Your Guide to the Best Low-Income Car Insurance Companies
At Compare.com, it’s our mission to find simple ways to help our customers save money on the things they need. While we partner with some of the companies and brands we talk about in our articles, all of our content is written and reviewed by our independent editorial team and never influenced by our partnerships. Learn about how we make money, review our editorial standards, and reference our data methodology to learn more about why you can trust Compare.com.
Yet, there is no need for low-income drivers to remain uninsured or underinsured. Today, many auto insurance providers offer low rates and generous discount programs.
This guide will answer your questions about low-income car insurance, including what to look for with low-income policies and our top recommendations on top low-income auto insurance providers.
Unlock Your Cheapest Rates for Free
Unlock Your Cheapest Rates for Free
What Do the Best Low-Income Car Insurance Companies Offer?
When looking for a low income car insurance policy, be sure to take the following factors into account:
- Cost: Arguably, the number-one criterion, the cost of insurance relative to other providers, is a defining determinant for low-income drivers.
- Excellent customer service: Look for auto insurers with a strong customer service track record. Award extra points for solid customer service scores on J.D. Power and authoritative third-party review sites like Clearsurance and Trustpilot.
- Discount programs: Find car insurance companies with strong discount programs. These include discounts outside good driver discounts, such as policy-related discounts (e.g., setting up autopay or paperless billing) and usage-based programs that use mobile apps or in-vehicle telematic devices to monitor driving habits.
- Accident forgiveness programs: A single accident for a low-income driver can double their annual premium, turning monthly budgeting upside down. In our research, we prioritized auto insurers with accident forgiveness programs that allow for one accident every three-to-five years, leaving your premium and good driver status intact.
What Are the Best Low-Income Car Insurance Companies?
We evaluated several of the best low-income auto insurance companies to help get you started on your research. We narrowed down the options to the following four providers.
GEICO continually offers low rates to its policyholders, including low-income drivers and those with poor credit. We also appreciate GEICO‘s accident forgiveness program, available as an additional paid coverage option or free for qualifying drivers with clean records after five years.
On top of discount programs, GEICO ranks high in customer satisfaction. According to J.D. Power’s 2021 U.S. Auto Insurance Study, GEICO achieves a top-10 rating in overall customer satisfaction across all regions, joining other highly reputable insurers like Farmers, State Farm, and Progressive.
Other notable mentions include an A+ rating from the Better Business Bureau (BBB) and an average 4.1 rating from Clearsurance across 19,000+ reviews (as of October 2022).
2. State Farm
Like GEICO, Bloomington, Illinois-based State Farm is a well-rounded performer, earning top-10 marks in the same J.D Power auto insurance study across all regions.
State Farm also has vital discount programs and an accident forgiveness program that automatically waives your first at-fault accident as long as you maintain a clean driving record for at least nine years.
Allstate has a generous discount program, cutting premiums on everything from installing anti-lock brakes to enrolling in Allstate eSmart®, its paperless billing program.
With many low-income drivers being students, Allstate offers a Smart Student discount as long as you complete its teenSMART driver education program and maintain an overall B- (2.7 GPA) or higher grade point average.
One of our favorite auto insurance programs is Allstate’s Deductible Rewards program, which cuts $100 off your collision deductible upon signing and another $100 off of your deductible for every year you maintain a clean driving record to a limit of $500.
4. Liberty Mutual
The sixth-largest property and casualty insurer nationwide, Liberty Mutual is well diversified, offering a mix of low rates and discount programs for low-risk drivers.
Arguably Liberty Mutual’s biggest strength is its RightTrack safe driver program. It offers up to 30% off of your premiums in exchange for downloading an app that monitors your driving habits – like braking and the number of miles you drive. After 90 days of use, Liberty Mutual will apply your discount to your premium.
How Can I Lower My Low-Income Car Insurance Rates?
Fortunately, if you are a low-income driver, there are many ways you can save on auto insurance once you determine your provider. You can do the following:
- Maintain a clean driving record: Maintaining a good driving record is your best bet toward lower auto insurance rates. Typically, auto insurers award good driving discounts to those with no claims or moving violations within the last three to five years.
