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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.
Quick Facts
Car insurance companies don’t use your income to calculate insurance rates.[1]
California, Hawaii, Maryland, and New Jersey have low-income car insurance initiatives.
Comparing quotes can help you get the cheapest insurance rates on the coverage you need.
Cheapest car insurance companies for low-income drivers
COUNTRY Financial, NJM, and Auto-Owners 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.
The below rates are estimated rates current as of: Friday, May 3 at 12:00 PM PDT.
Insurance Company
Average Quote: Liability Only
COUNTRY Financial
20
NJM
35
Auto-Owners
38
USAA
45
Hugo
49
State Farm
53
GEICO
54
Erie
56
Mile Auto
59
Allstate
62
Safeco
70
American Family
76
Metromile
76
National General
77
Progressive
80
Mercury
84
Dairyland
84
Nationwide
84
Root
87
CSAA
88
Clearcover
88
Travelers
89
State Auto
97
Direct Auto
98
Liberty Mutual
98
Elephant
99
Anchor
104
Shelter
109
Farmers
110
The Hartford
114
The General
114
Chubb
115
Commonwealth Casualty
118
AssuranceAmerica
121
21st Century
121
GAINSCO
122
Bristol West
129
Foremost
137
Amica
174
Infinity
198
Disclaimer: Table data sourced from real-time quotes from Insurify's 50-plus partner insurance providers and quote estimates from Quadrant Information Services. Actual quotes may vary based on the policy buyer's unique driver profile.
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.
Good to Know
It’s worth noting that state programs may offer only enough coverage to meet your state’s minimum car insurance requirement. While state-minimum coverage is more affordable, it may not be enough to fully protect you and your vehicle on the road.
California
California’s Low Cost Auto (CLCA) Insurance Programhelps low-income people meet the state’s liability insurance requirement at lower rates. Additional coverage options, such as uninsured bodily injury and medical payments coverage, are also available at an extra cost.
You and any secondary drivers must meet the following requirements to qualify for California’s car insurance assistance program:[2]
Have a valid California license
Be 16 or older (applicants younger than 18 must be legally emancipated)
Own a vehicle valued at $25,000 or less
Have a clean driving record or be a new driver
Earn less than the annual household income limit
When you’re ready to apply or if you have further questions, call the customer support line at 1 (866) 602-8861 or find an insurance agent near you.
Hawaii
The Hawaii Department of Human Services (DHS) offers free no-fault insurance to drivers who receive financial assistance. To qualify, low-income residents must show proof of payment from the following programs:
Temporary Assistance to Needy Families with Dependent Children
General Assistance Program
Aid to the Aged, Blind, or Disabled
Supplemental Security Income under the Social Security Administration
Additionally, each policyholder must own the insured vehicle and have a valid Hawaii driver’s license (unless permanently disabled or unable to operate their own vehicle).[3]
Contact the public assistance information line at 1 (855) 643-1643 for more information, or reach out to one of the DHS processing centers.
Maryland
The Maryland Auto Insurance program caters to high-risk drivers whose policies have been turned down or canceled by other car insurance companies. While established by the state of Maryland, the organization is independently funded through premium payments and its investment portfolio.
Maryland Auto Insurance provides state-mandated coverages, which include liability insurance, uninsured motorist, and personal injury protection (PIP) coverage. You can also upgrade your policy with collision, comprehensive, rental car reimbursement, and towing coverage.
Drivers must fulfill the following requirements to be eligible for this program:[4]
Be a Maryland resident
Own an automobile registered in Maryland or have a valid Maryland driver’s license
Had their policy canceled or denied by two or more insurers
Not owe Maryland any unpaid premium
When you’re ready to apply, obtain a quote on the company’s website, call 1 (808) 492-7120, or fill out the online form. If you prefer to work with an insurance agent, use the agent locator tool to find an agent near you.
New Jersey
New Jersey’s Special Automobile Insurance Policy (SAIP) medical-only car coverage helps low-income drivers meet state insurance requirements. This policy covers your medical expenses, such as emergency treatments and treatments for severe brain and spinal cord injuries. It also provides a death benefit.
To qualify for coverage, applicants must satisfy the following criteria:[5]
Be enrolled in federal Medicaid with a hospitalization benefit
Own a valid driver’s license or registration in New Jersey
New Jersey’s “dollar-per-day” insurance costs $360 per year if paid in full or $365 if paid in two installments. To obtain coverage, find a Personal Automobile Insurance Plan (PAIP) producer in your area or call 1 (800) 652-2471.
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.
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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.
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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.
Vehicle
Average Monthly Quote
Chrysler Town & Country
$153
Honda Odyssey
$159
Subaru Forester
$160
Toyota Sienna
$169
Subaru Outback
$170
Honda CR-V
$173
Buick Enclave
$173
Ford Ranger
$174
Subaru Legacy
$175
Chevrolet Trailblazer
$177
Disclaimer: Table data sourced from real-time quotes from Insurify's 50-plus partner insurance providers. Actual quotes may vary based on the policy buyer's unique driver profile.
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, NJM, and Auto-Owners 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.
Methodology
Insurify data scientists analyzed more than 90 million quotes served to car insurance applicants in Insurify’s proprietary database to calculate the premium averages displayed on this page. These premiums are real quotes that come directly from Insurify’s 50+ partner insurance companies in all 50 states and Washington, D.C. Quote averages represent the median price for a quote across the given coverage level, driver subset, and geographic area.
Unless otherwise specified, quoted rates reflect the average cost for drivers between 20 and 70 years old with a clean driving record and average or better credit (a credit score of 600 or higher).
Liability-only premium averages correspond to policies with the following coverage limits:
Bodily injury limits between state-minimum rates and $50,000 per person, $100,000 per accident
Property damage limits between $10,000 and $50,000
No additional coverage
Full-coverage premium averages correspond to the same bodily injury and property damage limits in addition to:
Comprehensive coverage with a $1,000 deductible
Collision coverage with a $1,000 deductible
Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Services’ database of auto insurance rates.
Alani Asis is a personal finance freelance writer with nearly three years of experience in content creation. She has landed bylines with leading publications and brands like Insider, Fortune, LendingTree, and more. Alani aims to make personal finance approachable through fun, relatable, and digestible content.
5+ years in insurance and personal finance content
Ashley is a seasoned personal finance editor who’s produced a variety of digital content, including insurance, credit cards, mortgages, and consumer lending products.