How to Get Cheaper Car Insurance With a Low Income
Take advantage of your state’s low-income car insurance program and money-saving strategies to get the best rates.
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Car insurance can be expensive, especially for low-income households, but you have several ways to make your premiums more manageable.
The good news is that insurance companies don’t use your income level as a factor to determine car insurance rates. And if you’re a low-income driver, you may qualify for your state’s government assistance program to get cheaper car insurance.
Cheapest car insurance companies for low-income drivers
COUNTRY Financial, Auto-Owners, and USAA offer some of the most affordable liability insurance coverage nationwide. Pay-per-mile companies, like Hugo and Mile Auto, can also help lower your cost of car insurance if you’re an infrequent driver.
Take a look at the table below for the companies with the cheapest average liability-only rates.
You can lower your car insurance costs by using one or more of the following strategies.
1. Take advantage of state-sponsored programs
California, Hawaii, Maryland, and New Jersey offer low-income car insurance programs to eligible drivers. These programs provide cheap or free car insurance, allowing low-income families to drive legally.
2. Compare car insurance quotes
Insurance companies weigh various factors and calculate costs differently, so your premiums will vary by insurer. By shopping around, you can save upwards of 30% on your policy. You can use an online quote-comparison tool to find the best price for your situation.
Follow these steps to get a quote:
Provide personal information. Answer a series of questions about yourself, your vehicle, and your driving history.
Compare real-time quotes. Compare cost, coverages, and company reputation to find the best option for car insurance.
Purchase a policy. Finalize your insurance policy online or by speaking to an agent.
3. Ask for common car insurance discounts
Insurance companies offer discounts to reward safe driving and promote loyalty. If you’re looking to save money on your policy, check your insurer’s website or ask your agent for any deals you may qualify for.
Below are a few common discounts to ask about:
Good driver discount: Save up to 22% if you’re a driver who hasn’t been involved in an at-fault accident or received a ticket during a set period of time.
Telematics program discount: Participating in your company’s usage-based insurance program can result in a discount of up to 30% on your policy.
Multi-policy discount: Bundle multiple insurance products, like auto and home insurance, to save up to 25% on car insurance.
Good student discount: Students who earn good grades can get up to 15% off their insurance policy.
Military discount: Active-duty military members and veterans can qualify for up to 25% off their insurance policy with a military discount.
4. Consider pay-per-mile car insurance
With pay-per-mile insurance, your monthly premiums are tied to your mileage. You’ll pay a base rate plus a per-mile rate. For example, on its website, Mile Auto includes a monthly rate with a potential base rate of $48 and a per-mile rate of 8 cents. So, if you drove 300 miles, you’d pay a $72 premium for that month.
Pay-per-mile insurance is cheapest for people who don’t drive much, such as retirees or people who work from home. If you commute frequently, other insurers might be a more affordable option for you.
5. Reduce your coverage amount
A liability insurance policy is generally the least expensive option. If you’re on a tight budget, consider downgrading to your state’s minimum auto insurance requirements — but be aware of the risks.
A liability-only policy provides bare-minimum coverage and covers only the other parties’ expenses and injuries in an accident you cause. It doesn’t protect you or your vehicle, so you’d be financially responsible for your own expenses and vehicle repairs if you’re at fault in an accident. Depending on the severity of the incident and your car’s value, this could be costly.
One caveat: If you finance or lease your vehicle, your lender will probably require you to maintain a full-coverage policy. In that case, consider other strategies to lower your premiums.
6. Buy a car that’s cheaper to insure
If you find yourself in the market to buy a car, compare features before buying to determine how those features will affect your premiums. Older, lower-value vehicles with equipped safety features are generally cheaper to insure. Meanwhile, newer or luxury cars require more coverage, so they’re costlier to insure.
The table below shows the cheapest vehicle makes and models to insure, according to Insurify data.
Low-income car insurance FAQs
If you’re a low-income driver in the market for car insurance, finding affordable coverage is possible. Check out the additional information below about low-income auto insurance options.
Who has the cheapest car insurance?
COUNTRY Financial, Auto-Owners, and USAA offer some of the most affordable liability insurance coverage, according to Insurify rate data. But the company that’s cheapest for you will depend on your driver profile and coverage needs.
Which insurance companies cater to low-income drivers?
Many insurance companies offer affordable car insurance. COUNTRY Financial, Auto-Owners, and USAA are just a few, according to Insurify’s round-up of cheap car insurance companies. In addition, California, Hawaii, Maryland, and New Jersey have programs to assist low-income drivers with insurance coverage.
Which cars are the cheapest to insure?
The cheapest cars to insure are older, are less expensive, and have safety features. The cheapest used cars to insure are the Chrysler Town & Country, Honda Odyssey, and Subaru Forester. The cheapest new cars to insure are the Honda CR-V, Nissan Rogue, and Toyota RAV4.
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