Best Cheap Car Insurance in 2016

If you find yourself wondering how to get car insurance on a budget, you aren’t alone. Many drivers look for cheap car insurance quotes just to find themselves more confused than ever. From full coverage car insurance to basic policies, car insurance companies offer a diverse selection of coverage options. In general, the more coverage you choose, the more money you can expect to pay. Before you start researching the cheapest car insurance, consider amount of coverage you need and the amount that you’re willing to pay.

From there, start by doing a car insurance comparison, which lets you choose the most competitive rates. In addition to the variation from company to company, prices also depend on your credit score, driving record and the state in which you live. Read on to learn more about the rates from the top car insurance companies and how to find the right cheap car insurance with the level of coverage that you need.

Best Car Insurance Rates from the Top 5 Companies

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Keeping premiums low is nice, but you also need to know that your insurance company can step up to the plate and defend you when you need it to. Before you jump into a cheap auto insurance policy with bare bones coverage, shop around and compare the rates from many different companies to get the policy with the most competitive price. Although you may be able to find better rates at a smaller insurance company, we chose to look at the top five companies available across the nation, including highly populated areas and lesser-populated locations.

Geico

In most areas of the country, Geico is synonymous with low cost insurance. Across the nation, premiums average $1,297 per year. In addition to its low prices, Geico also offers financial stability and strength you can depend on. It consistently earns superior ratings for its financial strength from A.M Best, Standard and Poor’s and Moody’s Investors Services. Kanbay Research Institute gives the insurance carrier top honors for its stellar customer service, speedy operations and fast turnaround of rate quotes.

When you’re looking for low cost insurance, this is a great place to start. You can get an online quote in minutes, but make sure you take advantage of any discounts for which you might qualify. Geico offers the lowest rates to customers who qualify for the company’s insurance reductions and discounts, which drive its already low prices down further. Some of the available discounts include:

  • Vehicle Equipment: Discounts between 1% and 40% for having equipment that enhances your vehicle’s safety, including driver-side or full-front seat airbags, anti-lock brakes, an anti-theft system and daytime running lights
  • Driving History and Habits: Drivers who make it a point to buckle up can take advantage of a 15% discount off the personal injury protection or medical payments coverage in their policy, while drivers who go accident-free for five years can save up to 26% on most of their coverage options
  • Driver’s Education: Completing an approved defensive driving course or driver’s education program can lower your premium. Full-time students with grades of “B” or better can earn up to 15% off some of their coverage options
  • Affiliations: Belonging to or working for certain groups and organizations qualifies you for an extra discount. Examples include military members who are deployed, on active duty or retired; members of the National Guard or Reserves and federal employees
  • Loyalty: Often called “bundling,” these discounts provide up to 25% off most coverage options if you have more than one vehicle insured with Geico or if you have several different types of policies, including auto with renters or homeowners insurance

State Farm

Although State Farm ranks as the second most affordable insurance company among the five big companies, the average annual premium runs around $2,296, which is significantly higher than Geico. No State Farm review would be complete without making mention first of this insurance company’s stellar customer service and longstanding history as a reputable insurance provider.

Even though its average premium cost runs higher than Geico’s does, State Farm also offers several ways to lower your costs. For example, you could opt for coverage that meets state-mandated minimums to save money compared to a full coverage policy, or you could opt for a higher deductible to save on the premium. What’s even better is that you can take advantage of the various discounts that State Farm offers as an easy way to save money on your coverage. Discount examples include:

  • Accident Free Discounts: Qualify after driving for three years or more without being in an accident
  • Anti-Theft: Install an anti-theft device or buy a car with an integrated system to qualify
  • Defensive Driving Course: Taking an approved course to enhance your safety skills can help you save on your car insurance bill
  • Drive Safe and Save: This program gives you a 5% discount for agreeing to install a device that reports your driving information to help save you money
  • Multiple Vehicles: Insure more than one vehicle with State Farm to save up to 20% on your bill
  • Multiple Lines: Bundling your car and homeowners, renters or other types of insurance can save you up to 22%

Progressive

Progressive shines with its superior online-only services that let drivers eliminate the need to receive any paper bills or statements or deal with agents. You can get a quote online, sign all policy documents electronically and qualify for discounts by signing up for auto and home insurance or multiple vehicle policies in addition to your car insurance. Annual premiums with Progressive average $2,821, which is more than twice the cost of Geico’s average.

