Low-Income Car Insurance

If you’re looking for the cheapest coverage possible with low income, consider minimum liability coverage. According to our rate averages, the cheapest liability car insurance available nationwide for most drivers is typically Geico, which has an average cost of $461 per year for 35-year-olds. You can also find affordable coverage from companies like State Farm, Nationwide, Travelers and Progressive.

Cheapest Minimum Liability Car Insurance For Low Income

Below, you can see the cheapest minimum coverage rate averages among nationally available insurers to consider if you have low income:

If you can afford full coverage car insurance with a low income, Our averages show Nationwide is generally the cheapest major provider, with average rates of $1,433 per year or $119 per month:

There aren’t many auto insurance assistance programs in the country. You can only find low-income car insurance options in California, New Jersey and Hawaii. However, if you are looking for car insurance on a tight budget you can check out our guides to the cheapest car insurance in states that don’t offer these programs below.

Low-Income Car Insurance California

California’s Low-Cost Auto Insurance Program (CLCA) helps provide car insurance for drivers for free who can’t afford standard coverage.

To qualify for CLCA coverage, you need to:

• Be at least 16 years old
• Have a valid California driver’s license
• Own a car valued at $25,000 or less
• Have a good driving record or be a new driver

You also need to meet income requirements. We’ve listed a few below, but the CLCA website has a calculator for any household size.

California Low-Income Auto Insurance Coverage

California’s car insurance assistance program offers liability coverage that meets the state’s minimum requirements. That means it covers damage to other cars and other people’s medical bills when you cause an accident. Here’s what it covers:

• $10,000 bodily injury per person
• $20,000 bodily injury per accident
• $3,000 property damage liability per accident

You also have the option to add medical payments or uninsured motorist coverage. This costs between $37 and $107 per year. Here are the details:

• $10,000 uninsured motorist bodily injury per person
• $20,000 uninsured motorist bodily injury per accident
• $1,000 medical payments per person

California Low-Income Auto Insurance Restrictions

You can insure up to two vehicles through CLCA. If you own more than two vehicles, you won’t be able to insure any more than two. The program also requires that you only have liability insurance with CLCA and not another provider. If you have another provider for one of your cars, you aren’t eligible for CLCA.

Low-Income Car Insurance NJ

New Jersey offers partial low-income auto insurance under the Special Automobile Insurance Policy (SAIP). This program only offers medical coverage and death benefits for you. It doesn’t offer liability insurance, comprehensive coverage, collision coverage or anything else.

To be eligible for this program, you need to be enrolled in federal Medicaid with hospitalization. The SAIP program is geared toward people who would likely be uninsured because of their financial situation. It costs $365 per year to have SAIP. You make two payments of $182.50, but you get a $5 discount if you pay in full.

New Jersey SAIP Coverage

Here’s what the SAIP program covers:

• Emergency medical treatment immediately following an accident
• Treatment of serious brain and spinal-cord injuries (up to $250,000)
• $10,000 death benefit

Again, this is only medical coverage for you. SAIP won’t cover passengers, other drivers or damage to your car or other cars in accidents you cause.

Low-Income Car Insurance Hawaii

Hawaii offers car insurance assistance under its Assistance to the Aged, Blind, and Disabled (AABD) program. Participants in this program must meet one of the following criteria:

• Over 65 years of age
• Blind
• Disabled

You also have to have countable income below 34% of the 2006 federal poverty level. Finally, your cash resources can’t exceed $2,000 for a single person or $3,000 for a couple.

Having a lower income doesn’t affect your insurance, but it can make it more difficult to find affordable coverage. In the sections below, we’ll go through some tips to help low-income drivers find insurance coverage that fits into a tight budget.

Read More: How To Save On Auto Insurance

Keep a Clean Driving Record

You don’t want to sabotage yourself if you need low-income car insurance. Accidents and tickets on your driving history can raise your insurance rates no matter your income level. By keeping a clean driving record, you’ll find the best rates and also qualify for safe driver discounts.

Read More: What Is A Clean Driving Record?

Read More: What Is A High Risk Driver?

Take a Defensive Driving Course

Many insurers offer discounts to drivers who complete approved defensive driving classes. Even if your provider doesn’t offer a defensive driving discount, the class may help you learn skills that can make you a better driver. If you’re able to improve your driving record, you can qualify for good driver discount.

