Best Auto Insurance for Low-Income Drivers in 2024 (Our Top 10 Picks)

If there are no programs in your state for cheap auto insurance, take action to reduce your rates. Discover low-income auto insurance options and top ways to cut rates by entering your ZIP code above.

#1 – State Farm: Top Pick Overall

Pros 

• Affordable rates suitable for low-income individuals: State Farm’s pricing structure is designed to be accessible for drivers on a budget. You can learn more about State Farm’s budget-friendly rates in our State Farm auto insurance review.
• State Farm Drive Safe & Save discounts for safe driving behavior: This program allows low-income drivers to further reduce costs by demonstrating safe driving habits.
• Convenient online tools and resources: State Farm provides online tools for easy policy management, enhancing accessibility for low-income individuals.

Cons

• Rates may vary based on location: Depending on the geographical area, rates might differ, potentially impacting affordability for some individuals.
• Limited online quote options: Which may be less convenient for low-income individuals seeking quick and accessible information.

#2 – Geico: Best for Low-Mileage Discount

Pros

• Affordable rates, catering to budget-conscious drivers: Geico is known for its competitive pricing, making it a suitable option for those with limited financial resources.
• Low-mileage discount for infrequent drivers: This discount acknowledges the reduced risk associated with low-mileage driving, resulting in additional savings. You can learn more about Geico’s low-mileage discount in our Geico auto insurance review. 
• 24/7 customer service: Geico ensures around-the-clock customer support for any inquiries or assistance, benefiting low-income drivers.

Cons

• Customer service experiences can vary: While Geico offers affordability, the quality of customer service may fluctuate.
• Limited local agents: Which may reduce the personal touch that some low-income individuals prefer.

#3 – Progressive: Best Discount Options

Pros

• Flexibility in pricing with the Name Your Price tool: This tool allows low-income drivers to tailor their coverage within their budget constraints. You can learn more about Progressive’s Name Your Price tool in our Progressive auto insurance review. 
• Diverse coverage options to meet specific needs: Progressive provides a range of coverage options, allowing customization based on individual requirements.
• Variety of discounts available: Progressive offers various discounts for additional savings, catering to budget-conscious individuals.

Cons

• Rates may increase after an accident: While Progressive offers flexibility, post-accident rate increases can impact the overall affordability.
• Customer service reviews are mixed: Potentially affecting the overall experience for low-income drivers.

#4 – Allstate: Best for Deductible Rewards

Pros 

• Safe driving rewards program for potential deductible reductions: Low-income drivers can benefit from reduced deductibles by maintaining safe driving habits.
• Comprehensive coverage options to tailor to individual needs: Allstate provides various coverage options, allowing customization based on budget and preferences. You can learn more about Allstate’s coverage options in our Allstate auto insurance review. 
• User-friendly mobile app: Allstate’s easy-to-use mobile app provides convenience for low-income drivers managing their policies on the go.

Cons

• Higher premiums for certain coverage types: While offering comprehensive coverage, some policy types may come with higher premiums.
• Limited local agents: Which may affect the personalized assistance some low-income individuals prefer.

#5 – American Family: Best for Low-Income Assistance Programs 

Pros 

• Special programs for low-income drivers: American Family tailors its offerings to assist low-income individuals, ensuring affordability. You can read more in our American Family auto insurance review.
• Personalized service through local agents: The availability of local agents enhances the overall customer experience for low-income drivers.
• Online claim reporting and tracking: American Family offers online tools for easy claim reporting and tracking, providing convenience for low-income individuals.

Cons

• Limited availability in some regions: American Family may not be accessible in all areas, potentially limiting options for certain individuals.
• Mixed customer service reviews: The quality of customer service may vary, impacting the overall experience for low-income drivers.

