The Complete Guide to Cheaper Car Insurance in California

We’ve broken down everything you need to know about car insurance in California, including how much coverage you need, which companies offer the best rates, and plenty of other money-saving tips.

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by Nick Versaw Updated July 29th, 2022

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How Much is Car Insurance in California?

Cars with cheap insurance driving over the Golden Gate Bridge in California


Quick Facts

  • The average California driver pays around $66 a month for car insurance
  • San Ysidro is the cheapest city in California for car insurance
  • Grange Insurance tends to offer the cheapest average rates for California drivers

If you need car insurance, your first question is probably a simple one: How much will I need to pay? While auto insurance is never something you necessarily want to buy, the good news is that California is actually cheaper than average when it comes to the typical car insurance bill.

Avg. Premium
California $86/mo.
National Average $88/mo.
Cheapest Company Grange – $62/mo.
Most Expensive Company Chubb – $156/mo.

Across the U.S., the average driver pays about $88 a month for car insurance. In California, that number drops slightly to $86 a month. But as you can see at the bottom of this table, there’s a big difference between what different companies charge.

The cheapest car insurance company in California is Grange, whose average policy runs $62 a month. On the other hand, Chubb offers the overall most expensive rates at $156 a month – that’s over a 150% difference in price!

Since there’s such a big difference in prices between one company and the next, the best way to save on your California car insurance is to get quotes and compare prices regularly. Luckily, Compare.com does all the hard work for you. Just enter your ZIP below, answer a few simple questions and get real, accurate rates in just a few minutes.


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California Car Insurance Laws and Requirements

Every state in the U.S. requires all drivers to have car insurance in some form or fashion. And each will also typically have laws in place to punish those who drive without insurance. But what are California’s specific requirements and penalties? Keep on reading to find out.

California State Minimum Insurance Limits

The state minimum auto insurance requirements in California are (outlined in California Insurance Code §11580.1b) :

  • $15,000 in liability coverage for injury or death to one person
  • $30,000 in liability coverage for injury or death to more than one person
  • $5,000 in liability coverage for property damage

You’ll commonly see this type of coverage referred to as 15/30/5 – and compared to other states like Texas or New York, it’s actually quite low.

However, that doesn’t mean you should just automatically settle for the state’s minimum requirements. Think about it this way: Imagine you cause a collision with another driver and your insurance needs to cover the cost of damages. If the other driver has more than just $5,000 worth of damage to their vehicle, you’ll be on the hook for the rest. The average new car in 2022 is over $46,000, so if you end up totaling even the average new car, you’ll be stuck paying more than $40,000 out of pocket. Because of this, most drivers will want to shop for higher coverages than California’s mandatory minimums.

Penalties for Driving Without Insurance in California

Police car seen in a car's side mirror

 

But what happens if you don’t have insurance at all? Failing to meet California’s minimum requirements can result in a number of penalties. These include:

  • Suspension of your driver’s license plus a fee and the costs associated with a license and registration reinstatement
  • Impoundment of your vehicle
  • Being required to file an SR-22 annually for three years after reinstatement

To learn more about the requirements and penalties, visit the California Department of Insurance.

How to Get an SR-22 in California

If you have a poor insurance history, got caught driving without insurance, or have a streak of moving violations on your record, the DMV may require you to get a form called an “SR-22.”

An SR-22 isn’t actually a form of insurance, but is what’s called a “certificate of financial responsibility.” Essentially, it’s a document showing the state that you have the minimum liability insurance required by law. If you’re a high-risk driver, you may need your insurance company to provide this form to authorities to show that you’re legally insured.

If you need an SR-22 in California, you’ll have to see if your insurance company will submit a form to the DMV on your behalf. However, not all insurance carriers issue SR-22s, so you might need to shop around a bit to find one that fits your needs. Luckily, Compare.com works with a number of “non-standard” insurance companies that work specifically with high-risk drivers. So, if you need an SR-22, just enter your ZIP code below and compare quotes from top companies in minutes.


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Why is California Car Insurance So Expensive?

Couple confused about their car insurance policy

As we saw above, the good news is that California car insurance isn’t that expensive when compared to the rest of the country. But that doesn’t necessarily mean it’s cheap, either.

There are a lot of possible reasons you’re paying more for car insurance than your neighbor, friend, or family member. Mostly, it’s due to how car insurance companies calculate their rates.

