Cheapest Car Insurance Companies

Key Points:

• The top cheap car insurance companies are USAA, Erie, Nationwide, Country Financial, and Farmers.
• The best way to find the cheapest coverage is to compare quotes from several insurers.
• Make sure to inquire about discount opportunities offered by your insurance provider.

Our team did an in-depth, industry wide review of the best car insurance companies in the country. In this article, we’ll look at which insurers offer the cheapest car insurance and evaluate them by cost, available discounts, and customer reviews.

Cheapest Car Insurance Companies

Based on our industry-wide research, we found that the top five providers of cheap auto insurance are USAA, Erie, Nationwide, Country Financial, and Farmers. In the sections below, we’ll take an in-depth look into each company.

*All cost data is for the profile of a 35-year-old driver with good credit and a clean driving record unless otherwise noted.

#1 USAA: Best For Military Members

Founded: 1922

AM Best Rating: A++

Better Business Bureau (BBB) Rating: NR

According to the National Association of Insurance Commissioners (NAIC), USAA is the fifth-largest auto insurer in the U.S. In 2022, the company captured 5.92 percent of the market share and wrote over $16.4 billion in car insurance premiums. USAA offers insurance coverage to members of the military, veterans, and their children.

USAA Pros And Cons

Here are some pros and cons of insurance coverage from USAA.

USAA Average Auto Insurance Rates

USAA is one of the cheapest auto insurance providers on the market. Full-coverage policies from the company cost an average of $88 per month or $1,054 per year. USAA coverage is about 39 percent cheaper than the national average.

USAA Insurance Cost For Teen Drivers

Teen drivers typically pay the most for car insurance coverage. Here’s a table that shows average costs for teen drivers covered by USAA.

USAA Insurance Cost For Other Driving Profiles

Below are averages for 35-year-old male drivers with speeding tickets, DUIs, or recent accidents.

USAA Car Insurance Discounts

In addition to offering some of the cheapest rates, USAA provides the following discounts to policyholders:

USAA Customer Reviews

USAA has an average star rating of 1.1 out of 5.0 on the BBB’s website and 1.3 out of 5.0 on Trustpilot. Though the ratings are low, it’s important to keep in mind that both sites have less than 2,000 USAA reviews, which is a small fraction of the company’s consumer base.

Positive reviews mention excellent customer service, while negative reviews often cite a slow claims process.

#2 Erie Insurance: Best Basic Coverage

Founded: 1925

AM Best Rating: A+

BBB Rating: A+

Erie is a midsize insurance company that serves 12 states in the Northeast, Southeast, and Midwest. According to the NAIC, the company Erie Insurance held 1.30 percent of the market share and wrote almost $3.6 billion in insurance premiums in 2022.

Erie Insurance Pros And Cons

Below are some of the pros and cons of Erie Insurance.

Erie Average Auto Insurance Rates

We found that Erie car insurance coverage costs about 28 percent cheaper than the national average. A full-coverage policy from Erie usually runs an average of $103 per month or $1,238 per year.

Erie Insurance Cost For Teen Drivers

Car insurance typically costs a lot more for teen drivers than older drivers. Below is a table showing how much teen drivers pay for an Erie full-coverage policy on average.

Erie Insurance Cost For Other Driving Profiles

Speeding tickets and other violations can raise your insurance rates. Below, we take a look at the cost of Erie full-coverage car insurance for 35-year-old male drivers with recent speeding tickets, DUIs, or at-fault accidents.

Erie Car Insurance Discounts

In addition to being one of the cheaper car insurance companies available, Erie offers many ways to save money on your premium. Here are some of Erie’s discount opportunities:

Erie Insurance Customer Reviews

Erie Insurance holds a 1.1-star rating out of 5.0 from customers on the BBB’s website. It fares a little better at Trustpilot, receiving an average rating of 2.9 out of 5.0 at Trustpilot. Like a lot of insurance companies, a tiny fraction of its customer base left reviews. In Erie’s case, there are just over 60 reviews total across both sites.

Positive reviews praise Erie’s customer service, while negative reviews mention poor communication.

