Cheapest Car Insurance Companies of 2019
Saturday, November 9, 2019
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There’s just no way around it: Car insurance is something you need. Your state car insurance regulations probably require you to have some sort of insurance coverage, your car financing or leasing company probably requires coverage, and let’s face it, you probably don’t want to have to come up with thousands of dollars for vehicle repairs, property repairs, or medical costs in the event of an accident.
In brief, you buy a car insurance policy from an auto insurance company. You pay them annual premiums, and if you have an accident, you make a claim that covers your financial losses that occurred because of the accident. Read How Car Insurance Works and How Much Car Insurance Do I Need? for more information.
Getting a good deal on car insurance is all about finding the balance between the coverage you want and annual premiums that fit your budget. We found the cheapest car insurance companies to help you find the right car insurance company for your budget.
Cheapest Car Insurance Companies
- USAA is the cheapest car insurance company on our list, with a study rate of $895. USAA presents the cheapest auto insurance study rates for various demographic profiles used in our study, ranging from 25-year-old men to 60-year-old women.
- Geico is the second-cheapest auto insurance company based on a study rate of $1,063. Geico’s representative rates for our 25-year-old driver profiles in our study are significantly lower than much of the competition, as are their study rates for driver profiles with one accident on their record.
- Travelers comes in third in our ranking of the cheapest car insurance companies, with a representative rate of $1,212. For most of our driver profiles, Travelers stays firmly as the third-cheapest option, though in a few instances, it drops to fourth behind State Farm.
- State Farm is the four-cheapest car insurance company in our analysis, with a study rate of $1,260. That’s well below the average among the nine major car insurance companies on our list.
- Progressive's car insurance representative rates are the fifth lowest of the companies on this list and come to $1,308 per year based on the driver profiles used in the study. Progressive’s rates in our study for some profiles, such as the 60-year-olds, are quite competitive.
- American Family has the sixth-cheapest car insurance rates in our study, at $1,326 per year based on the driver profiles we used. Notably, American Family's representative rate is the first one to be higher than the national average of $1,323 – though not by much.
- Nationwide is the seventh-cheapest car insurance company, according to our analysis. There's quite a jump in the study rates between American Family and Nationwide (about $200), with this company's study rate clocking in at $1,530. Though it’s more expensive than most rivals overall, we found that Nationwide charges among the cheapest study rates for driver profiles with poor credit.
- Farmers car insurance rates in our analysis are quite a bit above average, at $1,538. That makes Farmers the second-most expensive insurance company, according to our study.
- Allstate had rates in our study coming to $1,778 per year based on our driver profiles. That's about $450 higher than the national average rate in our analysis, and almost $900 higher than the representative rates from the cheapest company in our study, USAA.
It's important to note that not all of these companies are available nationwide. In fact, only USAA, Geico, State Farm, and Allstate are available in all 50 states and the District of Columbia. American Family and Travelers are only available in 19 and 24 states, respectively. Farmers is available in 31 states, Nationwide is available in 43, and Progressive in 48.
How We Found the Cheapest Car Insurance Companies
At U.S. News, we’re all about helping people make life’s important decisions. Our college rankings, launched in 1983, set the standard in educational rankings. Our ranking in other fields, like healthcare, civic areas, and the automotive sphere, help people and thought leaders make choices that make lives better. Now we’re continuing to empower you with the information you need to make the right choices for your life with our Cheapest Car Insurance Rankings.
Our Study Rates
For this study, U.S. News worked with Quadrant Information Services to provide a report of average insurance rates in all 50 states from the 10 largest national car insurance companies. Quadrant obtained rate data provided by car insurers to state regulators, based on profiles for both male and female drivers aged 25, 35, and 60. Vehicles used include the 2015 Honda Civic, 2015 Toyota RAV4, and 2015 Ford-F-150, with annual mileage of 6,000 and 12,000. Three car insurance coverage levels were used, as were credit tiers of good, fair, and poor. Clean driving records and records with one accident, one speeding violation, and one DUI were also used in the calculations.
To get the study rates shown here, we computed a simple average of all driver profiles and profile combinations for a given company or risk pool. The rates shown here are for comparative purposes only and should not be considered “average” rates available by individual insurers. Individual rates will differ.
How Much Is Car Insurance?
Car insurance rates vary depending on your situation, but the average annual representative rate from the nine companies in our study was $1,323. We got this rate by creating baseline driver profiles for all the insurers. These profiles covered men and women aged 25, 35, and 60 years old, with a good credit score, a clean driving record, a medium level of insurance coverage, and 12,000 miles of driving each year. The vehicles used include the 2015 Honda Civic, 2015 Toyota RAV4, and 2015 Ford-F-150.
Though the average study rate for all the baseline driver profiles and all the companies in our study was $1,323, driver profiles with different ages will pay different rates. The average annual rate for 25-year-old driver profiles in our study was $1,508 per year – that’s $185 more than the average for the baseline driver profiles. On the other hand, the 60-year-old married driver profiles in our study had an average annual representative rate of $1,171, which is $152 less than the average for the baseline driver profiles.
Your driving record influences your car insurance rates. In our study, driver profiles with a clean driving record have a simple average representative rate of $1,323 per year in car insurance premiums. Driver profiles with one speeding ticket have an average of $1,619, and driver profiles with one accident have a study rate of $1,927 based on the data and simple averages used in our study. Driver profiles with one DUI conviction in our study had a simple average rate $2,362 per year for car insurance. It pays to drive safely.