Consider Usage-Based Insurance

Usage-based programs, also called telematics insurance, track your driving habits and award car insurance discounts based on safe driving. Progressive’s Snapshot^®, State Farm’s Drive Safe & Save™ and Allstate’s Drivewise^® are examples of these kinds of programs. You can also try mileage-based programs like Metromile or Nationwide’s SmartMiles^® if you don’t drive very often.

Read More: What Is Usage-Based Insurance?

Shop Around

Car insurance rates vary widely depending on the provider. To find the best low-income car insurance, be prepared to compare rates from five or more companies. Shop online but also use independent insurance agents and brokers to find every opportunity for cheap coverage.

Improve Your Credit Score

If you have poor credit, it’s worth trying to improve your credit score. If you’re able to pay down debts, make on-time payments for utilities and credit card bills and increase the length of your credit history, you can improve your credit score. Raising your score by even just a few points can help you save money on auto coverage, since the higher your score, the more likely it is to find affordable rates.

Keep in mind that California, Massachusetts, Michigan and Hawaii bar auto insurance companies from using credit to determine rates. If you live in any of these states, you should look at other ways to find cheap car insurance.

Read More: How To Increase Your Credit Score

Cover Small Claims Yourself

According to our averages, a single accident can raise full-coverage insurance rates by about $873 on average. The amount of time an accident stays on your insurance record depends on the state you live in and your provider. If the limit in your area is three years, you could pay an extra $2,619 on average for one accident over that time. If you get into a minor fender bender, consider covering the cost yourself to avoid an increase in rates.

Raise Your Deductible

You can change your car insurance premium by changing your deductible amount. Your car insurance policy will cost less if you raise your deductible because you take on more of the financial risk. But be sure you could afford to pay the deductible if an accident were to happen.

Read More: What Are Car Insurance Deductibles?

Reduce Your Coverage

You can also reduce your insurance coverage to save money if you’re comfortable with that. If you own your car outright, you can drop comprehensive and collision coverage. However, you’ll need to be able to afford to fix or replace your car if you get into an accident. We recommend dropping these coverages if your car is worth $5,000 or less.

Read More: How Much Car Insurance Do I Need?

Choose a Car That’s Cheaper To Insure

If you’re in the market for a new or used car, try to choose one that’s cheap to insure. Generally, smaller used vehicles with safety features are cheapest to insure. They might not be the most thrilling rides, but they’ll help you save money.

Read More: Cheapest Cars To Insure

Read More: Most Expensive Cars To Insure

If you live in California, New Jersey or Hawaii, you may have access to state programs for low-income car insurance. But if you don’t, you can still find affordable auto insurance coverage by following the tips we’ve outlined above. Compare car insurance quotes from multiple companies to find the most affordable option.

Best Car Insurance For Low Income: Top Recommendations

Overall, we recommend State Farm and Geico as two of the best options with affordable coverage for low-income drivers. We’ve ranked all major car insurance companies based cost, coverage, reputation, availability and customer experience. We’ve also surveyed nearly 8,000 customers on their experiences in 2022.

Source: Automoblog

State Farm: Best Customer Service

State Farm is our top pick for its wide variety of coverage options, good discounts and low average rates. State Farm is the country’s largest insurance company and it has a solid industry reputation. In addition to its bundling and good driver discounts, the company also offers a usage-based program called Drive Safe & Save™, which can help drivers save money.

Keep reading: State Farm Insurance Review

Geico: Best for Budget-Conscious Drivers

Geico is among the cheapest car insurance companies for most drivers, including low-income individuals. Our rate averages show Geico’s average prices are about 24% cheaper than the market average. We also found the company tends to offer affordable rates for different types of drivers, such as those with accidents or speeding tickets.

Keep reading: Geico Insurance Review

Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the insurers that scored the most points topping the list.

Here are the factors our ratings take into account:

• Cost: Auto insurance rate estimates generated by Quadrant Information Services and discount opportunities were both taken into consideration.
• Coverage: Companies that offer a variety of choices for insurance coverage are more likely to meet consumer needs.
• Reputation and experience: Our research team considered market share, ratings from industry experts and years in business when giving this score.
• Availability: Auto insurance companies with greater state availability and few eligibility requirements scored highest in this category.
• Customer experience: This score is based on volume of complaints reported by the NAIC and customer satisfaction ratings reported by J.D. Power. We also considered the responsiveness, friendliness and helpfulness of each insurance company’s customer service team based on our own shopper analysis.

Our credentials:

• 800 hours researched
• 45 companies reviewed
• 8,500+ consumers surveyed

*Data accurate at time of publication.