and rates can vary tremendously among insurance providers, with everything from your car's age to your credit history impacting the premiums you pay. While you don't want to skimp, you don't want to spend a fortune either. Is there such a thing as cheap car insurance that provides adequate protection?
Yes, there is. And, luckily for you, we did our homework on the cheapest car insurance options out there. In compiling the data, we considered all the major components that influence car insurance rates, including driving records, credit scores, discounts, daily driving habits, and more. Based on our findings, we selected the following as the six best cheap car insurance companies currently available on a national scale.
Below you'll find auto insurance offers available from our advertising partners, followed by our complete in-depth list of the best cheap car insurance companies we've found.
Best Cheap Car Insurance Companies of 2021
Best Discount Offerings : GEICO
While inexpensive premiums help, you can also save a lot of money on your car insurance by choosing an insurance company that offers a wide variety of discounts. While most people know about typical rate reductions, like multi-car and multi-policy discounts, not everyone thinks to ask about other deals.
When we recently researched the best car insurance companies, we found that GEICO not only offered some of the cheapest rates, but they also provide the most discount options out of all the major carriers. In fact, GEICO offers nearly 20 unique discounts, from 25% to 40% off for using airbags to 15% off if you're insuring a car you bought new less than five years ago.
Coverage & Discounts
GEICO offers some of the most extensive car insurance policies in the industry. While they provide the basic coverages that everyone needs—liability and collision/comprehensive—they also offer mechanical breakdown insurance, rideshare coverage for Uber and Lyft drivers, and more. What’s more, GEICO offers coverages for other motor-operated items like motorcycles, ATVs, boats, and RVs.
As we mentioned, though, what really makes GEICO worthwhile to customers is the sheer number of discounts the company offers. The things you can get breaks for include:
- Anti-lock brakes
- Anti-theft systems
- New vehicles
- Good drivers
- Seat belt uses
- Educated drivers
- Federal employees
- Multi-vehicle and multi-policy
- Customer loyalty
GEICO offers an outstanding online experience, starting with its quick online quote process (it's one of the few companies that allows you to complete an entire quote and registration online). GEICO customers can manage policies and make any needed policy changes anytime from anywhere via the GEICO website. GEICO also offers a very comprehensive mobile app.
GEICO's digital experience doesn't just end there, though. The company also now offers connectivity with your Amazon Echo or Google Home. This means that you can now access your account information and check on the status of claims or payments anywhere in your home. Additionally, if you use an Android phone, you can use Google Assistant to request roadside assistance or access your policy info hands-free while driving.
GEICO consistently receives top ratings from both its own customers as well as industry experts. In fact, GEICO currently holds an A+ rating with the Better Business Bureau and an A++ rating (the top possible) in financial strength with AM Best. Finally, J.D. Power recently awarded GEICO with the top spot in its 2020 Insurance Shopping Study.
Read the full review: GEICO Car Insurance
Best Variety of Coverages : Travelers Insurance
Different customers have different car insurance needs, and Travelers offers options that can help you customize your policy for your specific situation. If you're a student, an experienced driver with a clean history, a homeowner, or more, you can find options to help you save.
Travelers Insurance offers all the same basic types of car insurance as most other companies. Additionally, Travelers offers some coverages that help it stand out, including GAP coverage, roadside assistance, and rental car coverage. It also features a new car replacement policy: If your car is totaled within the first five years of ownership, it will provide you with the same make and model. However, Travelers doesn't provide insurance in all states, so visit their website to verify if coverage is available in your area.
When it comes to discounts, Travelers offers breaks for:
- Multi-car and multi-policy
- Safe driving/clean records
- Automatic payment
- Hybrid and electric vehicles
When it comes to digital integration, Travelers Insurance is utilizing digital tools to offer the best possible experience to its customers. Through the MyTravelers® online portal customers can have 24/7 access to pay their bill, view or print insurance cards, view their coverage plans and other information, or even report a claim. Travelers also offers an integrated experience with your Amazon Echo, which allows you to ask Amazon’s Alexa for information on your policy or even contact your local Travelers agent.
