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Erin Gobler is a personal finance writer and journalist who has been writing for Compare.com since 2023. With more than five years of experience personal finance experience, Erin has covered topics such as investing, credit cards, mortgages, insurance, and more.
Her work has been featured in major publications like Business Insider, Fox Business, and Time.
Erin received her bachelor’s degree from the University of Wisconsin-Oshkosh in 2013, studying journalism and political science. She also received a certificate of financial planning from Boston University in 2022.
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Matthew Gross is an editor at Compare.com. With a background in editing and SEO, he’s passionate about creating content that helps readers get the information they need to make more informed decisions. Prior to Compare.com, Matthew brought his user-centered approach to his work with global brands like Apple and Adobe.
Matthew graduated from Illinois State University, where he earned his bachelor’s degree in Journalism.
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Senior Director, Media Relations, with Triple-I
30+ years of industry experience
Leadership positions at several trade organizations
Mark Friedlander is Senior Director, Media Relations, at the Insurance Information Institute (Triple-I), where he serves as a national spokesperson, handling a wide array of insurance industry media issues. His responsibilities also include spearheading the association’s hurricane season communications strategy and its member company support and media outreach.
Throughout his 30+ years in the insurance industry, Mark has held leadership positions across multiple trade groups, including serving as Board Chair and President of the Insurance Marketing & Communications Association (IMCA). He has also advised editorial teams at organizations such as U.S. News & World Report, Insurify, Bankrate, and more.
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While we make money through partnerships with some of the brands we discuss in our articles, our editorial team operates 100% independently, and these partners never influence or affect the topics, reviews, ratings, or recommendations we provide. We never guarantee favorable reviews or mentions in exchange for compensation from any brands or partners, and we uphold strict editorial standards to ensure our content is always independent, truthful, and unbiased.
You may have heard of no-down-payment insurance or no-deposit insurance, but those policies don’t technically exist. No matter what type of car insurance you buy, you’ll always have to pay something up front. In many cases, you must pay your first monthly premium.
The type of deposit and the amount will differ from company to company. But the good news is that, even with needing an initial payment when you sign up for car insurance, you still have ways to save money — both right away and over the course of your entire policy term.
We’ll cover some of the best options for low-down-payment car insurance, including the most affordable companies, budget-friendly alternatives, and other savings tips.
There’s no such thing as true no-deposit insurance from a reputable insurance company.
You can often lower your up-front payment by choosing an alternative policy type, such as pay-as-you-go, pay-per-mile, or non-owner insurance.
Many factors affect your premiums, and you can take steps to lower your car insurance costs when you sign up for your policy.
As we already covered, true no-deposit car insurance policies don’t exist. Instead, you can try to find a policy with the lowest deposit possible. Generally speaking, liability-only or state-minimum insurance has the lowest up-front payment.
Liability insurance pays for damage and injuries you cause to other drivers on the road, whether it’s an injury or damage to their vehicle or other property. It’s usually the cheapest type of policy because it only pays for other people’s damages. But it doesn’t cover damage to your vehicle like full-coverage insurance does.
But if you’re looking for the lowest possible initial payment, it’s a good idea to start with one of the companies highlighted in the table below. These companies have the cheapest average rates for liability-only coverage, according to Compare.com data.
Company  | Average Monthly Premium |
|---|---|
| COUNTRY Financial | $45 |
| Auto-Owners | $47 |
| USAA | $53 |
| State Farm | $56 |
| NJM | $58 |
| Mile Auto | $71 |
| Erie | $75 |
| Allstate | $76 |
| Commonwealth Casualty | $83 |
| American Family | $83 |
| Safeco | $86 |
| GEICO | $87 |
| The General | $91 |
| Root | $92 |
| National General | $92 |
| Dairyland | $93 |
| Direct Auto | $96 |
| Mercury | $96 |
| Nationwide | $98 |
| Progressive | $99 |
| Metromile | $100 |
| Travelers | $101 |
| Bristol West | $102 |
| GAINSCO | $103 |
| Elephant | $110 |
| Farmers | $111 |
| Anchor | $113 |
| Chubb | $121 |
| AssuranceAmerica | $126 |
| 21st Century | $135 |
| Clearcover | $140 |
| Plymouth Rock | $141 |
| CSAA | $142 |
| Shelter | $142 |
| Liberty Mutual | $150 |
| The Hartford | $151 |
| State Auto | $155 |
| Amica | $268 |
Keep in mind that the low up-front and monthly payment isn’t always worth the added risk. If you’re in an at-fault accident and have only liability coverage, you’ll end up paying for the damage to your vehicle out of pocket.
