Best Low-Income Car Insurance Company

State Farm is MoneyGeek's top choice for low-income car insurance. For individuals with lower credit scores, Nationwide might offer the best rates. In the majority of states, State Farm stands out as the top insurer for low-income drivers.

MoneyGeek found that, on a national level, State Farm offers the best liability-only car insurance for low-income drivers:

• State Farm: MoneyGeek Score of 88 out of 100 ($409 per year)
• GEICO: MoneyGeek Score of 88 out of 100 ($424 per year)

State Farm offers a variety of discounts to low-income drivers, including discounts for good student drivers, drivers with multiple vehicles, and drivers who have taken a defensive driving course. State Farm also offers a low-mileage discount for drivers who don't drive very much.

When searching for low-cost car insurance, be wary of providers that offer cheap rates at the expense of service quality. The best insurance provider for you will depend on factors like your driving profile, habits, and location. Each insurer has its method for setting premiums, so you might get different quotes from various agents.

MoneyGeek evaluated car insurance options by considering customer satisfaction, affordability, coverage depth, claims processing, and company stability. Based on our research, we've identified companies that offer both affordability and quality service.

MoneyGeek found that Travelers and GEICO offer the best car insurance for low-income drivers with poor credit:

• Travelers: MoneyGeek Score of 91 out of 100 ($908 per year)
• GEICO: MoneyGeek Score of 90 out of 100 ($696 per year)

Your income doesn't determine your insurance score. However, your credit score does. Where you reside, which can sometimes correlate with your income level, also influences your insurance costs.

But here's some good news for those with poor credit: There are proactive steps you can take to manage costs. By maintaining a clean driving record and taking advantage of available discounts, you can make a positive impact on your premiums. And with sound financial decisions and time, your credit score has the potential to improve, which could lead to more favorable insurance rates.

MoneyGeek found that State Farm offers the best low-income car insurance across 16 states. Auto-Owners Insurance ranks second with the best offering across eight states.

The state you reside in plays a pivotal role in your car insurance costs. Each state has its own insurance regulations and minimum coverage requirements, which can directly influence premiums. For instance, no-fault states might have different rates than those using a "tort" system. Additionally, areas with higher risks, be it due to more accidents, thefts, or natural disasters, often see elevated rates.

When hunting for the cheapest car insurance in your state, you should compare the same coverage across different insurers. Different coverage levels can drastically affect the price, so ensure you're looking at identical policies to see which is the most cost-effective.

Non-owner and pay-per-mile car insurance can offer cost-effective ways to stay insured. By aligning insurance costs more closely with actual vehicle usage, these options can be more affordable and tailored to individual needs.

Some states, like California and Hawaii, offer more ways to get car insurance for low-income drivers.

• California: The state offers the Low-Cost Automobile Insurance Program (CLCA) for good drivers within 250% of the federal poverty limit. It provides liability insurance for primary and eligible secondary drivers of cars valued at less than $25,000. The coverage limits are 10/20/3.
• New Jersey: The Special Automobile Insurance Policy (SAIP), known as the dollar-a-day program, provides medical-only coverage for low-income drivers enrolled in federal Medicaid with hospitalization. It covers emergency medical treatment up to $250,000 and offers a $10,000 death benefit.
• Hawaii: The Assistance to the Aged, Blind, or Disabled (AABD) program provides financial assistance for auto insurance to those 65 or older, legally blind individuals, permanently disabled individuals, or those living with or caring for an AABD recipient. Eligible individuals get free auto insurance if their income is below 34% of the Federal Poverty Level.
• Maryland: While not specifically for low-income drivers, the Maryland Automobile Insurance Fund caters to drivers rejected by private insurers due to reasons like poor credit, traffic violations, or being high-risk.

Eligibility rules for these state-funded car insurance programs can change frequently. So, if you're considering tapping into these resources, it's a smart move to check in with your local offices regularly.

If you are a low-income driver in need of assistance, these programs offer an affordable route to meet state-mandated minimum car insurance requirements without straining your finances.

To help you make an informed purchase, MoneyGeek answers common questions about the best providers for low-income car insurance.