VECHILE INSURANSE COST ANALYSIS
The cost of vehicle insurance is rising, which can make it a challenge to find an affordable policy that meets specific coverage needs. The cheapest annual rates among companies in our analysis are offered by USAA, Erie, Auto-Owners, and Nationwide. These insurers have competitive sample premiums in multiple driver categories, including some categories that are typically costly to insure.
Key Takeaways
- The average annual cost of a vehicle insurance policy among insurers we analyzed is $2,068, compared to $1,459 a year ago.
- USAA has the lowest sample premiums in our study, but its policies are only available to current and former members of the military and their families.
- which is available in 12 states and Washington, D.C., has the lowest rates we found for teen drivers.
Vehicle insurance rates are highly individualized. Age, driving history, location, and many other factors influence your costs implementation. Premiums also vary widely by insurer. Some insurers do, on average, have cheaper rates than others for certain groups of motorists, to a specific company may offer the least expensive coverage for your particular situation.
Whether any insurance company in our analysis has the cheapest rates for you will depend on many variables. We’ve done the research to help you get started in your quest for the best cheap car insurance, but keep in mind: Shopping around isthe best way to find an affordable policy.
Some auto insurers have lower sample costs than others in certain driver categories. Among companies in our report, USAA, Nationwide, and Progressive are all cheapest, on average, for certain groups of drivers.
*These are sample annual premiums for different categories of drivers. Many things impact the cost of a car insurance policy, such as age, location, and driving history. Your costs may differ from those in our report. **USAA has the lowest rates we found for most groups of drivers. But since it’s only available to military members, veterans, and their families, we’ve listed insurers with the next-lowest rates throughout this report.
$2,358
2024 National Average Rate
$1,281
2023 National Average Rate
$593
Year Over Year Increase
To give consumers a context of car insurance costs across multiple driver categories, we examine rates from all 50 states for some of the nation’s largest auto insurers. Our research illustrate a substantial increase in the average cost of car insurance over the past year among companies in our study.
The national average rate for a policy among the 18 insurers in our study rose to $2,358, compared to $1,281 in 2023. The trend was also evident within specific driver classifications. Sample annual costs rose for all age groups we studied – male teen drivers, young adult drivers, and senior drivers.
Costs are also sky rocketing, on average, for drivers with blemishes on their driving records – speeding tickets, accidents, DUIs – and for drivers in other categories of our analysis.
THE CHEAPIEST VEHICLE INSURANCE COMPANIES
We ranked the best cheap vehicle insurance companies to help you find an insurer that best suits your budget. Keep in mind that these are only sample annual costs. Many factors, including your driving record, location, and age can have an impact on what you pay for auto insurance.
We found the average annual cost of a vehicle insurance policy among companies in our report is $2,068. Most of the companies we researched have sample rates below the national average.
A clean driving record – one free of traffic violations, accidents, or other infractions – can save you money on vehicle insurance. That being said, different insurers charge different rates for good drivers. Among the companies in our report, Erie has the lowest sample rates in this category for most motorists: $1,532 per year. That’s an almost 26% savings compared to the national average rate.
Cheapest for Good Drivers
$1,532
National average rate for year-long policy
$536
Savings compared to national average
Only those who qualify for a USAA policy will find lower rates, on average, among companies we analyzed. USAA’s sample annual rate is 35% below the national average. Auto-Owners and Nationwide also have average rates that are hundreds of dollars below the national average for drivers with a clean record.
Annual Rates for Good Drivers
Company |
Annual Rate |
Savings |
|---|---|---|
|
USAA |
$1,335 |
$733 |
|
Erie Insurance |
$1,532 |
$536 |
|
Auto-Owners |
$1,619 |
$449 |
|
Nationwide |
$1,621 |
$447 |
|
Geico |
$1,778 |
$290 |
|
Progressive |
$1,848 |
$220 |
|
National Average |
$2,068 |
– |
|
State Farm |
$2,150 |
-$82 |
No spam. No hidden fees.
Teen motorists are consistently the most expensive age group in our analysis to insure. Insurance companies view writing policies for young and inexperienced drivers as riskier than insuring older drivers. Erie has the lowest sample annual rates for 17-year-old female ($3,478) and male ($4,351) drivers in our analysis. Those numbers are 54% below the national average for female teen drivers and 59% lower for males.