Be wary of any company claiming to offer auto insurance with no down payment or no deposit. Any reputable car insurance company will require you to pay at least the first month’s premium up front. A claim of “no-deposit insurance” is, at best, a marketing ploy and, at worst, a fraudulent scam.
You might see some insurance agents or companies advertise policies with “no deposit.” Your first thought is probably that you don’t need to pay anything to get coverage, but that’s not really the case.
A deposit typically implies that it’s something you could get back after a certain period of time, likely at the end of your policy (for example, a security deposit when you rent an apartment). Deposits like that don’t really exist for car insurance.
All reputable insurance companies will require you to pay at least one month’s premium up front, which then activates your coverage. If a company asks for no initial payment at all, it may be untrustworthy.
So it’s important to be wary of any company that advertises a car insurance policy with no money down.
It’s not possible to completely avoid an up-front payment on your car insurance. But you still have options if you need insurance and don’t necessarily have hundreds of dollars to spend on an annual or six-month policy term.
Here are some types of insurance to consider if you want to avoid a traditional auto insurance payment.
Pay-as-you-go car insurance — a type of temporary or on-demand insurance — allows you to purchase insurance for only the amount of time you need it, even if it’s just a few days at a time. Instead of paying for an entire month, you’ll pay only for the days you actually need.
While it’s a great option if you need coverage for just a few days, it may not be the most affordable or efficient for a vehicle if you drive regularly. Additionally, this type of coverage isn’t widely available from most companies. Hugo is the only option as of this writing.
| User Reviews | 4.4 |
|---|---|
| Our Rating Compare.com's ratings are determined by our editorial team. The objective formula used in these reviews weighs several important factors to consider when choosing financial products and services, including customer satisfaction ratings, ease of use, and a number of other components. | NR |
Founded in 2016, Hugo provides a convenient option for drivers looking for flexible, short-term coverage without long-term commitments. But their policy offerings and availability are currently quite limited.
Get coverage for as little as three days
Turn coverage on/off as needed
Same-day policies with no down payment
Doesn’t offer SR-22 and FR-44 insurance
Higher rates for drivers with spotty records
Coverage only available in 16 states
Pay-per-mile insurance charges you based primarily on the number of miles you drive each month. A typical pay-per-mile policy has a low base rate, which you’ll pay each month no matter what. Then, you’ll pay an additional per-mile rate based on the number of miles you actually drive.
Most pay-per-mile programs use telematics to track your mileage monthly. But some insurers, like Mile Auto, require you to only upload a photo of your odometer.
Pay-per-mile insurance is a great option for low-mileage drivers, such as remote workers and retirees. But if you drive a lot, it may actually end up being more expensive for you.
| AM Best AM Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor). | NR |
|---|---|
| Our Rating Compare.com's ratings are determined by our editorial team. The objective formula used in these reviews weighs several important factors to consider when choosing financial products and services, including customer satisfaction ratings, ease of use, and a number of other components. | 4.4 /5 |
| Liability Only Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages. | $71/mo |
| Full Coverage Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible. | $118/mo |
Low-mileage drivers may be able to save money with this pay-per-mile insurer, but limited availability and a potentially confusing claims process mean Mile Auto may not be the best choice for every driver.
Rates based on monthly mileage
No data tracking
Quick and easy quote process
Only available in eight states
Unclear claims process
High volume of negative customer reviews
Non-owner car insurance may be right for you if you don’t own a vehicle but occasionally drive someone else’s.
You probably don’t need non-owner car insurance if you’re just driving someone’s car once. In these cases, the owner’s insurance will apply, as long as their policy allows permissive use. But non-owner coverage can be a good option if you frequently drive someone else’s vehicle.
Because you don’t own the vehicle, you’ll typically pay less than you would for a traditional car insurance policy. But keep in mind that non-owner policies apply only after you’ve exhausted the vehicle owner’s car insurance policy.
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If you’re looking for an insurance policy that allows you to pay as little as possible up front, there are ways to pay less today for your new policy.
Compare quotes from several companies. Rates can vary drastically from one company to the next. It’s important to compare personalized quotes from at least three insurers so you can get the lowest price (and required down payment to begin coverage).
Choose an alternative policy. If you want to save money and don’t necessarily need a traditional policy, consider an alternative policy type, such as pay-as-you-go, pay-per-mile, or non-owner car insurance.
Lower your deductible or coverage limits. You can lower your payments by making slight tweaks to your policy, such as opting for a lower deductible, fewer coverage options, or a lower coverage level. But if you lower your deductible, make sure you can afford the extra expense if you need to file a claim.