What Factors Affect Your Rates?

A lot of different factors go into how much car insurance companies charge their customers. The five factors outlined below are some of the most important, but there are dozens of things insurance companies look at when deciding how much to charge you each month:

Your Age

Age is one of the most important factors when it comes to how much you’ll pay for car insurance. Young drivers (typically between the ages of 16-24) pay the most for car insurance of any group on the roads – sometimes as high as twice what drivers 25 and older pay. So, if you’ve recently turned 25, it might be a good time to shop around and see how much you can save.

Your Driving Record

Another important factor is your driving record. Generally, the more infringements you have on your record, the more you’ll pay for insurance. At-fault accidents generally have the biggest impact since that’s when insurance companies have to pay out damages, but speeding tickets, DUIs, and other related driving charges can also cause your rates to go up.

Luckily, you don’t have to live with those price hikes forever. Generally, driving infractions will drop off your record after five years, which can give your monthly bill a little relief. And if you want to lower your rates before that five years are up, try taking a defensive driving course. Many companies will give you a discount for completing one from an accredited institution.

Where You Live

Each state regulates car insurance individually, so average prices for car insurance can be drastically different from one state to the next. If you’ve recently moved to California from a more expensive state like New York, you might be welcomed with big savings. On the other hand, if you’re planning on moving out of California, you may end up paying more for your car insurance.

But it’s not just your state that matters. Your city, town, or even neighborhood can all have an impact on your monthly bill. Generally, areas with higher crime or more motor vehicle accidents will come with higher insurance premiums. On the other hand, if you live in a more rural area with fewer cars on the road, you might see some savings.

What Type of Car You Drive

What car, truck, or SUV you drive also can largely determine how much you pay to insure it. Typically, the more expensive the vehicle you drive, the more you’ll be asked to pay. Newer, more expensive vehicles will be the most expensive to insure, while older used cars will typically cost less.

How Much Coverage You Need

There are several different types of coverage you can get to insure your vehicle, and within each type of coverage, the levels often vary. For example, you could get the bare minimum coverage required by your state (in California, that’s basic liability insurance – more on that later) and pay as little as possible. But that won’t cover damage to your car if you cause an accident, only the other party’s. In that case, you might want “full coverage” that typically includes collision and comprehensive policies, which will usually cost you quite a bit more each month. There are also other types of coverage like Personal Injury Protection (PIP), MedPay, Uninsured/Underinsured Motorist coverage, and more. Each one will come with an extra cost.

Does Gender Affect Car Insurance Rates in CA?

In most cases, car insurance companies use your gender as one of the factors that go into how much you’ll pay. However, some states have banned the use of gender as an insurance rating factor. California became one of those states in 2019, alongside Hawaii, Massachusetts, Maine, Michigan, Montana, North Carolina, and Pennsylvania.

In other states where gender can be used, men tend to pay around 5% more than women for the same policy.

Does Credit Score Affect Your Rates in California?

Another common factor many companies use to calculate rates is credit score. These companies argue that if you have a bad credit score, you’re less likely to pay your insurance premium on time, which increases the risk of offering you coverage. However, if you live in California and have a less-than-perfect credit score, don’t worry. Just like gender, California has banned companies from using credit score as a rating factor (for both car insurance and homeowners insurance). Hawaii and Massachusetts have also banned the practice.

Which Car Insurance Companies Offer the Cheapest Rates in California?

Woman shopping for cheap car insurance

If you’re shopping for auto insurance in California, you’re probably wondering which company offers the cheapest rates. Check out the table below to find out the top 5 cheapest companies and how much they charge the average California driver.

Company Average Monthly Rates
Grange $62.48
USAA $62.59
Progressive $63.17
Wawanesa $64.83
Mercury $64.95

You probably see all sorts of commercials, billboards, and other advertisements for companies like GEICO or State Farm, but the company offering the cheapest average rates in California is actually a smaller insurer called Grange Mutual Casualty Company.

Grange barely edges out USAA in California, with average rates just over $62 a month. Rounding out the rest of the top 5 are Progressive ($63/mo.), Wawanesa ($64/mo.), and Mercury ($64/mo.).

This just goes to show that the cheapest or best insurance companies aren’t necessarily the ones with the most ads on TV. Sometimes, the best rates come from companies you may not have even heard of. That’s why it’s so important to use comparison websites like Compare.com. Services like these work with dozens of insurers, both big and small, to find you the best rates.

