The best way to know what the cheapest car insurance rates are is by comparing the different companies that offer them. This will help you decide better, and eventually get the best deal possible.
Are you planning to buy a new car? Have you decided what model and brand to go for?
While choosing the car that you are purchasing can already get a little overwhelming with so many options in the market, choosing the best car insurance, needless to say, the one that offers the cheapest car insurance rates, can also give you a hard time.
Like buying a car, choosing a car insurance company can get tricky, too, with so many options around. Thus the question, what’s the best and the cheapest rates for car insurance in the market today?
Getting car insurance is a prerequisite when buying a car. It is actually required by the law. More so, having car insurance will help keep your worries away should anything unexpected happens.
But the thing is, car insurance, just like any other insurance comes with a price — and it can be really expensive especially if the owner is young.
Important fact — according to Statista, back in 2016, there were more than “268 million registered vehicles on the roads in the United States”. That’s a lot! And the number continues to grow year after year.
Meanwhile, insurance-wise, back in 2018, “the average cost of car insurance for 19-year-old males was around 2,154 U.S. dollars and for 19-year-old females, it was around 1,930 U.S. dollars”. Note that the price of the insurance eventually drops as the person or the owner gets older.
In addition to these facts, according to a report by the Business Insider, “the average cost for car insurance between 2017 and 2019 was $1,566 per year”. Again, take note that the cost depends from one person to another — and that the major factor affecting the cost is the owner’s age. Apart from that, other factors affecting the cost are “state you live in, the level of coverage you’d like to have, and your gender, age, credit history, and driving history”.
If you are a newbie in buying a car and dealing with car insurance, this may cause you some headaches. Thus, we are going to share with you some very relevant information about getting car insurance, and most importantly, we are going to compare insurance costs from companies that offer the cheapest car insurance rates.
IMPORTANCE OF CAR INSURANCE
Before we talk about the different companies that offer the cheapest car insurance rates, it is important that you understand, first and foremost the importance of getting car insurance.
According to Statista, “Auto insurance is important because it not only covers any physical damage that may occur in an accident but also any damage or injury that might be caused because of a vehicular accident or which may be done upon oneself or one’s vehicle by another vehicle or accident – a falling tree for example.”
But more to that, in the United States (and even in other countries as well) having a car or auto insurance is a legal requirement, as stipulated in the Road Traffic Act 1988, which means it’s not optional. When you buy a car, automatically, it has to insure.
While having a car is gives a sense of convenience when it comes to going places, we cannot deny the fact that accidents can happen. In fact, driving a car makes us prone to accidents. Thus, the need for car insurance.
But apart from accidents, insurance can also provide the owner financial support during unfortunate cases like the car being vandalized, destroyed by fire or even when stolen.
It is worth sharing though that there are instances when you do not need insurance for your vehicle. However, this is only applicable if you have declared your car off the road through what they call as a Statutory Off Road Notification (SORN) from the DVLA.
Now, what happens if the car is not insured?
The answer is very simple — that means you are driving the car illegally. If proven that you are driving a car without car insurance, you could either be fined or be disqualified from driving.
The maximum fine for driving without car insurance is unlimited. Apart from that, you will receive six to eight penalty points on your license. More so, the authorities such as the police are given the power to either seize or destroy any vehicle being driven without insurance coverage.
Apart from knowing the companies that offer the cheapest car insurance rates, you may also be interested in knowing some ways to have cheaper car insurance. If so, we recommend you check this video by Kevin Hunter. We find it very insightful and really helpful especially if you want to keep a few bucks from insurances.
TYPES OF CAR INSURANCE
It is also important that you are aware of or that you fully understand that there are different types of car insurance policies. In fact, there are three levels of cover that you can choose from, and these are as follows:
Third-Party – This refers to the minimum car insurance coverage that is required by the law. However, this does not mean this is always the cheapest. The third-party level covers injuries to other people, as well as damage to other people’s property.
