Cheapest Used-Car Insurance (2025)
Used-car insurance costs an average of $198 per month, which is the same as the average cost of coverage for a new car.
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Saving money is one of the biggest perks of buying a used car. The average cost for used car coverage is $198. Though liability-only rates may be similar to insuring a new vehicle, full-coverage car insurance is generally cheaper for used cars.
Major insurance companies, like USAA, State Farm, and GEICO, have average monthly prices of $50 or less for used vehicles. Learn more about used car insurance and if it’s right for you.
How much does car insurance cost?
The average cost of used-car insurance is $198 per month. But you might pay significantly more or less, depending on the insurer you choose.
The same factors that affect the cost of new-car insurance also affect the cost of used-car insurance. Insurers consider your age, vehicle type, driving record, location, and gender when determining insurance costs.1
Cheapest used-car insurance
Most factors that determine car insurance costs are out of your control. But here’s the good news: Comparing quotes from multiple insurers is one of the quickest and most effective ways to lower car insurance costs. The following companies offer the cheapest car insurance rates for used cars.
Is it cheaper to insure a used car?
Insurance prices are usually much higher for new cars than used cars, especially for liability-only coverage. Liability insurance covers the cost of repairs and medical care for the other driver when you’re at fault for an accident.
Here’s how average insurance prices differ depending on the car model and age.
How to get cheap used-car insurance
Car insurance is a mandatory monthly expense that can add up. Here are steps you can take to lower your car insurance costs for a used car:
Compare multiple quotes. Get quotes from at least three insurers before you select a policy. Comparing quotes allows you to find the best deal.
Increase your deductible. When you increase your deductible, your monthly insurance costs usually decrease. The trade-off is that you have to pay more if you plan to use your insurance after an incident.
Ask about discounts. Most insurance agents notify you of discounts, but it’s always a good idea to double-check. Insurance companies offer discounts for safe driving, loyalty, military affiliation, and good grades.
Bundle insurance policies. Insurance companies often offer a discount for bundling different types of policies. For example, you might be able to bundle home insurance, auto insurance, and business insurance.
Used-car insurance coverages
Insurance companies typically offer two coverage options: liability only and full coverage. Nearly every state requires drivers to have liability insurance. Full coverage includes liability and extends the coverage to include collision and comprehensive. Here’s how each type of coverage works.
Used-car insurance grace period
Most insurers offer a grace period of up to 30 days if you already have an active car insurance policy. The grace period can help ensure you have coverage while adding a new vehicle to your policy if you’re buying a used car. Check with your insurance company to confirm how long the grace period lasts.
You don’t have a grace period if you don’t have an active insurance policy. It’s illegal to drive without car insurance coverage in nearly every state. Set up coverage before buying a used car to ensure that you follow the law and protect your finances.
Do you need full coverage on a used car?
Adding comprehensive and collision insurance when you have a used car only sometimes makes financial sense. The value of your vehicle can help you determine whether to move forward with a full-coverage policy.
You might opt for full coverage in the following situations:
You have a car loan. Lenders often require full-coverage insurance as additional protection for the loan. You may not have a choice if you have a car loan for your used car.3
Your car is worth at least 10 times the insurance premium. According to insurance experts, you can compare the worth of your vehicle to 10 times your insurance premium to determine if you need full coverage. For example, imagine your insurance premium is $1,600 per year ($1,600 x 10 = $16,000), and your car is worth $30,000. In that case, your vehicle is worth enough to justify the expense of full-coverage insurance.
You might want to skip a full-coverage policy if the following scenarios apply to you and your vehicle:
Your deductible is nearly the same as your car’s value. Full-coverage car insurance helps ensure you can pay for repairs to your vehicle if it’s damaged. But if your deductible is nearly the same as the value of your car, it might not be worth paying for repairs.
You expect to replace your car soon. It might not make sense to pay for additional coverage to protect your vehicle if it isn’t worth much and you plan to replace it soon.
Do you need gap coverage on a used car?
No, you don’t need it, but you may want it. You might have an auto loan balance that’s more than your car is worth. If your vehicle is totaled, gap insurance helps pay the difference between what your car is worth and how much you owe.
For example, imagine you have $30,000 left on a car loan. Your car was totaled in an accident, and the appraiser determined that your vehicle is worth $20,000. After you use $20,000 from your insurer to pay off your car loan, you still owe $10,000. If you have gap insurance, this helps cover the remaining $10,000.
Used-car insurance FAQs
Below, you’ll find answers to some of the most commonly asked questions about used-car insurance.
Can you drive a used car off the lot without insurance?
No. You can’t drive a used car off the lot without insurance. You must have car insurance to drive. Each state determines the type and amount of coverage. If you already have an active policy, your insurer might give you a grace period of two to 30 days to add your used car to the policy.
Do you need insurance to buy a used car?
Yes. You need insurance before you drive a used car. If you purchase from a dealership, you must show proof of insurance or buy temporary insurance before leaving. You might be able to purchase a used car without proof of insurance from a private seller, but it’s illegal to drive without it.
Is it cheaper to insure a used car?
Not necessarily. The price to insure a used car in comparison to a new car may differ in some instances, though it’s usually close. Other factors typically have a bigger effect on the cost, like your age, location, credit history, and driving record.
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