Want to find the cheapest rates for you? Just enter your ZIP code below!


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The 10 Best Auto Insurance Companies in California

So, you’ve seen which companies offer the cheapest average rates to California policyholders, but sometimes, choosing the right company is about more than just price. Many shoppers also take into consideration things like customer service, financial stability, and other things when choosing their next insurance company.

J.D. Power puts out a study every year that scores and ranks overall customer satisfaction for all the top insurance companies. This “Overall Customer Satisfaction Index Ranking” is based on a 1,000-point scale. For 2021 (the most recent data available), these are the top companies according to J.D. Power:

  1. USAA (870 points) – Unfortunately, only military members and their family are elligble to become USAA members, but if you or a loved one served in the military, USAA has among the best customer satisfaction scores in the entire industry – and some of the cheapest rates, too.
  2. Wawanesa (853 points) – Wawanesa is the highest-rated company on this list that anyone, regardless of military status, is elligible for. And they’re also one of the cheaper companies for the average driver, so theyr’e definitely worth looking into.
  3. CONNECT by American Family (849 points) – American Family (commonly known as AmFam) has been around for nearly 100 years. CONNECT is a subsidiary of the insurance giant and scores great scores across the Golden State.
  4. Auto Club of Southern California Insurance Group (830 points) – An affiliate of AAA (yes, the folks who come help if you get a flat tire or run out of gas), Automobile Club of Southern California are a great option for many California drivers that live in the lower half of the state, with competitive rates and over 120 years of experience insuring drivers across SoCal.
  5. GEICO (828 points) – Perhaps the most recognizable name on this list, GEICO scores consistently high ratings, not just among California drivers, but all across the country. So, if you ever plan to leave California and move to another state, they may be a great option for you.

There are a lot of companies who get great ratings, and even more who offer competitive rates, but which company is the best for you? Whether you’re currently in the market for a new policy or just starting the process, take 15 minutes and get free quotes from dozens of California’s top car insurance companies. Just enter your ZIP below to get started.


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The Cheapest California Companies by Driving Record

Man driving a car

You’re probably already aware that your driving record plays a big role in how much companies charge you for car insurance, but you might be wondering exactly how much. At the end of the day, different companies specialize in different types of drivers, so if you have a clean record, one company may offer you the best rates, but if you cause an accident or get a ticket, there may be another company out there with cheaper premiums.

So, let’s break it down and see which companies offer the cheapest average rates for different types of driving records.

Cheapest Companies for Drivers with Clean Records

Obviously, clean records are going to get you the cheapest rates, but which company is the cheapest overall?

Company Average Monthly Rates
Progressive $39.73
USAA $41.43
GEICO $42.24
Wawanesa $46.07
Mercury $47.23

In California, Progressive offers the best average rates for drivers with clean records, coming in just under $40 a month. However, a few companies aren’t far behind. USAA and GEICO also offer incredibly cheap rates to good drivers in California.

Companies to Consider After an At-Fault Accident

Let’s face it: if you cause an accident, you’re probably looking at a significant increase in your monthly car insurance bill. However, that doesn’t mean you can’t still shop around and find a better deal. Let’s look at which companies offer the most competitive rates for drivers with an at-fault accident on their records.

Company Average Monthly Rates
USAA $56.97
First American $62.18
Grange $62.61
CSAA $66.20
Workmen’s $68.61

Oddly enough, Progressive (which was cheapest for drivers with clean records) isn’t even in the top 5 when it comes to cheapest rates after an accident. Here, USAA leads the pack with average rates of just under $60/mo.

You’ll also notice a couple of lesser-known companies on this list. Some of these are known as “non-standard” carriers, meaning they specialize in drivers with less-than-perfect driving records. So, if you get into an accident, the big-name insurance companies might not actually be the best fit for you.


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Companies that Offer Cheaper Rates for Drivers with Speeding Tickets

Moving violations are another thing that can cause insurance companies to raise your rates. However, the increases likely won’t be quite as significant as if you got into an at-fault accident.

Company Average Monthly Rates
USAA $45.31
Kemper $58.10
GEICO $60.90
Mercury $60.90
First American $62.18

USAA again comes out on top when it comes to affordable rates for ticketed drivers. Their average rates for these types of drivers come out more than 20% cheaper than the next closest carrier.