#3 Nationwide

Founded: 1987

AM Best Rating: A+

BBB Rating: A+

Headquartered in Columbus, Ohio, Nationwide is a large insurer available to drivers in all 50 states. According to findings from the NAIC, Nationwide held 1.99 percent of the market share and wrote over $5.5 billion in insurance premiums in 2022.

Nationwide Insurance Pros And Cons

Here are some pros and cons for Nationwide Insurance.

Nationwide Average Annual Auto Insurance Rates

Based on our research, Nationwide is one of the cheapest companies in the nation. A full-coverage policy from Nationwide costs an average of $107 per month or $1,281 per year, about 26 percent less than the national average.

Nationwide Insurance Cost For Teen Drivers

Young drivers often pay much more for auto coverage than those with more experience behind the wheel. Here is a table that shows average rates for drivers aged 16 through 19 insured by Nationwide.

Nationwide Insurance Cost For Other Driving Profiles

Traffic violations, whether an accident, speeding ticket, or other infraction, can cause your insurance rates to increase. In the table below, we look at how recent tickets, DUI convictions, or at-fault accidents affect the cost of a full-coverage Nationwide policy for a 35-year-old male driver.

Nationwide Car Insurance Discounts

In addition to Nationwide’s below-average car insurance rates, the company offers many discounts. These include:

Nationwide Insurance Customer Reviews

Nationwide holds an average rating of 1.1 stars out of 5.0 on the BBB and 1.8 out of 5.0 stars on Trustpilot. Though these ratings are low, only around 260 customers reviewed the company on the BBB. 22 left reviews on Trustpilot.

Positive Nationwide reviews mention attentive insurance agents. Negative reviews cite the inability to view policy details online.

#4 Country Financial

Founded: 1924

AM Best Rating: A+

BBB Rating: A+

Country Financial is an auto insurance company based in Bloomington, Illinois. According to the most recent NAIC study, Country Financial held 0.44 percent of the market share in 2022. The provider wrote over $1.2 billion in insurance premiums.

Though our research found that Country Financial offers some of the best cheap car insurance in the industry, its products are only available in 19 states.

Country Financial Pros And Cons

Here are a few pros and cons of Country Financial.

Country Financial Average Annual Auto Insurance Rates

Country Financial policyholders typically pay about 25 percent less than the national average. A full-coverage policy from the provider costs an average of $108 per month or $1,295 per year.

Country Financial Insurance Cost For Teen Drivers

Our research found that Country Financial offers some of the lowest rates for young drivers, as shown by the table below.

Country Financial Insurance Cost For Other Driving Profiles

Any moving violation will increase your insurance rates, some more than others. The table below shows how much a full-coverage policy from Country Financial will cost on average for various infractions, based on the driver profile of a 35-year-old male.

Country Financial Car Insurance Discounts

Country Financial has a solid offering of discounts available to policyholders. These include:

Country Financial Customer Reviews

Though Country Financial has an A+ rating from the BBB, it doesn’t have any customer reviews on the site. On Trustpilot, the company has an average star rating of 2.9 out of 5.0. There are only two reviews on Trustpilot, neither of which have to do with the company’s auto insurance.

#5 Farmers

Founded: 1928

AM Best Rating: A

BBB Rating: A

Farmers is a large insurance company available nationwide. According to the most recent findings from the NAIC, Farmers held 4.55 percent of the market share in 2022. The company wrote just over $12.6 billion in insurance premiums.

Farmers Pros And Cons

Below are some pros and cons of Farmers Insurance.

Farmers Average Annual Auto Insurance Rates

Though Farmers offers affordable rates for car insurance, the company is a little on the more expensive side in our roundup of cheap car insurance companies. A full-coverage policy can cost an average of $178 per month or $2,140 per year, which is about 24 percent more expensive than the national average.

Farmers Insurance Cost For Teen Drivers

Car insurance for teenage drivers tends to be a lot more expensive than for drivers over 25. Young drivers insured through Farmers pay some of the highest insurance costs. The table below shows average costs for drivers ranging from age 16 to 19.

Farmers Insurance Cost For Other Driving Profiles

Having a ticket, accident, or DUI on your driving record can raise your insurance rates through the roof. Below is a table that shows full-coverage costs for 35-year old male drivers with Farmers policies who have a recent traffic violation.