#6 – Nationwide: Best for Vanishing Deductible Program

Pros 

• Vanishing Deductible option for potential cost savings: This program allows low-income drivers to gradually reduce their deductibles through safe driving practices. You can learn more about Nationwide’s vanishing deductible option in our Nationwide auto insurance review.
• Bundle discounts for additional savings: Combining policies can lead to further cost reductions for budget-conscious individuals.
• Strong financial ratings: Nationwide’s strong financial ratings provide confidence and security for low-income drivers.

Cons

• Rates may be higher for some drivers: While offering various discounts, Nationwide’s rates may still be higher for certain demographics.
• Limited local agents: May impact the level of personalized assistance low-income individuals prefer.

#7 – USAA: Best for Exclusive Benefits for Military Members

Pros 

• Specialized benefits and discounts for military personnel: Low-income military members can access exclusive discounts, enhancing overall affordability. You can learn more in our USAA auto insurance review. 
• Excellent customer service ratings: USAA is renowned for its exceptional customer service, providing support for low-income drivers.
• Digital tools for policy management: USAA offers digital tools for convenient policy management, benefiting low-income individuals.

Cons

• Only available to military members and their families: Limited eligibility may exclude non-military individuals seeking affordable coverage.
• Limited physical branches: May reduce in-person support for low-income drivers.

#8 – Liberty Mutual: Best for New Car Replacement Coverage

Pros

• New Car Replacement coverage for those with newer vehicles: This feature ensures that low-income drivers with newer cars receive adequate coverage and support. You can learn more in our Liberty Mutual auto insurance review.
• Multi-policy discounts available: Combining policies can lead to additional savings for budget-conscious individuals.
• Online quote process is straightforward: Liberty Mutual’s online quote process provides convenience for low-income individuals seeking quick quotes.

Cons

• Rates can be higher compared to some competitors: While offering comprehensive coverage, Liberty Mutual’s rates may be comparatively higher for certain individuals.
• Mixed customer service reviews: The quality of customer service may vary, impacting the overall experience for low-income drivers.

#9 – The Hartford: Best for AARP Partnership

Pros

• AARP members can access exclusive discounts: Low-income seniors can benefit from additional discounts through The Hartford’s partnership with AARP. You can learn more in our The Hartford auto insurance review. 
• Lifetime renewability for policies: Policies are renewable for a lifetime, providing long-term affordability and stability.
• Fast online claims process: The Hartford offers a fast online claims process, providing quick and efficient support for low-income seniors.

Cons

• Limited availability to AARP members: The Hartford’s exclusivity to AARP members may limit options for non-members.
• Rates may be higher for some drivers: Depending on individual factors, rates may be higher for certain low-income seniors.

#10 – Farmers: Best for Signal App

Pros 

• Signal app for potential discounts based on driving habits: Low-income drivers can utilize the Signal app to earn discounts through safe driving practices. You can learn more about the Signal app in our Farmers auto insurance review.
• Diverse coverage options for customization: Farmers provides various coverage options, allowing low-income drivers to tailor policies based on their specific needs.
• Educational resources for policyholders: Farmers offers educational resources to help low-income individuals understand and manage their insurance.

Cons

• Rates may be higher for certain demographics: While offering discounts, rates may still be higher for specific demographic groups.
• Mixed customer service reviews: The quality of customer service may vary, impacting the overall satisfaction for low-income drivers.

State-Sponsored Auto Insurance Programs for Low-Income Individuals 

A few states have government-sponsored programs regarding car insurance for low income individuals. Currently, only auto insurance in California, auto insurance in Hawaii, and auto insurance in New Jersey are offered by government assistance programs. We’ve outlined each state’s program for low-income car insurance below. 

California Low-Cost Automobile (CLCA) Insurance Program

According to California Low Cost Auto Insurance, to qualify for the CLCA program, drivers must meet income eligibility requirements and driving eligibility requirements. For income, drivers can’t make more than the following per household: 

• One-person household: $33,975
• Two-person household: $45,775
• Three-person household: $57,575
• Four-person household: $69,375

Drivers must also have a car worth less than $25,000, fewer than two personal cars registered in their name, and a good driving record in order to qualify for government auto insurance. Through the CLCA program, drivers can get the minimum liability auto insurance required by California, as well as uninsured motorist (UM) coverage and medical payments insurance coverage. 