If you’re not in the military or aren’t otherwise eligible for USAA, companies like Kemper, GEICO, and Mercury are other good alternatives.

Cheapest Companies for Drivers with a DUI

It’s no secret that a DUI or DWI conviction comes with some serious penalties. Alongside the legal troubles you might face if you’ve recently been charged with driving under the influence, your insurance costs are likely going to go up significantly.

Company Average Monthly Rates
National General $70.32
Mercury $71.74
Grange $73.21
Kemper $74.02
Wawanesa $76.50

Some of the non-standard carriers we mentioned earlier again show up on the list of cheapest companies for drivers with a DUI. National General, Mercury, Grange, and Kemper all come in with average rates under $75 a month. So, if you’ve recently gotten a DUI, it might be worth looking into a new car insurance company.


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Top 5 Cheapest Companies for CA Teens

teenager driving a car

If you have a teenage son or daughter getting ready to get behind the wheel, you’re unfortunately probably looking at a hefty insurance bill. But that doesn’t mean you can’t find a better deal elsewhere. Below are the top 5 cheapest companies for teens in California.

Company Average Monthly Rates
Wawanesa $110.80
USAA $115.47
Mercury $120.97
Progressive $120.99
Travelers $121.04

Again, we see a smaller insurer top the list for teen drivers – Wawanesa offers teens an average rate of about $110 a month. Some other companies worth looking into if you have a teen driver include USAA, Mercury, Progressive, and Travelers.

Most Affordable Full Coverage Insurance

If your car is financed or leased, your lender probably requires “full coverage” insurance on your vehicle. But what is full coverage?

While the term can sometimes have different meanings, “full coverage” generally means a policy with standard liability coverage (for bodily injury and property damage to other people and their belongings), as well as comprehensive and collision coverages that cover damage to your own vehicle.

So, which company offers the best rates for full coverage insurance in California?

Company Average Annual Rates
Wawanesa $144.88
National General $161.39
Progressive $189.87
Eagle West $196.73
USAA $198.13

Again, we see Wawanesa top the list of cheapest companies, offering rates around $145 a month for full coverage. The next closest company – National General – is nealy 10% more, and then the list jumps even more after that.

The Cheapest Cities for Car Insurance in California

Did you know that your address plays a big role in how much you pay for insurance? Not only what city you live in, but your ZIP code or even neighborhood can influence rates. So, which California city has the cheapest average rates?

City Average Monthly Rates
San Ysidro $34
Crescent City $37
Clearlake $40
Oroville $40
Santa Maria $40
Dinuba $41
El Centro $41
Eureka $41
Porterville $41
Banning $42

San Ysidro has the cheapest rates in all of California, with average prices coming in at just $34/mo. The rest of the top 5 include Crescent City, Clearlake, Oroville, and Santa Maria.

As you can see, typically smaller cities with fewer cars on the road have cheaper rates. In contrast, Los Angeles drivers pay around $73/mo. – more than twice as much as drivers in San Ysidro.

For a full list of cities, check out our guide on the cheapest cities for car insurance in California.

How Californians Can Get Cheaper Auto Insurance Rates

Woman looking at phone excited about getting a discount on her car insurance

We’ve broken down the cheapest rates across California, but that doesn’t mean there isn’t still money on the table. There are tons of other car insurance hacks and discounts out there that can save you even more. Below are just a few examples:

Take Advantage of as Many Discounts as Possible

One of the best ways to lower your auto insurance rate is to take advantage of discounts offered by the insurance company. You’ll want to check with each individual company to see which discounts are available, but here are some common discount options.