Farmers Car Insurance Discounts

Farmers offers numerous opportunities for policyholders to save money. Car insurance discounts from Farmers include:

Farmers Customer Reviews

Farmers holds an A rating and accreditation from the BBB, but has low customer reviews. Customers on the BBB’s website give the company an average of 1.3 stars out of 5.0, while customers on Trustpilot give Farmers a slightly better average of 1.6 stars out of 5.0. However, it’s important to note that there are only around 300 reviews on the BBB and just over 70 on Trustpilot.

Average Cost Of Car Insurance

Based on data we received from Quadrant Information Services, a company that specializes in pricing analytics of property and casualty insurance providers, we found that the average cost of state minimum car insurance is $635 per year. A full-coverage insurance policy costs an average of $1,730 annually.

Factors That Affect Car Insurance Costs

While every provider will offer different rates for your car insurance policy, most use the same factors to calculate premiums. In general, how much your car insurance costs depends on the following:

• Age
• Gender
• Marital status
• City and state
• Vehicle model, age, and mileage
• Vehicle safety features
• Credit score
• Driving history

The cheapest car insurance premiums are typically offered to drivers over the age of 25 with a clean driving record and high credit score. Those who live in cities with lower theft and accident rates will also see cheaper premiums. State insurance regulations, including which coverage is required, can impact rates as well.

Common Car Insurance Discounts

The car insurance discounts you may qualify for differ from provider to provider, but there are some that are more common than others. Most standard auto insurance discounts fall into one of the following categories:

• Policy discounts: These are administrative discounts, meaning you can earn discounts by signing up for automatic bill pay, using electronic payments or paperless billing, and paying your premium in full.
• Vehicle: Many companies offer lower rates if you have anti-theft devices installed in your vehicle. These discounts may also include savings for safety features like anti-lock brakes, daytime running lights, and air bags.
• Driving profile: Good driver discounts are pretty common at most insurance companies. People with clean driving records can usually find savings. Most of these companies also usually offer low-mileage discounts available to those who don’t drive much.
• Usage-based: Usage-based insurance programs, also known as telematics insurance, provide savings for practicing safe driving habits. These programs use mobile apps, Bluetooth devices, and plug-in devices to track certain actions for a set period of time.
• Driver affiliations/status: Affiliation discounts include members of the military, corporate group members, and students away from home. Homeowners and renters can also get discounts from many companies by bundling auto policies and other insurance products.

Types Of Car Insurance Coverage

There are two main insurance policies you can purchase, state-minimum coverage or full coverage.

What Is Minimum Insurance?

Each state (except for Virginia and New Hampshire) requires drivers to hold a certain amount of auto insurance in order to legally drive. In many states, it means drivers must carry a certain amount of liability coverage, but not much more. Some states require some form of medical coverage and others require drivers to have uninsured motorist coverage.

What Is Full-Coverage Insurance?

There are six main types of car insurance that typically make up a full-coverage insurance policy. Though not required by state law, you may be required by your lender or lessor to carry a full-coverage policy for the life of the loan or lease.

Additional Car Insurance Coverages

Aside from the main kinds of coverage, most insurers offer optional coverages you can add to your policy. These additional types of car insurance include:

• Roadside assistance: This coverage provides assistance for breakdowns on the road. It often includes towing, jump-starts, and lock-out assistance.
• Rental car reimbursement: If your car is in the shop, this coverage helps provide you with a rental car.
• Total loss protection: If your car is deemed a total loss after an accident where another driver is at fault, this coverage provides money to replace your vehicle.
• Gap insurance: This coverage helps you pay off your loan in the event that your car is totaled and your claims payout is less than your loan balance.

How To Shop For Car Insurance Quotes

You have a few options for sourcing auto insurance quotes. The fastest, typically most convenient option is to use a provider’s online quote tool. Most insurers offer instant quotes or comparison tools on their websites.

If you’d rather get a quote in person, you can contact an insurance agent or company representative. This method is usually a bit more time consuming, but if you have any questions, you can ask a person directly.

