The exact definition of a “low-income driver” can vary. But in general, low-income families are those with earnings that fall below the U.S. Department of Health and Human Services’ poverty guidelines. For 2024, a person with an annual income of $15,060 or below is considered a low-income earner, while the annual threshold for a family of five is $36,580.1

If you’re a low-income Texas driver, you have options for finding cheaper car insurance rates. The Lone Star State doesn’t subsidize auto coverage for its low-income drivers, but it only requires drivers to obtain liability coverage, which is much cheaper than full coverage. Many companies also provide discounts that can reduce your insurance rates.

Here’s what you should know about comparing quotes and finding car insurance for low-income earners in Texas.

Cheapest low-income car insurance in Texas

Drivers in Texas pay an average cost of $124 per month for liability-only insurance and $218 per month for full-coverage car insurance, according to Insurify data. While State Farm has the cheapest liability rates on average, other insurance companies may also offer coverage that aligns with your budget.

Here are some of the cheapest car insurance companies in Texas.

Best car insurance for drivers with a low income in Texas

Liability-only insurance is the cheapest form of car insurance. But it offers less protection than a full-coverage policy, which typically includes liability insurance, comprehensive insurance, and collision insurance.

For example, liability coverage won’t pay for your injuries or damage to your car if you’re at fault in a motor vehicle accident or if a tree limb hits your car’s roof. It only covers damages to another person or their vehicle if you’re at fault in an accident.2

If you’re seeking cheap liability coverage, it’s worth getting a quote from State Farm, GEICO, and Allstate.

State Farm: Best for customer satisfaction

GEICO: Best for military families

Allstate: Best for discounts

Cheapest car insurance for drivers with poor credit in Texas 

While it’s illegal for insurers in some states to consider your credit history when calculating your insurance rates, this practice is legal in Texas. Drivers with poor credit often pay more for car insurance, as insurers may view them as more likely to file a claim. 

By contrast, drivers with good or excellent credit often get lower rates. Other factors also affect the cost of car insurance, like your city, age, and ZIP code.

Here’s a quick cost comparison for how much Texas drivers with good credit and poor credit pay each month for a liability policy.

Minimum car insurance requirements in Texas

Texas requires drivers to obtain the following car insurance coverages in order to be roadworthy:4

Your liability insurance will pay out if you’re at fault in a car accident that results in damage to another person’s vehicle or personal property. It’ll also pay for their medical bills if they’re hurt in the accident.

A liability-only policy could be sufficient if you drive an older or high-mileage vehicle, though it doesn’t offer as much protection as full-coverage insurance. Likewise, opting for minimum coverage might save you money, but it could put you at risk if you get into an accident and the related expenses exceed your coverage limits.

State-sponsored car insurance in Texas

Unfortunately, the Texas government doesn’t subsidize car insurance costs for low-income drivers, and the state’s car insurance rates are on the high side compared to other U.S. states.

The best way to find an inexpensive auto policy in Texas is to shop around, get quotes from several different car insurance companies, and take advantage of as many discounts as possible.

Car insurance discounts for low-income Texas drivers

Discounts are another great way to save some money on your auto policy. Here are some common ones to look for:

Low-income car insurance in Texas FAQs