Third-Party, Fire, and Theft – This is basically the same as the third party insurance coverage, but with additional inclusions or coverage. This also covers the cost of repairs or a replacement of vehicles should the car be stolen or damaged by fire. For us, this is what we highly recommend. It’s pretty basic but covers the usual concerns of car owners.
Comprehensive – This type of car insurance policy is the highest form that you can get. It covers damage to your own car, as well as accidents that involve other people. This policy may also include a courtesy car, as well as legal expenses insurance. But, expect it to be a little pricey as compared to the first two types.
When getting insurance, you also have to be aware that the insurer may also allow you to add the driver’s name to your policy. Just take note though that the main driver has to be the one who drives the car frequently.
CAR INSURANCE COSTING
When it comes to the cost of your car insurance, basically, your premium will be based on a couple of factors like your age, the type of car that you can drive, where you live, your work or occupation, where you keep your car, the purpose of driving a car, and if you have been involved or convicted because of any motoring offenses.
Usually, premiums can be lowered by paying a higher excess. This refers to the amount you have to contribute to any claim you make.
As we have mentioned earlier, young people face high premiums as compared to older ones. This is because insurers believe they are the ones with greater or higher risk.
COMPANIES WITH CHEAPEST CAR INSURANCE RATES
There are so many insurance providers in the country, and in fact, they vary from one state to another. Thus, you may also consider checking the companies that offer the cheapest car insurance rates based on where you live.
Meanwhile, for this list, we are going to share with you the common names that come out whenever people look for companies that offer the cheapest car insurance rates – regardless of state. I hope this helps you as you decide on where to get your car insurance premiums.
Let’s begin with –
Geico has by far the cheapest car insurance that is available across 19 out of 50 states in the country. In fact, whenever people talk about the companies that offer the cheapest car insurance rates, Geico is always the first company that comes to mind.
To give you an idea, for good drivers, Geico has an average annual rate of $1,198 per year according to the analysis made by NerdWallet. Apart from that, the company has also been found as the cheapest insurer for drivers. In fact, they have a recent at-fault accident at an average rate of $1,888 annually. Meanwhile, drivers with bad credit have an annual rate of $1,748. The company’s minimum coverage insurance is $478 per year.
Geico is one of the most consistent affordable options there is. More so, we also like the fact that the company has innovative tools and features like mobile payment, which makes life easier for car owners. They also have good customer service, which is a plus. It means, they do not compromise their service just because they offer affordable premiums.
Progressive is another company that offers cheap car insurance premiums. However, it has been found to be the cheapest option for seven states only. Nevertheless, if you are living in those areas or locations, you can definitely take advantage of this.
Now, based on NerdWallet’s analysis, Progressive comes third among the cheapest. It has an average rate of $1,766 per year for good drivers. As for those with an at-fault accident, they offer $2,980 annually. Meanwhile, for owners with poor credit, they have an annual average rate of $3,238.
State Farm is also another good option when looking at the cheapest car insurance rates. They are fairly competitive when it comes to their premiums.
Based on the analysis made by NerdWallet, State Farm offers an average annual rate of $1.511 for good drivers. As with drivers with a recent at-fault crash or accident, the company offers an average annual rate of $1,968.
It is worth sharing also that State Farm has the best tools among any other car insurance providers in the country. Apart from mobile pay, they also offer mobile claim filing, as well as a pay-by-bank account option, which is an absolute convenience to any premium holders.
Erie Insurance is only available in northeast states, as well as some Midwest states. The company has a reputation for having low prices when it comes to car insurance policies, and also for offering good service.
Annually, Erie Insurance has an average cost of car insurance coverage for a normal adult driver at $894, which is definitely low compared to the previous ones.
For those interested, Erie Insurance is specifically offered in the following states: Washington DC, Illinois, Indiana, Kentucky, Maryland, Virginia, North Carolina, Ohio, Pennsylvania, Tennessee, West Virginia, and Wisconsin.
Liberty Mutual is known as an American diversified global insurer. It also is the third-largest property as well as a casualty insurer in the country.