  • Multi-Car Discounts: If you insure multiple cars on your policy you can save up to 25% on your premium with a multi-car discount.
  • Multi-Policy Discount: When you also need insurance for your home, apartment, or even life insurance, bundling it with your auto insurance under the same policy can also help you save up to 25% on your premium compared to insuring them separately.
  • Pay in Full Discount: Insurance companies will reward you for paying in full by offering a pay in full discount. Not only do you save on your premium, but you also don’t have to worry about forgetting to make your payment each month.
  • Vehicle Safety Discount: Ensuring your vehicle has some of the latest safety features can help you save a bit on your auto premium. Some of the features that will earn you a discount include having anti-lock brakes and electronic stability control.
  • Good Driving Discount: Save up to 40% on your insurance premium when you demonstrate good driving habits. You may need to use a telematics tracking system to do so, but the savings can be worth it if you can meet the standards.
  • Defensive Driving Course Discount: While taking a defensive driving course might not be fun, it can save you 10% or more on your auto insurance. As long as you complete a state-approved course, you should be able to enjoy this discount.
  • Usage-Based Discount: If you drive fewer miles than the average American, you might be eligible for a pay-per-mile also known as usage-based auto insurance discount. On this plan, you typically have a low monthly base price and pay extra based on the number of miles you drive.
  • Customer Loyalty Discount: Have you been with the same insurance company for a long time? If so, you may be eligible for a customer loyalty discount.
  • Good Student Discount: If you’re currently a high school or college student living in California, you can save money on your insurance premium with a good student discount. To qualify, you’ll have to maintain a B average/ 3.0 GPA or higher. Students who rank in the top 20% of their class may also qualify for this discount. Check with your insurance company to find out their specific qualifications.

Shop Around Every Six Months

Did you know your car insurance rates can increase every time your policy renews? Sometimes, you may not even realize it until you get your first bill. Luckily, you can usually cancel your policy and switch companies at any time, so we always recommend shopping around by getting quotes every six months.


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Think About Raising Your Deductible

If you have full coverage, your deductibles for comprehensive and collision coverages plays a big role in your monthly bill. A higher deductible means cheaper rates (just like a lower one means higher prices), so if you feel comfortable risking paying a little more out of pocket if you get in an accident, consider raising your deductible from the typical $500, to something more like $750 or $1,000.

Pay Your Policy In Full

Most people choose to have their car insurance premiums spread out over the course of 6 or 12 months, but did you know many car insurance companies will cut you a deal if you pay the premium in full?

Get Quotes from as Many Companies as Possible

Car insurance shopping used to be tedious. You’d have to call up each company, give them all of your information and get quotes from each company, one-by-one. These days, it’s much easier. Price comparison sites like Compare.com let you enter your info once and have dozens of companies competing for your business, saving you both time and money. After all, how do you know which company is cheapest for you if you don’t get quotes from as many as possible? Just enter your ZIP below and get rates from California’s best car insurance companies in just a few minutes


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Look Into California’s Low Cost Automobile Insurance Program

If you’re a low-income driver in California, you may be eligible for some financial assistance when it comes to your car insurance bill. In 1999, the California legislature established California’s Low Cost Automobile Program, known as the CLCA, to help low-income Californians get adequate liability protection at a fair price.

To learn more about the CLCA or see if you qualify for benefits, check out mylowcostauto.com and take the eligibility questionnaire.

Helpful Resources for California Drivers

Man researching car insurance

Below are just a few helpful links for California drivers to learn more about car insurance and other transportation resources all throughout California.

Frequently Asked Questions About Auto Insurance in California

How much is car insurance in California?

Based on the amount of coverage you need and several other factors, insurance rates in California will vary. In general, the average auto insurance rate is $87/mo.

What car insurance is required in California?

In California the minimum insurance coverage levels are:

Body Injury Liability: $15,000 for injury/death to one person; $30,000 for one accident

Property Damage Liability: $5,000

What happens if you drive without insurance in California?

If you’re caught driving without insurance in California, your consequence will start small and increase if it happens more than once.

The first time around you’ll receive a fine of up to $250 along with penalty assessments.

Penalty assessments can vary based on where you live but range from $1 for every $10 up to $10 for every $10 you owe in fees. That means if your fine is $100, you could owe up to an additional $100 in penalty assessments which doubles the total amount you have to pay.

If you’re caught driving without insurance again within 3 years, you could receive a fine of up to $500 plus penalty assessments.

Also, anytime you’re caught driving without auto insurance the court can elect to impound your vehicle.

Does California require full coverage car insurance?

California doesn’t require full coverage auto insurance. You can choose to secure a higher level of auto insurance coverage which will generally include a combination of liability, comprehensive, and collision coverage.

Can you get car insurance without a license in California?

While you can get car insurance in California without a license, it’s definitely more challenging to do. And if you previously lost your license due to driving infractions it presents even more difficulties. Your best bet for securing auto insurance without a license is to work with a smaller insurance company that might be more flexible with their requirements.

 


Methodology

All data referenced in this article comes from a combination of proprietary data — which is aggregated from millions of real customer quotes through Compare.com — and additional data gathered in collaboration with Quadrant.

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