Auto-Owners and USAA have the second- and third-lowest sample rates for teen drivers, and Geico is the fourth-lowest. Erie and Auto-Owners are not available in every state, and USAA only sells car insurance to military members, veterans, and their families, so Geico may have the lowest rates for many teen drivers across the U.S.
Cheapest for Female Teen Drivers
$3,478
17-year-old female drivers
$2,932
Savings compared to national average
Cheapest for Male Teen Drivers
$4,351
17-year-old male drivers
$3,026
Savings compared to national average
Annual Rates for Teen Female Drivers
Company |
Annual Rate |
Savings |
|---|---|---|
|
Erie Insurance |
$3,478 |
$2,932 |
|
Auto-Owners |
$3,655 |
$2,755 |
|
USAA |
$4,164 |
$2,246 |
|
Geico |
$4,908 |
$1,502 |
|
American Family |
$5,267 |
$1,143 |
|
National Average |
$6,410 |
– |
No spam. No hidden fees.
Annual Rates for Teen Male Drivers
Company |
Annual Rate |
Savings* |
|---|---|---|
|
Erie Insurance |
$4,351 |
$3,026 |
|
USAA |
$4,424 |
$2,953 |
|
Auto-Owners |
$4,673 |
$2,704 |
|
Geico |
$5,463 |
$1,914 |
|
Nationwide |
$6,358 |
$1,019 |
|
National Average |
$7,377 |
– |
Senior drivers – defined in our study as married 60-year-olds – typically enjoy the lowest average car insurance rates of any age group in our analysis. USAA has the cheapest sample rates we found for seniors, but not everyone can apply for its policies.
Erie has the next-lowest average rates for senior motorists, according to our research: $1,277 per year for female drivers (73% below the national average) and $1,224 annually for males (about 68% cheaper than average). Nationwide, which has a larger geographic footprint than Erie, also has affordable sample costs for female and male seniors with average rates 25% and 22% below the national average, respectively. Auto-Owners’ average rates are only slightly higher than Nationwide’s for female senior motorists, and are slightly lower for male drivers this age.
Cheapest for Female Senior Drivers
$1,277
60-year-old female drivers
$479
Savings compared to national average
Cheapest for Male Senior Drivers
$1,224
60-year-old male drivers
$589
Savings compared to national average
Annual Rates for Senior Male Drivers
Company |
Annual Rate |
Savings* |
|---|---|---|
|
USAA |
$1,131 |
$682 |
|
Erie Insurance |
$1,224 |
$589 |
|
Auto-Owners |
$1,359 |
$454 |
|
Nationwide |
$1,423 |
$390 |
|
Progressive |
$1,503 |
$310 |
|
National Average |
$1,813 |
– |
Current and former military members have multiple options for car insurance discounts based on their service. A number of insurers offer discounts to active-duty military members and veterans.
One company in our study, USAA, provides its car insurance products exclusively to the U.S. military community and also offers some of the lowest rates among the companies we studied across many categories.
Cheapest for Military Community
$1,335
National Average for Military Community
$733
Savings compared to national average
USAA has the cheapest sample rates in our analysis for motorists with clean driving records, 35% below the national average. It’s also the cheapest option, according to our data, for those with a single speeding violation or an accident on their record. USAA also has the lowest rates we found in multiple other driver categories.
A speeding ticket will typically lead to an increase in your vehicles insurance costs. Our research indicates that the average annual cost for a driver with a single speeding ticket is more than 20% higher than for a driver with a clean driving record.
Other than USAA, Erie has the cheapest sample costs in our analysis for this group of drivers, with a rate about 30% below the national average. Auto-Owners and Nationwide have sample annual rates 23% and 19% below the national average, respectively, for drivers after a speeding ticket.
Annual Rates for Drivers After a Speeding Ticket
Company |
Base Rate |
After Ticket |
|---|---|---|
|
USAA |
$1,335 |
$1,623 |
|
Erie Insurance |
$1,532 |
$1,765 |
|
Auto-Owners |
$1,619 |
$1,937 |
|
Nationwide |
$1,621 |
$2,032 |
|
Geico |
$1,778 |
$2,299 |
|
National Average |
$2,068 |
$2,503 |
Motorists with an accident on their driving record who can get an Erie policy might want to explore the insurer’s offerings as they search for cheap car insurance. The company has the lowest average annual rates, besides USAA’s, for drivers with a single accident on their record. Erie’s sample rate of $1,964 for this driver group is 33% below the national average.