Hawaii Low-Income Auto Insurance Program 

Low income car insurance Hawaii has less information readily available about its program, which can make it harder for drivers to find information about if they are eligible. Hawaii will provide free auto insurance to people with disabilities or who meet financial eligibility.

To qualify financially, households need to receive financial assistance payments from the government or supplemental security benefits. 

In addition, drivers must have exhausted all other options for paid insurance in Hawaii before they are deemed eligible for Hawaii’s free insurance program. As with California’s program, the vehicles must be owned and used for personal use, not for commercial use. 

New Jersey’s Special Automobile Insurance Policy (SAIP) 

New Jersey’s SAIP program is only for drivers who are enrolled in Medicaid and costs $1 a day. It is a bare minimum policy intended to help those who need help with car insurance payments. 

If you are in an accident, the SAIP coverage will cover up to $250,000 of emergency treatment and the costs of the brain and spinal cord injury. SAIP coverage will also give a $10,000 death benefit. 

However, SAIP won’t cover any of the damages or injuries that other parties might suffer or any damages to your own vehicle. Because SAIP doesn’t provide these basic bodily injury liability (BIL) auto insurance benefits or protection for your own car, we recommend getting SAIP as a last resort. 

Regular Auto Insurance Costs for Low-Income Drivers 

Unless you live in one of the three states with government assistance programs specifically for auto insurance, you will have to pay for auto insurance on your own. 

Instead, there are many factors that affect auto insurance rates such as your age, location, driving record, vehicle, and more to calculate your auto insurance rates. So even if you are struggling to pay for car insurance, you will still pay the same as a driver who has a similar driving record but a higher income.  

However, some states come with cheaper rates based on location and other factors. To get an idea of how much insurance rates vary by company, take a look at the table below. 

Low-Income Auto Insurance Monthly Rates

Purchasing just the minimum liability insurance in a state can cut your insurance costs in half. Living in one of the states with the cheapest auto insurance rates can also reduce your auto insurance costs. 

Read More: Which states have the cheapest auto insurance rates?

Auto Insurance Average Costs by Credit Score 

One major factor affecting what low-income drivers pay for their car insurance is their credit score. Poor credit scores and past debts indicate to insurance companies a higher likelihood of missed payments, making drivers with poor credit scores financially riskier to insure. 

To see just how much poor credit scores can impact rates, take a look at the table below. 

Full Coverage Auto Insurance Monthly Rates by Provider & Credit Score

Insurance Company	Good Credit	Fair Credit	Bad Credit
	$116	$136	$203
	$140	$160	$269
	$82	$99	$148
	$177	$226	$355
	$120	$133	$166
	$109	$138	$206
	$91	$117	$200
	$107	$128	$194
	$176	$197	$296
U.S. Average	$123	$148	$226

Geico has some of the cheapest auto insurance for low income families with poor credit scores, costing thousands of dollars less than the average rate at companies like Liberty Mutual. For more information, check out our Geico auto insurance review.

If you have a poor credit score, make sure to get quotes from the best auto insurance companies for drivers with bad credit to see if you can reduce your auto insurance rates. 

Other Ways Low-Income Drivers Can Find Auto Insurance Savings 

Besides state assistance programs that provide cheap auto insurance for low-income drivers, there are still plenty of ways to lower your auto insurance. From shopping around for quotes to applying for discounts, we’ve outlined our best tips to reduce car insurance rates below. 

Pay for Auto Insurance Monthly and With a Credit Card

Paying with a credit card for car insurance, rather than a direct deposit, means the money won’t be directly taken from your bank account. If you’re switching car insurance companies, this also means that you’ll receive your refund quickly.