- Raise your deductible: Deductibles are out-of-pocket expenses paid toward an insured loss before your auto insurer covers the rest, regardless of coverage level. Increasing your auto insurance deductible from $250 to $500 or from $500 to $1,000 will lower your comprehensive coverage and collision coverage premium costs.
- Reduce your coverage: Having full coverage liability limits of $100,000 in bodily injury per person, $300,000 in bodily injury per accident, and $100,000 in property damage liability is a good idea. But, low-income drivers can reduce auto insurance coverage to the state’s minimum coverage to save money. You may drop comprehensive and collision coverage if your vehicle is worth $10,000 or less. However, you may not be able to pay for out-of-pocket costs to your property, only that of other drivers (up to your policy’s liability, bodily injury, and property damage limits).
- Shop for pay-per-mile car insurance: Usage-based insurance programs offer lower premiums for driving less. These policies typically factor in a base rate and a small sum for every mile over your monthly mileage limit. It’s excellent for drivers who log less than 12,000 miles a year.
- Participate in state-funded car insurance programs: Many states, like California, New York, and Hawaii, have government-sponsored programs for low-income individuals to save on auto insurance. These include California’s Low-Cost Auto Insurance Program (CLCA), New Jersey‘s Special Automobile Insurance Policy (SAIP), and Hawaii‘s Aid To the Aged, Blind, and Disabled Program (AABD). For more information on these programs, please visit their respective websites.
- Apply for discounts: Auto insurance discounts extended to low-income drivers typically fall into one of five categories: policy, driver behavior, usage-based, vehicle-based, and affiliation-based discounts. Eligibility requirements depend on the discount offered.
Understanding Discount Programs
Remember, not all discounts are automatically applied. It is a good idea to call your auto insurance company every six months to see what discounts you may qualify for. Here are the five types of discounts in greater detail:
- Policy discounts are based on modifications to your existing policy. Examples of policy discounts include bundling (e.g., auto and homeowners insurance), enrolling in autopay or paperless billing, and adding more than one vehicle to your coverage.
- Driver behavior discounts reward good driving habits. Auto insurers consider habits like enrolling in defensive driving courses, boosting your credit score, driving less than 7,500 miles a year, and maintaining a claims-free driving record for three to five years.
- Usage-based discount programs reward drivers for driving less than 7,500 miles a year and joining a telematics program to track their driving habits, such as top speed and accelerometer pressure.
- Vehicle-based discounts apply to risk-proofed vehicles. Installing daytime running lights, anti-lock braking systems (ABS), and other safety features reduce the likelihood of a filed claim, lowering your risk profile.
- Affiliation-based discounts recognize your professional and academic affiliations. For example, discounts based on driver affiliation include senior, military, and good student discounts.
Shop Around for the Best Car Insurance Rates
If you are a low-income driver, you do not need to forgo insuring your vehicle to save money. Rest assured, there are plenty of low-income car insurance programs. Start by looking into our best options for a policy that can fit your budget and provide solid coverage.
Now is an excellent time to shop around and research the cheapest car insurance quotes from different affordable car insurance providers. Compare all of your options by entering your ZIP code below:
Compare Rates from Dozens of Companies
Compare Rates from Dozens of Companies
Compare Car Insurance Quotes
Compare.com’s #1 goal is to save you money. We publish resources that are based on hard-hitting data and years of industry experience to help you make more informed decisions with your wallet.
- All of Compare.com’s content is written and reviewed for accuracy by a team of experienced writers and editors who are experts on the topics they cover.
- None of Compare.com’s content is ever influenced by the companies and brands we partner with.
- Compare.com’s editorial team operates independently of any of the company’s partnership or business development interests. We publish unbiased information strictly for the benefit of our readers.
- All of the content you see on Compare.com is based on comprehensive analysis and all data is gathered and vetted from trustworthy sources.