Auto-Owners, Nationwide, and State Farm also have rates hundreds of dollars lower than the national average in this category
Progressive
A DUI can have an even greater negative impact on your car insurance costs than a speeding ticket or accident. Our research found an average rate of $3,384 for drivers with a DUI on their record – 64% higher than the average rate for motorists with a clean driving record. The increased financial strain can make it especially urgent for these drivers to find the most affordable policy possible.
That may be a policy from Progressive, according to our research. The company has the lowest sample rate we found for drivers with a DUI, 32% below the national average. Erie, USAA, and State Farm also have sample costs far cheaper than average in this category.
In some cases, drivers with DUI infractions may be required by a court or DMV to file SR-22 paperwork that proves they carry sufficient liability insurance – something many, but not all, insurers can do on a policyholder’s behalf.
Cheapest After a DUI
$2,296
National average rate after a DUI
$1,088
Savings compared to national average
According to our research, Nationwide has the lowest sample costs for drivers with poor credit, with annual rates 48% cheaper than the national average. Those eligible for USAA membership can also take advantage of low rates in this driver category, while Geico and Progressive also have competitive sample costs for drivers with poor credit.
Your credit-based insurance score is just another factor – along with the type of car you drive and your claims history – that can affect the price you pay for auto insurance. This score, which is based on factors including credit history, payment history, and outstanding debt, can predict how likely a person is to file an insurance claim, according to the Insurance Information Institute. (Note, this practice is illegal or limited in Massachusetts, California, Hawaii, Michigan, Maryland, Oregon, and Utah. Washington also implemented a limitation in March 2022 that will be in effect for three years.)
Some states don’t allow gender to be considered in setting car insurance rates, and some states restrict the use of credit-related information in determining what drivers pay for a policy.
Almost all states mandate that drivers carry a minimum amount of liability coverage. Besides USAA, which is only available to its membership, Erie has the lowest rate we found for minimum coverage, with a sample cost 26% below the national average. Auto-Owners, Geico, and Nationwide also have rates hundreds of dollars per year cheaper than the national average.
The required amounts and types of coverage vary by state, and as with other categories in our report, these are sample costs for the purpose of comparison only.
Higher levels of coverage can offer added financial protection, but are pricier than simply meeting state minimums for car insurance. Several insurers in our study offer high-coverage rates below the national average.
Erie’s rate in this category, $1,574 per year, is 27% below the national average, lower than all other insurers in our rating besides USAA. Other companies with sample rates far below the national average include Nationwide, Auto-Owners, and Geico.
The national average rate for car insurance is $2,068 per year, based on our analysis of the 10 insurers in this report. Six of these companies have annual rates below the U.S. average: USAA, Erie, Auto-Owners, Nationwide, Geico, and Progressive. Among insurers in our analysis, State Farm, American Family, Farmers, and Allstate have sample rates higher than the overall national average.
To find the cheapest car insurers in each state, we analyzed car insurance rates for drivers across the country. The rates provided here are sample costs taken from representative driver profiles, so the premium you pay for a policy may differ.
It’s important to note that our data may not include all the states each company operates in. The rates presented here are for comparative purposes only.
State |
Insurer |
|---|---|
|
Alabama |
Progressive |
|
Alaska |
USAA |
|
Arizona |
Root |
|
Arkansas |
USAA |
|
California |
Wawanesa General |
|
Colorado |
Geico |
|
Connecticut |
Geico |
|
Delaware |
State Farm |
|
District Of Columbia |
Geico |
|
Florida |
State Farm |
|
Georgia |
Auto-Owners |
|
Hawaii |
Geico |
|
Idaho |
State Farm |
|
Illinois |
Country Financial |
|
Indiana |
USAA |
|
Iowa |
State Farm |
Even if you’re satisfied with your current auto insurance, it doesn’t hurt to check every year to see if you can find the same coverage for less money. Consider these steps to save on car insurance and get the cheapest rate possible:
Shop Around
Comparing quotes from multiple companies is the first step toward getting cheap car insurance. Be sure to ask each insurer about how to adjust your level of coverage to fit your current needs.
Ask for Discounts
Nearly every insurance provider has discounts available for its customers. These can include lower rates for customer loyalty, maintaining a clean driving record, and good students.