Ask about insurance discounts. Check with your insurance company about any discounts you may qualify for, such as for bundling your policies, having a safe driving record, or owning a vehicle with certain safety features. Insurance companies also offer discounts for policyholders who pay their premium in full.
Consider a payment plan. You can lower your first payment by choosing to pay for your policy monthly instead of all at once. But keep in mind that you’ll probably end up paying more in the long run to save a bit of money right away.
Car insurance rates vary because of many different factors — some of which are within your control, while others aren’t.
First, rates may differ from company to company, even for the same driver. When you shop around for rates, you’ll probably find that some companies give you considerably lower quotes.
Other factors that affect your rates are more personal to you. For example, your age, location, gender, credit history, and driving record can all factor into your rates. Generally speaking, the higher a risk you pose to an insurer, the more you can expect to pay.
The good news is that regardless of your situation, you can find more affordable rates simply by shopping around for insurance and comparing rates across several companies.
Compare the lowest rates from dozens of top insurance companies.
If you’re looking for no-deposit car insurance, here are a few more things you may want to know to help you pay the lowest amount up front.
Not really. Any reputable insurance company will require you to pay at least some of your premium up front. Be wary of companies offering insurance without a down payment because they may be untrustworthy.
Unfortunately, no. It’s typically not possible to buy car insurance without paying anything up front. At the very least, expect to pay the first month’s premium to activate coverage.
No car insurance companies completely waive initial payments. But by shopping around, you can find companies that you’ll pay less for when you sign up.
The cheapest car insurance right now is COUNTRY Financial, with average rates of just $45 per month, according to our data.
But your personal rates will vary based on many factors, including your location, driving history, age, and more. No one company is the cheapest for everyone.
No. There’s no car insurance you won’t pay anything up front for. But in many cases, the amount you pay will be limited to your first month’s premium.
Yes. Hugo insurance is real. But it’s a nontraditional type of car insurance, and offer coverage in only 16 states. Rather than offering policy terms of six months or a year, Hugo offers car insurance for as little as a few days at a time. That could make it ideal if you only need a temporary solution.
You can’t avoid paying anything up front when you buy car insurance, but you can avoid unnecessary costs by choosing a company that doesn’t charge an additional deposit. The best way to find companies like these is to compare personalized quotes from as many as possible. An insurance-comparison website can help.
No. Insurance companies always require you to put some sort of payment down to initiate your coverage. It’s typically your first month’s premium.
That said, some companies (like Hugo) have much smaller down payments since they let you buy coverage for shorter stints. But, unfortunately, you’ll need to pay something for your coverage to start.
Data scientists at Compare.com analyzed more than 50 million real-time auto insurance quotes from more than 75 partner insurers in order to compile the rates and statistics seen in this article. Compare.com’s auto insurance data includes coverage analysis and details on drivers’ vehicles, driving records, insurance histories, and demographic information.
All the rates listed in this article have been collected from a combination of real Compare.com quotes and external insurance rate data gathered in collaboration with Quadrant Information Services. Compare.com uses these observations to provide readers with insights into how auto insurance companies determine their premiums.
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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.
Learn more about us, our team, and what makes us tick.
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Erin Gobler is a personal finance writer and journalist who has been writing for Compare.com since 2023. With more than five years of experience personal finance experience, Erin has covered topics such as investing, credit cards, mortgages, insurance, and more.
Her work has been featured in major publications like Business Insider, Fox Business, and Time.
Erin received her bachelor’s degree from the University of Wisconsin-Oshkosh in 2013, studying journalism and political science. She also received a certificate of financial planning from Boston University in 2022.
Matthew Gross is an editor at Compare.com. With a background in editing and SEO, he’s passionate about creating content that helps readers get the information they need to make more informed decisions. Prior to Compare.com, Matthew brought his user-centered approach to his work with global brands like Apple and Adobe.
Matthew graduated from Illinois State University, where he earned his bachelor’s degree in Journalism.
Senior Director, Media Relations, with Triple-I
30+ years of industry experience
Leadership positions at several trade organizations
Mark Friedlander is Senior Director, Media Relations, at the Insurance Information Institute (Triple-I), where he serves as a national spokesperson, handling a wide array of insurance industry media issues. His responsibilities also include spearheading the association’s hurricane season communications strategy and its member company support and media outreach.
Throughout his 30+ years in the insurance industry, Mark has held leadership positions across multiple trade groups, including serving as Board Chair and President of the Insurance Marketing & Communications Association (IMCA). He has also advised editorial teams at organizations such as U.S. News & World Report, Insurify, Bankrate, and more.