In addition to the amazing technology integrations, Travelers offers outstanding customer service. According to National Association of Insurance Commissioners, Travelers Company Complaint Index is below the industry average. The insurer also maintains a A+ rating by the Better Business Bureau.
Best for New Drivers : Esurance
Car insurance rates can vary widely, especially for young drivers who just obtained their license. In fact, most new drivers pay significantly more for car insurance simply because they lack driving history. Luckily, though, some companies — like Esurance — offer special incentives to keep premiums low for new drivers.
Coverage & Discounts
As a branch of Allstate, Esurance offers everything you'd expect from a major car insurance company. For auto coverage, Esurance includes added perks like 24/7 roadside assistance, rental car coverage, and GAP coverage for cars under loan or lease.
Drivers can easily obtain an online quote within minutes and receive a discount for signing up for an ePolicy, which is completely paperless. Esurance also offers discounts for vehicles that include certain safety features. Additionally, high school and college students can save money for maintaining a B average.
Unlike other companies who rely on local insurance agents, Esurance focuses on online servicing. This reduces rates and makes it an especially good car insurance pick for young adults. Esurance offers the ability to do virtually everything through their website or mobile app.
When it comes to claims servicing, Esurance's digital presence makes everything easy. Customers can create claims any time and add photos to existing claims through the Esurance app, then locate a local repair facility and let the experts handle the rest. Esurance also allows customers to make changes to policies and update personal information through the app or website too, which is a refreshing change of pace to many other car insurance companies out there.
When it comes to customer satisfaction, Esurance also ranks well. In fact, the company received the number one spot for customer service in J.D. Power's 2019 Auto Insurance Study in California. Furthermore, Esurance's parent company, Allstate, holds an A+ rating of financial health from AM Best.
Best Driving Habit Discount Program : Nationwide
Many car insurance companies now offer sizeable discounts for drivers who agree to report their mileage and driving habits. Some of these programs require that you install a device directly into your car, whereas others utilize a smartphone app.
One of the most generous of these programs is Nationwide's SmartRide, which offers drivers savings that can add up to 40% of their premium costs. You even get a break for just signing up.
Coverage & Discounts
Like the other companies on our list, Nationwide offers a full range of auto liability coverages plus other vehicle-protection options. Some of the most sterling choices include accident forgiveness coverage, which protects your premium rate if you are at fault in an accident, and a total loss deductible waiver, which waves your collision or comprehensive deductibles if you total your car or someone steals it.
When it comes to discounts, Nationwide offers deals for:
- Safe driver
- Good student
- Anti-theft device
- Automatic payment
- Paperless documents
However, the most important perk we mentioned with Nationwide is the SmartRide program. Essentially, when you join it, you will receive a device that you install in your vehicle to record your driving habits: the number of miles you drive, the amount of nighttime driving, how often you do fast acceleration, hard braking, etc. Depending on these measurements, the device calculates a discount each week; after several months, a final discount rate is registered and applied when you renew your policy. You get 10% off just for enrolling in the program, and Nationwide claims, you can save up to 40% on your auto insurance.
Nationwide is trying hard to compete with GEICO when it comes to the digital experience it provides to users. They offer a mobile app for iPhones and Androids, which feature payment options, claim management and fingerprint login capabilities.
A survey of Nationwide insurance reviews does turn up a variety of customer complaints, mostly in connection to the slow claims process. With that being said Nationwide maintains full accreditation and an A+ rating with the Better Business Bureau.
Best Option for Poor Credit : Liberty Mutual
Many car insurance companies offer lower rates to customers with good credit scores and credit histories, figuring these individuals are more financially responsible and reliable (i.e., they'll pay premiums on time). Thankfully, some companies keep their rates fairly constant even for those with less-than-stellar scores. In fact, Liberty Mutual is one of the cheapest car insurance options out there for those with poor credit.
Coverage & Discounts
In addition to their economical premiums, Liberty Mutual offers some unique coverage options that really help them stand out from other insurance companies: accident forgiveness, lifetime repair guarantees, and new car replacement. Additionally, this company offers a special Teachers’ Auto Insurance that includes some perks like vandalism loss protection, personal property coverage, and collision coverage that are unique for school-related incidents.