Increase Your Deductible
Premiums are determined in part by the deductible you choose, which is the amount that you agree to pay if you need to file a claim. Opting for a higher deductible is one way that you can lower your insurance costs.
Decrease Your Limits
Limits refer to the amount of money your insurer will pay after a claim. Higher limits can decrease your out-of-pocket expenses after a claim. They can also drive up your annual premium. Review your personal finances and determine if lowering your limits is worth the lower rates as lower limits could lead to greater out-of-pocket costs in the event of an accident.
Understand State Requirements
Nearly every state has auto insurance requirements that determine the minimum amount of coverage a driver must carry. Factoring in your state auto insurance requirements, alongside your personal assets and finances, can help you decide how much coverage you need or if you’ve purchased too much coverage.
Bundle Your Insurance
Most companies offer car insurance discounts if you buy two or more policies. This could include purchasing a renters or homeowners policy with the same company.Â
Improve Your Driving Record
Insurance companies reward safe drivers with clean records by giving them lower rates. This is because good drivers are less likely to file a claim.
Switch to Pay-Per-Mile Insurance
This type of coverage replaces your traditional car insurance policy, and the main difference is that you pay for auto insurance by the mile. If you put only a few miles on your car every year, the savings may be worth making the switch.
Review Coverage Annually
Take a look at your policy when it’s time to renew. Adjust your coverage, such as your deductible or the number of miles that you drive, to fit your current needs.
Pay Premiums Annually
Most insurance companies will allow you to pay for coverage monthly, biannually, or annually. However, paying your premiums annually will almost always save you money and reduce cost.
Improve Credit Rating
In most states, drivers with poor credit scores are penalized with higher insurance rates. Maintain a good credit score, or take steps to improve your credit, and you’ll likely secure a better rate.
Look for Local Insurers
It’s possible that a large insurer might not be the best or cheapest match for your coverage needs. Check with smaller insurers or with a local agent to see if you can find a lower rate.
Drivers can lower their auto insurance premiums if they qualify for certain discounts, like safe driving, loyalty, and vehicle safety features. We’ve outlined a few common discounts drivers may be eligible for:
- Safe driving.ÂDrivers who haven’t filed a claim, received a ticket, or been involved in an accident might qualify for safe driving discounts.
- Telematics devices.ÂTelematics devices track your driving behaviors and report them to your insurance provider. Insurers may reward drivers who practice good driving habits, such as abiding by speeding limits and avoiding phone usage.
- Anti-theft and safety features.ÂVehicles with anti-theft devices (like a car alarm) or passive restraints (like airbags) may qualify for discounts.
- Good student.ÂHigh school and college-aged drivers who maintain at least a B average may be eligible for lower auto insurance rates.
- Low usage.ÂVehicles with minimal annual use can often qualify for discounts. Less frequent driving reduces the likelihood that the driver or vehicle will be involved in an accident.
- Bundling.ÂDrivers who bundle their auto insurance with home, life, or renters policies can save on all applicable premiums.
- Multicar.ÂPolicyholders can reduce their premiums if they insure more than one vehicle with the same provider.
- Payment.ÂPaying in full upfront, enrolling in AutoPay, or requesting paperless statements often results in cost savings.
- Loyalty. Many insurance companies offer rewards programs for drivers who’ve been with them for years.
- Defensive driving.ÂInsurers often offer discounts to drivers who provide proof of participation in an accredited drivers’ safety program.
It may be tempting to get the cheapest car insurance you can find – but it’s not always a good idea. Low-cost policies often have higher deductibles and lower coverage limits, which means you’ll have to pay more out-of-pocket if you have an accident or your car is damaged. While it’s less likely, the coverage on a cheaper policy might be minimal, leaving you underinsured in some states.
Cheap auto insurance also may not include important types of coverage, like comprehensive or collision coverage. You could spend significant amounts on repairs, especially if you drive a newer or more expensive car, offsetting any savings from a cheap policy in the first place.
Remember that customer service is a huge part of quality auto insurance too. Choosing a cheaper company may mean customer service, or other offerings, could be lacking. Whether it’s slow claims processing, poor customer service, or worse, financial instability, these issues could result in frustration that could be avoided using a more reputable insurer. Be sure to research an insurer thoroughly before signing on the dotted line.