You should also pay in monthly installments rather than a lump sum, as it is easier to afford small amounts each month than paying in full. Just bear in mind that insurance companies often charge slightly more for monthly payments. 

Shop for Auto Insurance Quotes and Save

For some drivers, switching auto insurance can save them hundreds of dollars every year. Shopping around for quotes periodically to compare rates can help you continue to find the best car insurance for low-income budgets. 

Read More: How To Switch Auto Insurance

We recommend getting quotes every year to make sure you are still getting the best deal possible. 

If you find a good deal but can’t currently afford it, most insurance companies will let you save your quote for a few months. This means that even if you purchase your policy a month later, you will still get the rates from your quote. 

Consider Pay-Per-Mile Auto Insurance 

Pay-per-mile insurance is a great option for drivers who drive less than 13,000 miles per year. Most pay-per-mile programs charge a daily set rate of a few dollars per day and an additional per-mile fee of a few cents. Read more about the best pay-as-you-go auto insurance companies.

So if you rarely drive, signing up with a pay-per-mile insurance policy could save you a significant amount of money on car insurance. 

Apply for Auto Insurance Discounts 

While some auto insurance discounts are automatically applied to your insurance policy, you may have to apply for some discounts. For example, some companies offer usage-based auto insurance discounts, which track your data for a few months and then issue a discount for safe driving. 

Insurance companies may also offer defensive driving auto insurance discounts if you complete an approved course and submit evidence of successful completion. 

Because these types of discounts aren’t automatic unless the driver takes action, check your insurance company’s full list of discounts to make sure there aren’t any additional discounts you can apply for. 

Buy an Inexpensive Car to Insure

Some cars are significantly cheaper to insure than others. It is best to purchase a car that has good safety features and cheap replacement parts. It will cost less to insure than an expensive car with costly, hard-to-find parts. 

You can get quotes for the cars you are thinking of buying to see how much they would cost to insure. 

Reduce Your Auto Insurance Coverages

If your car is older and not worth much, you can drop collision auto insurance and comprehensive auto insurance if the total annual cost of these coverages would equal 10% of your car’s total value. You can also choose to reduce your coverage by increasing your auto insurance deductible. 

Read More: Auto Insurance Deductibles Defined

Just make sure you don’t increase your deductible too much. The rule of thumb is not to raise your deductible beyond what you can pay out of pocket. Otherwise, you may be unable to afford to fix your car after an accident. 

Reduce Your Number of Owned Cars 

If you have multiple cars, consider cutting back on the number of cars you own. More cars mean higher insurance rates, so selling one car could reduce insurance rates substantially and make auto insurance for low-income individuals more affordable.

Why You Should Never Let Your Auto Insurance Lapse 

Drivers who are struggling to pay for car insurance may be tempted to let their car insurance lapse until they can afford payments again. This is a bad idea, as it comes with multiple financial repercussions if caught.

Considering hitting the road without insurance coverage?😱You might want to think twice! Driving without coverage is illegal in most states!🚨At https://t.co/27f1xf131D, we're here to break it down for you! Learn more here👉: https://t.co/4FYBp1e9AF pic.twitter.com/kIHGX8aOEQ

— AutoInsurance.org (@AutoInsurance) May 10, 2023

Not only will drivers face higher insurance rates for coverage lapses, but they also face fines, fees, and a suspended license. Instead of driving without insurance, follow the tips in the section above to reduce your low income auto insurance costs. 

Get Cheap Auto Insurance for Low-Income Drivers Today

There are a few states with programs for low income car insurance, but in all other states, drivers must work to reduce car insurance costs on their own. Shopping around for various types of auto insurance, applying for auto insurance discounts, improving credit scores, and comparing the cheapest auto insurance rates can help low-income drivers reduce their costs. 

To discover the most affordable car insurance options tailored for low-income individuals in your locality, enter your ZIP code below to compare rates from insurance providers specializing in serving those with limited financial means.