AllState

AllState has the highest average annual rates for good drivers, coming in at $3,812, but the positive customer feedback and superior ratings from A.M Best make it worth a look. The AllState website makes it fast and easy to get car insurance quotes within minutes. Additionally, if you qualify for one of the available discounts, you can potentially save a lot of money every year. For example, AllState’s Drivewise program lets you earn up to 20% off your premiums in exchange for maintaining a safe driving record. Other discounts include:

  • Passive Restraint: Having factory-installed airbags and motorized seat belts could save you as much as 30% on your premium
  • Anti-theft Device: Having an installed anti-theft device can save you up to 10%
  • New Car: If you’re the first person to own a vehicle, AllState gives you a discount of up to 30%
  • EZ Pay Plan: Sign up for automatic payments to save up to 5%
  • eSmart: View your important documents online to save as much as 10%
  • Multiple Policy: Buy an auto policy in addition to homeowners or renters insurance to save up to 10%

USAA

Our USAA review reveals that this is a truly effective option for individuals with ties to the military. With annual premiums that average $918, USAA is also one of the cheapest options available. This insurance company offers a car buying service and auto loan in addition to its auto insurance, making it an easy and cost-effective one-stop shop. To be eligible, you need to qualify according to USAA’s criteria, which include being one of the following:

  • Active Military: A member of the Air Force, Navy, Army, Coast Guard or Marines
  • Former Military: An individual who separated or retired from the military with an honorable discharge
  • Family: Un-remarried former spouses, widows and widowers of USAA members or children whose parent had or have USAA property or auto insurance
  • Cadets and Midshipmen: Individuals enrolled at U.S. service academies, on ROTC scholarship, in advanced ROTC or within 24 months of commissioning

In addition to competitive pricing, USAA offers multiple discounts, including Safe Driver, Defensive Driving and Multi-vehicle discounts to save you even more. Other advantages include excellent customer service, integrated roadside assistance benefits and easy access by phone and computer or through the USAA app.

Small Local Car Insurance Brokers

In your quest for cheap car insurance, you shouldn’t count out the smaller players. While large companies have clout to back them up, many smaller insurance companies can offer lower prices as a means of remaining competitive. For example, if you’re looking for car insurance in Texas, get quotes from several larger, nationwide companies and also contact smaller companies such as:

  • Texas Fair Plan Association
  • ASI
  • Chubb
  • Amica
  • Cypress Texas

Similarly, if you need car insurance in Florida, you can start by getting quotes from some of the larger insurance companies. Then, take those quotes with you when you visit smaller companies such as Alabama-based Infinity Auto or United Automobile Insurance Company.

Best Companies by State

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Car insurance rates vary widely from state to state. An expensive policy in one state might cost hundreds of dollars less in another state. The main reasons for the difference include the percentage of uninsured drivers, state-mandated coverage amounts and the likelihood of a lawsuit in that state.

With that in mind, some of the priciest states for insurance include Michigan, with an average annual premium of $2,738, and Montana, which has an average annual premium of $2,297.

On the flip side, the cheapest states for car insurance include Ohio, which has an average annual premium of $900 and Maine, with its average annual premium of $808. Do you want to know more about the top auto insurance companies in your state? Find and click on your state below to see the top three companies near you.

