Here are the cheapest car Insurance companies for 2021
According to our study the USAA is the cheapest car insurance company in 2021and Geico is the cheapest company open to the general public.
It’s often said nothing in life can be certain except death and taxes. If you own a car, you can add car insurance to that list. Almost every state has laws and regulations that require drivers to carry some form of auto insurance.
According to our study, USAA is the cheapest car insurance company in 2021, though it is limited to members with a military affiliation. Geico is the cheapest company open to the general public.
When you’re looking for a good deal on car insurance, you need to balance the level of coverage you need with rates that won’t empty your wallet. We did a thorough analysis of car insurance rates for drivers across the country to find the companies that offer the lowest rates in each state. Please be aware that the rates shown here are a simple average taken from representative driver profiles, so your rates may differ.
Cheapest Car Insurance Companies
- USAA is the cheapest car insurance company, and it offers the lowest car insurance rates in the country, according to our analysis. Our study shows an average rate of just $875 per year, which is a savings of about $225, or about 20%, compared to the next cheapest insurance company in our study. USAA has the lowest premiums for nearly every driver demographic we analyzed, and even when it wasn’t the absolute cheapest, it wasn’t much more expensive than its cheaper rival. That being said, USAA is only open to individuals with a connection to the military, so not everyone can access these cheap rates.
- Geico is the second-cheapest car insurance company, according to our analysis, with an annual rate of $1,099. That’s quite a bit more expensive than USAA’s rate, but it’s still around 17% cheaper than the national average ($1,320) in our analysis. Geico offers some of the lowest rates for nearly every driver demographic in our study, particularly when it comes to younger drivers.
- State Farm is the third-cheapest car insurance company in our study. With an annual rate of $1,168, State Farm is about 12% cheaper than the national average. According to our analysis, this insurer is a great option for people with less-than-stellar driving records. State Farm’s study rates are well below the national average for drivers with a speeding ticket or an accident and were the cheapest in our study for drivers with a DUI.
- Travelers are the fourth-cheapest car insurance company in our ranking of the cheapest insurers, with an average premium of $1,250. That’s a savings of about 5% compared to the national average. Of the drivers analyzed in our study, our analysis shows that rates from Travelers tend to be slightly below average, though there are a few exceptions to that rule.
- Nationwide is the fifth-cheapest car insurance company in our study, with an annual rate of $1,284. It’s the last company in our cheapest car insurance rankings with an average rate that is less than the national average, though the savings are only about 3%. Nationwide comes in below or near the average for most drivers in the study, though it’s one of the more expensive options for drivers with a DUI.
- Progressive is the sixth-cheapest car insurance company in our rankings. With a study rate of $1,334, it’s about 1% more expensive than the nationwide average. For most of the driver profiles in our study, Progressive’s rates are pretty close to average. However, Progressive is notably above average for 25-year-old drivers and drivers with one accident, and, on the flip side, is one of the cheapest companies in our study for drivers with a DUI.
- American Family comes in seventh in our ranking of the cheapest car insurance companies for 2021. American Family’s average rate is $1,451, according to our analysis. That’s a considerable jump from Progressive’s rate, and it’s about 10% more than the national average. With this company, rates are higher than average for every demographic group we studied, with two notable exceptions: drivers with one accident and drivers with a DUI should consider American Family because rates for these groups are below average.
- Farmers is the eighth-cheapest car insurance company in our rankings. Its annual average rate of $1,634 is about 24% more than the national average, according to our analysis. For every driver demographic and archetype in our study, Farmers comes in above the national average, often by several hundred dollars or more.
- Allstate is the most expensive car insurance company in our annual rankings, with an average annual rate of $1,787. That’s 35% higher than the national average determined by our study. Allstate is among the most expensive insurance companies for every driver archetype we studied and is particularly expensive for 25-year-old drivers.
It’s important to note that our data may not include all states in which each of these companies operates.
How Much Is Car Insurance?
According to our study, the national average representative rate among nine of the largest car insurance companies in the country is $1,320. That being said, it’s not possible to say exactly what it will cost you since insurers set rates using a wide range of personalized data.
To demonstrate how much car insurance rates can fluctuate, we’ll look at how age or gender can affect the premiums in our study. Twenty-five-year-old men have the highest average rate in our study, at $1,554, followed closely by 25-year-old women, with an average of $1,487. The rates for 35-year-olds came in at $1,273 for women and $1,277 for men. The lowest nationwide average rates are for 60-year-old women, at $1,149, and 60-year-old men, at $1,182.
Your driving record is also a significant factor in your car insurance rates. The lowest average rate in our study is for drivers with a clean record, at $1,320. From there, there are significant increases in the average rate depending on the severity of the infraction. Our analysis determines that a single speeding ticket raises the average rate to $1,603, a single accident raises the average rate to $1,872, and a DUI raises the average rate to $2,111.
A credit score is another major factor in the cost of your car insurance. First, we took a look at the cost of car insurance for drivers with a good credit history, who have a national average of $1,310 across the major auto insurance companies in our study. With a fair credit score, the average study rate increases to $1,569, or an increase of about 20% over the driver with a good credit score. The average rate in our study for a driver with a poor credit score is $2,227, which represents a whopping 70% increase over the average for a driver with a good credit score. These numbers show that it’s clear that maintaining a good credit history is a key factor in finding the cheapest car insurance.
Note that some states do not allow insurance companies to use credit history as a factor in determining auto insurance rates, so data from California, Hawaii, and Massachusetts is not included in this section of our analysis.
The kind or amount of car insurance coverage you choose affects your rates, as well, so we took a look at how prices vary for different tiers of car insurance coverage. Drivers with a low level of coverage have an average study rate of $1,247. With medium coverage, that average rate goes up to $1,320, and with high coverage, it increases to $1,396. 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. The study rates for low and high coverage in our example show that more protection only costs about $12.50 more per month, which may be worth it for the additional peace of mind even if you don’t need to file a claim.