If you’re wondering who has the cheapest car insurance, studies by the U.S. News, The Zebra, and Nerdwallet show that USAA offers the lowest rates, on average, while Geico’s rates come in second. This guide will help you understand some of the factors that affect rates, as well as which companies tend to offer the best prices. Auto insurance is an absolute must when you own and drive a vehicle. Each state has its own requirements and regulations for drivers, as do car financing and leasing providers. Not only is it a requirement, but it is something that will protect you financially if you are involved in an accident. The last thing you need to worry about is having to pay thousands of dollars for vehicle repairs, property damage, or even medical bills if you have an accident. Auto insurance companies protect you from having to pay these costs out of your own pocket.
The two lowest or cheapest car insurance rates
According to studies by Zebra and Nerdwallet, USAA is the most affordable cheapest car insurance company on the overall list. Their study fee is $ 895 and this company features the lowest auto insurance study rates across the multiple demographic profiles used in the study, ranging from 60-year-old women to 25-year-old men.
Nerdwallet, U.S. News, Value Penguin, and Zebra agree that Geico offers the second-lowest auto insurance rates, based on its study fee of $ 1,063. Additionally, Geico’s representative rates for a 25-year-old driver profile in the study are significantly lower than the rates offered by other auto insurance companies, as well as the study rates for the profiles included in the study with an accident in their records.
Additional affordable businesses
Of the cheapest car insurance companies, Travelers ranks third on our list. The representative rate for a policy is $ 1,212. When we use most of the driver profiles we use, Travelers remains in third place, although for several profiles it falls to fourth place, allowing State Farm to move to third place.
According to our analysis, Nationwide is the seventh cheapest company on the list. Study fees between American Family and Nationwide go up about $ 200, while Nationwide’s fee is $ 1,530. Although Nationwide coverage is more expensive than most other companies on the list, this company offers some of the lowest study fees for drivers with low credit scores.
Of the companies on this list, Progressive’s representative insurance rates are the fifth-lowest. Based on the driver profiles used, the study fee is $ 1308 per year. For certain profiles, such as those in their 60s, Progressive’s rates are very competitive.
Most expensive auto insurance companies
In our analysis, the auto insurance rates offered by Farmers are substantially higher than average. The study fee is $ 1,538 per year, making Farmers the second most expensive company in our study.
We found State Farm to be the second most expensive overall among the top nine auto insurance companies on the list. Their study fee is $ 1,260, a rate that is well above the average for most of the other nine companies.
According to various driver profiles, the study fees for Allstate are $ 1,778 per year. This cost is approximately $ 450 above the national average rate in the study. It’s almost $ 900 above the rate for USAA, the cheapest auto insurance company in our study.
Regional and local companies
When comparing auto insurance rates, it is important to note that not all companies offer insurance nationwide.
- Allstate, USAA, State Farm, and Geico are available in every state and in Washington, D.C.
- American Family is available in 19 states.
- Travelers is available in 24 states.
- Farmers is available in 31 states.
- Nationwide is available in 43 states.
- Progressive is available in 48 states.
Factors that impact rates
Insurers set rates based on several key factors that essentially allow them to determine how likely you are to file a claim, based on your prior data and experience. The ideal customer of an auto insurance company is a safe and experienced driver who has a safe vehicle that is inexpensive to repair and drives minimally in an area with a low risk of natural disasters, little congestion, and low crime rates. This ideal client would allow the insurance company to make a profit because they are likely to pay their premiums without making costly claims on their policy.
How to reduce your rate
If you want to lower your insurance rates, look for discounts through the various insurance companies. You can ask your insurance agent about available discounts, as the company may offer discounts that you are eligible to receive but are not taking advantage of on your policy. For example, you may qualify for a lower mileage discount if your driving habits changed due to a change in your lifestyle. When requesting auto insurance quotes from various providers, be sure to ask about all the discounts that are available to you.
Traffic violations and insurance rates
When a driver profile has a speeding ticket, study fees start to rise. This correlation is due to the fact that drivers who accelerate are more likely to be involved in accidents. For those with a speeding ticket, USAA offers the lowest rates, but the cost increases by about $ 130 for a driver profile with a ticket on their record.
If a driver profile has an accident, the rates increase even more. USAA is still the lowest priced option for drivers with an accident, but its rates increase by about $ 320 per year compared to a driver without an accident on their record. The average increase in survey rates for accident drivers across all listed companies is $ 300 per year.
Drivers who have been cited for driving under the influence pay much higher insurance rates. This is because drivers who drive under the influence of alcohol are at extremely high risk of causing an accident. The driver profile used in our study with a DUI shows how certain insurance companies penalize this offense more than others. Although Geico is the second cheapest overall in our analysis, the rates for profiling with a DUI are some of the highest in the study. USAA also has higher insurance rates than State Farm for this driver profile, making State Farm the most affordable for a driver with a DUI.
Another factor that affects your auto insurance rates is your credit rating, due to the fact that bad credit can make a driver riskier to insure. The profiles used in our study with good credit qualified for an average rate of $ 1306 per year, while the average annual rate for profiles with bad credit was $ 2318.