With such a reputation, you will surely not go wrong dealing with the company. As of this writing, Liberty Mutual offers an annual average rate of $1,778 for good drivers. Meanwhile, for drivers with bad credit, the company has an average rate of $2,497 annually.
USAA is a specialized firm. We say specialized because it exclusively offers car insurance premiums for military families.
So, if you belong to such a family, we have to say, this is the best insurer to get yourself into. For typical drivers, they have an average rate of $960 per year. It is definitely cheap compared to other car insurance companies.
By the way, they cater to both active and retired or former military members, which include their spouses and children.
ALL-STATE INSURANCE COMPANY
Allstate Insurance Company has been one of the trusted names when it comes to car insurance. More so, one of the companies that offer cheap car insurance premiums. Allstate has been around since 1931, and it continues to serve car owners today by giving them the cheapest car insurance options.
Based on the analysis made by NerdWallet, it has been found that the company offers an average annual rate of $1,834 for good drivers. As for those with a recent at-fault accident, they offer an average rate of $2,904 per year, which is definitely competitive among other large insurance companies.
Apart from automobiles, Farmers also provides insurance premiums for homes and small business. In addition, this American insurance company also provides other insurance and financial services products.
Of all the insurance companies we have already mentioned, Farmers are definitely not the cheapest. For good drivers who opt for full coverage, the company offers an average rate of $1,865 per year. Meanwhile, their minimum coverage is at $926 per year, which is still not the cheapest if we are going to base it on our list. However, basing it on a larger scale, it still lands as one of the companies that offer the cheapest car insurance rates.
NATIONWIDE MUTUAL INSURANCE COMPANY
Nationwide Mutual Insurance Company is one of the largest financial and insurance providers not just in the US but all over the world. The company focuses on casualty and domestic property insurance, life insurance, retirement savings, as well as asset management, and strategic investments.
When it comes to senior drivers or adult drivers, Nationwide Mutual Insurance Company is considered having one of the cheapest car insurance rates. For single adults aged 60 years old and above, they have an average cost of coverage at $1,042 every year. So, yeah, for older drivers, this is definitely the best company to get your car insurance from.
THE TRAVELERS COMPANIES, INC.
The Travelers Companies, Inc. or more popularly known as Travelers is the second-largest writer of commercial property-casualty insurance in the United States. It is also considered as the third-largest when it comes to personal insurance.
Travelers are one of the cheapest options when it comes to car insurance. At an average, you can get car insurance at $1,212 per year. Travelers have been one of the best choices for most drivers looking for cheapest yet great car insurance rates.
AMERICAN FAMILY INSURANCE
American Family Insurance or also known as AmFam is a private mutual company. The company specifically focuses on providing insurance for property, casualty, as well as commercial. Of course, they are also a popular name when it comes to auto or car insurance being one of the cheapest.
At an average rate of $1,326 per year, you get to have car insurance coverage. Definitely among the cheapest car insurance rates in the country. Needless to say, it is a reputable company that has been around for quite some time already.
TIPS IN GETTING CHEAPER CAR INSURANCE
Before we end, we just want to say that there are a lot of ways for you to get a lower or cheaper car insurance cost. First, you can “window shop” for car insurance among the different insurance companies out there or you can simply check reviews online like what we have here. This helps you decide as to what company to choose. Second, you may opt for a higher deductible. By doing so, it will help lower your monthly rates.
Third, you may also take advantage of discounts, which is common when you are bundling your policies or when you are insuring multiple vehicles. Lastly, do not forget about your credit score. You will earn a good credit score by paying your bills on time, and by keeping your credit card balances low. This will eventually be translated to cheaper insurance rates.
FINAL THOUGHTS ON CHEAPEST CAR INSURANCE RATES
You see, apart from deciding what type of vehicle or car you are buying, make sure that you also shop for car insurance so that once you have decided what unit or model of car to get, you already know where to get insurance from.
It’s nice knowing also that you have a lot of options when it comes to companies providing the cheapest car insurance rates.
So, have you decided yet?