Credit scores also play a role in your car insurance rates. According to the data, driver profiles with good credit scores have a simple average representative rate of $1,306 per year for car insurance, while having a fair credit score drives the study rate up to $1,557. Driver profiles with poor credit scores have annual car insurance representative rates of $2,318 based on the data and methods of our study.
The kind of car insurance coverage you choose affects your rates as well. Driver profiles with bare-bones, low car insurance coverage saw study rates of $1,249 per year on average, while driver profiles with medium coverage had study rates of $1,323. Driver profiles with high coverage had study rates $1,387 on average. While it may be tempting to save some money on your car insurance premiums by opting for lower coverage, not having enough coverage for your situation can be a costly mistake if you have to make a claim. Read How Much Car Insurance Do I Need? to find the right car insurance coverage for your situation
Your driving record influences your car insurance rates. In our study, driver profiles with a clean driving record have a simple average representative rate of $1,323 per year in car insurance premiums. Driver profiles with one speeding ticket have an average of $1,619, and driver profiles with one accident have a study rate of $1,927 based on the data and simple averages used in our study. Driver profiles with one DUI conviction in our study had a simple average rate $2,362 per year for car insurance. It pays to drive safely.
Credit scores also play a role in your car insurance rates. According to the data, driver profiles with good credit scores have a simple average representative rate of $1,306 per year for car insurance, while having a fair credit score drives the study rate up to $1,557. Driver profiles with poor credit scores have annual car insurance representative rates of $2,318 based on the data and methods of our study.
The kind of car insurance coverage you choose affects your rates as well. Driver profiles with bare-bones, low car insurance coverage saw study rates of $1,249 per year on average, while driver profiles with medium coverage had study rates of $1,323. Driver profiles with high coverage had study rates $1,387 on average. While it may be tempting to save some money on your car insurance premiums by opting for lower coverage, not having enough coverage for your situation can be a costly mistake if you have to make a claim. Read How Much Car Insurance Do I Need? to find the right car insurance coverage for your situation
If you want the cheapest car insurance coverage, you can choose to only get the bare minimum insurance coverage required by law. If you lease or finance your car, your leasing company or lender may also require that you have certain types of coverage. Beyond those minimums, however, the amount of insurance coverage you get is up to you, and it’s tempting to save on monthly premiums by skimping on insurance coverage.
Company
|
Low Coverage
|
Medium Coverage
|
High Coverage
|
Allstate
|
$1,678.31
|
$1,777.66
|
$1,876.14
|
American Family
|
$1,252.04
|
$1,325.99
|
$1,297.59
|
Farmers
|
$1,456.07
|
$1,538.21
|
$1,627.44
|
Geico
|
$984.70
|
$1,063.10
|
$1,146.20
|
Nationwide
|
$1,494.22
|
$1,529.58
|
$1,573.98
|
Progressive
|
$1,222.50
|
$1,308.37
|
$1,411.31
|
State Farm
|
$1,166.65
|
$1,260.12
|
$1,352.67
|
Travelers
|
$1,144.59
|
$1,211.84
|
$1,254.59
|
USAA
|
$842.63
|
$894.95
|
$946.02
|
However, before you go for the least amount of car insurance you can get away with, know that opting for low insurance coverage may not save you that much. According to our data, driver profiles with low insurance premiums had a study rate of $1,249 per year. Medium coverage profiles had a study rate of $1,323, and high coverage profiles had study rates of $1,387. Based on this data, going for low coverage instead of high coverage only saves $138 per year on average.
Saving nearly $150 a year is nothing to sneeze at, especially if you’re on a tight budget. With the potential costs of a car accident, however, that short-term savings can cost you quite a bit if you have an accident. Say, for example, you get a low coverage policy that only offers $15,000 in coverage for medical costs, and you’re at fault for an accident that injures someone and results in $30,000 worth of medical bills. Once your insurance pays out the $15,000, you can be sued for the rest of the money. That can result in the loss of assets, like your house or savings. When choosing insurance coverage, think about the assets you’ll want to protect in the event of an accident, not just your monthly premiums.
Most major insurers offer car insurance coverage in three general tiers: low, medium, and high (even if they don’t necessarily advertise it as such). We created identical profiles in our study to represent drivers, then found out how rates changed with the three levels of coverage. The profiles were assigned a clean driving record, a good credit score, and 12,000 miles of annual driving. We used both males and females with the ages of 25, 35, and 60. The 2015 Honda Civic, 2015 Toyota RAV4, and 2015 Ford F-150 are the vehicles used in our analysis.
Why Does Car Insurance Cost So Much?
Car insurance costs so much because car accidents cost so much. The National Highway Traffic Safety Administration reports that in 2010, the most recent year with available data, motor vehicle crashes in the U.S. cost the economy $242 billion in lost productivity, health care costs, emergency services, legal costs, and property damages. A good chunk of those costs is paid for by insurance companies. To stay in business, insurers need to take in more in premiums than they pay out in claims. That’s how car insurance works.
Car insurance companies set their rates based on a number of factors that basically boil down to how likely they think you are to make a claim. The ideal customer for a car insurance company is an experienced, safe driver who lives in an area with little congestion, crime, or risk of natural disaster, who drives a car that’s inexpensive to fix, and who doesn’t drive all that much. That customer is likely to pay premiums for years without ever having an expensive claim, and the insurance company will make a profit.
Because where you live can affect your risk of an accident, it’s something car insurance companies consider when calculating your rates. If you live in an area with a lot of crime and traffic, you can expect to pay more for insurance. Also, different states have different requirements for car insurance, which can drive up costs. Check out the guide to the cheapest car insurance for your state to learn more.
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