Alabama

  • USAA
  • Allstate
  • Progressive

Alaska

  • USAA
  • Liberty Mutual
  • State Farm

Arizona

  • Auto-Owners Insurance
  • Farmers
  • State Farm

Arkansas

  • Farmers
  • Safeco
  • USAA

California

  • USAA
  • Amica Mutual
  • Sterling Casualty

Colorado

  • Grange
  • State Farm
  • American Family

Connecticut

  • Geico
  • Amica
  • MAPFRE Insurance

Delaware

  • Ameriprise
  • Allianz
  • 21st Century

District of Columbia

  • USAA
  • Geico
  • State Farm

Florida

  • Farm Bureau Insurance
  • USAA
  • Geico

Georgia

  • Geico
  • USAA
  • Auto-Owners Insurance

Hawaii

  • Allianz Auto Insurance
  • American Auto
  • Fireman’s Fund

Idaho

  • USAA
  • Oregon Mutual
  • Geico

Illinois

  • The Hartford
  • Farmers
  • SECURA

Indiana

  • Cincinnati Insurance
  • Erie
  • Farmers

Iowa

  • Partners Mutual
  • IMT
  • Western National

Kansas

  • USAA
  • Allied
  • State Farm

Kentucky

  • Farm Bureau
  • Cincinnati Insurance
  • Grange Mutual

Louisiana

  • Geico
  • Farm Bureau
  • State Farm

Maine

  • Geico
  • Concord
  • Patriot

Maryland

  • Geico
  • USAA
  • Selective Insurance

Massachusetts

  • Hanover
  • Safety
  • Concord

Michigan

  • Frankenmuth
  • Hanover
  • MEEMIC

Minnesota

  • Farm Bureau
  • State Farm
  • West Bend Mutual

Mississippi

  • Unitrin
  • Alfa
  • State Farm

Missouri

  • Farmers
  • Electric
  • American Family

Montana

  • USAA
  • State Farm
  • Geico

Nebraska

  • Farm Bureau
  • State Farm
  • Geico

Nevada

  • Allied
  • Oregon Mutual
  • Geico

New Hampshire

  • Geico
  • Patriot Insurance
  • State Farm

New Jersey

  • AAA
  • NJ Skylands
  • New Jersey Manufacturers

New Mexico

  • USAA
  • Geico
  • Farmers

New York

  • Geico
  • USAA
  • Erie

North Carolina

  • Geico
  • Auto-Owners
  • Farm Bureau

North Dakota

  • USAA
  • Allied
  • Nodak Mutual

Ohio

  • Motorists Mutual
  • Erie
  • Grange Mutual

Oklahoma

  • Geico
  • USAA
  • Oklahoma Farmers Union

Oregon

  • Geico
  • Oregon Mutual
  • USAA

Pennsylvania

  • Erie
  • Geico
  • Nationwide

Rhode Island

  • State Farm
  • USAA
  • Geico

South Carolina

  • Farm Bureau
  • State Auto
  • Grange Mutual

South Dakota

  • Western National Insurance
  • State Farm
  • Geico

Tennessee

  • Utica National
  • The Cincinnati
  • Geico

Texas

  • USAA
  • Allstate
  • Foremost

Utah

  • Bear River
  • Geico
  • Farm Bureau

Vermont

  • Geico
  • Co-operative Insurance
  • Unitrin

Virginia

  • USAA
  • Geico
  • State Farm

Washington

  • USAA
  • PEMCO
  • State Farm

West Virginia

  • Erie
  • Westfield
  • Grange

Wisconsin

  • USAA
  • Geico
  • Partners Mutual

Wyoming

  • State Farm
  • Geico
  • Grange

How We Rated the Best Auto Insurance Companies

To rate the best auto insurance companies, we looked at the insurers that provided a combination of affordable car insurance and excellent customer service. We consider affordable rates as those that fall well below the state average, and excellent customer service as service that’s fast and easy to access via a variety of methods, including by phone, online and with a mobile app.

After all, getting a cheap car insurance policy and saving money is great, but after an accident, you need an insurance company that can deliver quickly and without unnecessary hassle.

You can trust that we maintain strict editorial integrity in our writing and assessments; however, we receive compensation when you click on links to products from our partners and get approved.
Published August 17, 2016
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