Here are some more details on how to shop for car insurance:

• Quote comparison tool: Quote comparison tools use information about you and your vehicle to let you compare multiple quotes from different providers at the same time. In our 2022 car insurance survey which polled 1,000 respondents, we found that 30 percent of respondents used a quote comparison tool. Among those surveyed, it was the most popular way to shop for car insurance.
• Quotes by phone: Calling an insurance provider directly can be of use in a couple of different ways. First, you’ll get a quote directly from the provider you’re researching. Second, you’ll get a sense of that provider’s customer service. Almost 21 percent of respondents to our survey called car insurance companies for a quote.
• Online quote: Most insurers offer free, instant quotes via their websites. You’ll input personal and vehicle information and the tool will calculate your quote within seconds. According to our survey, about 24 percent of the 1,000 respondents sourced quotes directly from providers.
• In-person quotes: If you work with a broker or a local insurance agent, you get in-person quotes. This tends to be a more time consuming process, as you’ll have to schedule an appointment and travel to the office during normal business hours. Close to 16 percent of respondents in our survey cited a preference for speaking with an insurance agent or broker when shopping for car insurance.

How To Get Cheap Car Insurance

No matter how much or how little you pay, it’s worth trying every method available to lower your premium. Below, we’ve compiled a few tips for lowering your car insurance rates.

Shop Around

If you think you’re paying too much, start looking to see if you could save money by switching to another insurance provider. You can cancel your insurance at any time. Some companies even offer discounts for switching.

Bundle Policies

If you have other insurance products like homeowners, life, or renters insurance, you may be able to get a discount by purchasing them from the same company as your auto coverage. Additionally, if you have more than one vehicle, most insurers offer a discount for having multiple cars on the same policy.

Ask About Discounts

Nearly all insurance companies offer at least a few discounts. Ask about which ones you may qualify for. In addition, many companies offer telematics insurance programs, which monitor driving habits and provide discounts for safe drivers.

Take A Defensive Driving Class

Every state offers defensive driving classes and some require insurers to provide discounts to drivers who complete the course. These are especially helpful for younger drivers, who pay the most for car insurance coverage.

Improve Your Credit Score

Unless you live in California, Hawaii, Maryland, Michigan, and Massachusetts, states that ban or significantly limit insurers’ use of credit scores to set rates, this is a good way to lower your premium. Pay all of your bills and debts on time and in full to bump your credit score up a few points.

Reassess Your Coverage

Whenever your life circumstances change, it’s a good idea to reassess your auto insurance policy and perhaps shop for a new one. Your current insurance provider may not offer the cheapest car insurance for your new situation.

Times to take another look at your insurance coverage include:

• Credit score changes
• Moving
• Getting married or divorced
• Buying a house
• Turning 25

Reduce Your Coverage

Every state except for Virginia and New Hampshire require you to carry state-minimum coverage in order to legally drive. We generally recommend most drivers purchase comprehensive and collision coverage as well, but if you’re looking to lower your insurance costs, you can drop extra coverage.

Cheapest Car Insurance: Conclusion

When looking for the cheapest auto insurance, we recommend sourcing quotes from USAA, Erie, Nationwide, Country Financial, or Farmers. In order to get the best rates, always compare a few different quotes. Once you decide on a provider, make sure you know what discounts you qualify for.

Cheapest Car Insurance: FAQ

How We Rate Insurers

Our review process aims to deliver consistent and unbiased assessments of car insurance providers. While there are multiple qualities that make a car insurance company successful, our review team focuses on those we believe are the most important for consumers:

• Cost: Cost can be difficult to compare between insurers because so many factors impact annual premiums. The cheapest insurer for one driver may not be the cheapest for another. To determine our cost score, we look at insurance rate estimates generated by Quadrant Information Services, discount opportunities, and consumer reports.
• Coverage: To determine our coverage score, we look at the number of coverage options available as well as coverage limits and deductible options. Our ratings also take into account additional services and benefits like roadside assistance.
• Reliability: It’s important that an auto insurer is able to meet its claims obligations. Companies with a strong financial strength rating from AM Best score best in this category. Established insurers with a long history of reliable service also receive positive marks.
• Service: We comb through customer reviews on sites like the Better Business Bureau (BBB) to learn about customer experiences. Insurers with a low volume of complaints score well in this area. We also consider the claims process, giving higher ratings to car insurance providers that offer easy-to-use claims apps.

*Data accurate at time of publication.