Liberty Mutual has a variety of discounts, though some of them (like being a student with a high GPA or having a hybrid car) are only available in certain states. You can visit the Liberty Mutual website to view some of the company’s current available auto discounts or contact your nearest Liberty Mutual agent.
When it comes to online services, Liberty Mutual offers one of the most comprehensive websites in the industry. If you are not a Liberty Mutual customer but end up with in an accident with someone who is, you can file a claim against them through their website. Also, Liberty Mutual's mobile app can be used to pay bills, update policies and file claims.
While Liberty Mutual is definitely one of the top insurance providers in the nation, the company's customer satisfaction and complaint records still seem a little disproportionate to the number of customers served according to the National Association of Insurance Commissioners. With that being said, most of Liberty Mutual's complaints involve delays in the claims process or unsatisfactory offers after a loss.
Best Rates for Military Members : USAA
If you or your immediate family is a current or former military member, then you may qualify for the low rates and amazing discounts offered by USAA. Between the unique discount options and outstanding ratings, this company is hands down the best choice for any qualifying person looking for cheap car insurance.
Coverage & Discounts
USAA offers all of the basic types of car insurance coverage you could ever need. USAA also offers some great add-ons like rideshare coverage, life insurance, and medical policies. Also, like most other companies on this list, USAA provides policies for homeowners, renters, and more so that you can bundle policies and make USAA your only destination for insurance coverage.
When it comes to discounts, USAA offers most of the common discounts that people expect plus some lucrative discounts that specifically apply to military service members. For example, USAA offers discounts to those who live on base, store their vehicles, or only drive a limited number of miles per year.
USAA offers a great digital experience that includes website and mobile app access for customers. With either option, you can pay your bill, access digital ID cards, and even file claims. Furthermore, the USAA website also offers lots of information on insurance and financial planning, as well as calculators to help you plan everything out.
Although USAA is only available to current and former military members, USAA car insurance tops the charts when it comes to customer satisfaction. In fact, J.D. Power issued outstanding ratings to USAA in its 2020 U.S. Auto Insurance Study. AM Best has also given USAA the highest financial rating possible, A++.
Read the full review: USAA Car Insurance
Compare Best Cheap Car Insurance Companies
|GEICO||Best Discount Offerings|
|Travelers Insurance||Best Variety of Coverages|
|Esurance||Best for New Drivers|
|Nationwide||Best Driving Habit Discount Program|
|Liberty Mutual||Best Option for Poor Credit|
|USAA||Best Rates for Military Members|
How Can I Find Cheap Car Insurance?
Before committing to one car insurance company, it's always a wise decision to shop around and collect multiple quotes before committing to a provider; be sure to peruse the list of available discounts with each insurance company (and be sure of what's available in your state). On your own behalf, maintain a clean driving record, and find ways to improve your credit score. Also, if the company offers different types of property insurance, consider bundling your auto and homeowners policies for additional savings.
How Much Coverage Do I Need?
When you look into car insurance, it's important to remember that different types of coverage take care of a variety of damages. When determining how much car insurance you need, you should first verify what your state's required coverages include. After that, base your decisions on which coverages and deductibles you select on the age and value of your car. While things like GAP coverage and collision/comprehensive make sense for newer vehicles, they don't always provide any real benefits to drivers with older, high-mileage cars.
The Bottom Line
When you're on a tight budget, every bit of savings helps. Luckily, there are numerous ways to save money on your car insurance, and you can easily find the cheapest car insurance provider for your needs with a little bit of homework. Whether you're a safe driver who can benefit from Travelers' rates or someone who can save up to 40% by using Nationwide's SmartRide program, do your homework and compare rates side-by-side to make sure you score the cheapest car insurance that fits your needs.
How We Chose the Best Cheap Car Insurance Companies
When selecting the cheapest car insurance companies to feature in this list, we evaluated every car insurance company with national availability based on several categories. These considerations included the company’s financial strength via AM Best, satisfaction ratings from J.D. Power’s most recent Claims Satisfaction Survey, and customer-provided reviews from the Better Business Bureau, and other unbiased, data-collecting websites. In addition, we also sifted through comparison data from multiple consumer review websites and unbiased online write-ups for each company listed.