Cheapest Car Insurance With No Deposit (October 2024)


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Updated: October 1, 2024

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Key Takeaways

MoneyGeek found that GEICO, State Farm and Nationwide provide the cheapest no-deposit insurance for those who want to keep the initial premium payment low.

Insurers require an upfront payment for a small portion of the policy, often a payment for one month of insurance. This isn't exactly deposit, but rather a partial payment for your policy.

Many insurers offer payment discounts, flexible terms and affordable rates, allowing drivers to activate their coverage cheaply. Car insurance companies may even lower your first payment.

Why Trust MoneyGeek? To find the cheapest no-deposit car insurance, we gathered quotes from Quadrant Information Services and state insurance departments and sorted rates from providers that offer monthly payment plans.

83,056Quotes Analyzed
 
46Companies Compared
 
473 ZIP Codes

Cheapest No-Deposit Liability-Only Car Insurance

State Farm and GEICO are the cheapest liability-only car insurance options that don't require a deposit. However, you will pay for your first month when the policy starts.

  • State Farm: $524 per year; $44 per month
  • GEICO: $527 per year; $44 per month

When you're looking for the cheapest car insurance policy, you may be able to save money by getting liability-only coverage. This kind of car insurance doesn't cover your car's damage, but it does cover any damage to other vehicles if you're in an at-fault accident. The table below shows the cheapest national average rates for a liability-only policy.

State FarmAnnual Premium$524Monthly Premium$44
GEICOAnnual Premium$527Monthly Premium$44
NationwideAnnual Premium$538Monthly Premium$45
ProgressiveAnnual Premium$542Monthly Premium$45
TravelersAnnual Premium$544Monthly Premium$45
FarmersAnnual Premium$667Monthly Premium$56
AllstateAnnual Premium$756Monthly Premium$63
Compare Auto Insurance Rates

Ensure you're getting the best rate for your auto insurance. Compare quotes from the top insurance companies.

Cheapest No-Deposit Full Coverage Car Insurance

MoneyGeek found that Nationwide and Travelers have the cheapest full-coverage policies, on average. Almost every state requires you to have at least liability insurance on your car. However, if you have a car loan or lease, the financing company will require you to carry full coverage car insurance.

  • Nationwide: $1,044 per year and $87 per month
  • Travelers: $1,107 per year and $92 per month

In most cases, the cheapest full coverage insurance is still more expensive than cheap liability-only insurance. However, it offers more coverage and better financial protection. Full coverage insurance includes collision — which covers any damages to your car from an accident — and comprehensive protection — which covers damage to your vehicle caused by theft, vandalism, fire and weather.

NationwideAnnual Premium$1,044Monthly Premium$87
TravelersAnnual Premium$1,107Monthly Premium$92
GEICOAnnual Premium$1,154Monthly Premium$96
State FarmAnnual Premium$1,187Monthly Premium$99
ProgressiveAnnual Premium$1,273Monthly Premium$106
AllstateAnnual Premium$1,395Monthly Premium$116
FarmersAnnual Premium$1,427Monthly Premium$119

Which Companies Offer No-Deposit Monthly Payment Plans?

Most car insurance companies offer flexible payment plans, which means you can pay monthly. MoneyGeek spoke our the three cheapest no-deposit car insurance providers and learned the following:

  • All required some form of initial payment, but this payment was applied to paying for a portion of the policy rather than being held as a deposit.
  • The providers offering the cheapest rates offered flexible initial payment options and required partial policy payments as low as $20 to start the policy depending on your state.

The three providers below offer the cheapest rates with no deposit for multiple coverage options. They are all rated among the best for customer service, affordability and a variety of discounts and product options.

Nationwide

MoneyGeek's Experience

  1. Nationwide offers low down payment options for new policyholders, helping to reduce the initial cost when starting or renewing a policy.
  2. Customers can change their billing date to fit their financial schedule. This feature benefits those who need to align their payments with paydays or other recurring expenses.
  3. Nationwide also offers a program called SmartRide, which can lower your payments based on your driving habits. This is not a traditional payment plan but makes payments more affordable over time.
State Farm

MoneyGeek's Experience

  1. State Farm offers a flexible payment plan that sometimes includes lower first-month payments, depending on the specific plan and state regulations.
  2. Instead of requiring a large upfront payment, it allows customers to make a smaller initial payment and spread the remaining balance over time through monthly installments.
  3. State Farm also accepts various payment methods — including credit cards, bank transfers and electronic payments — giving customers even more flexibility.
GEICO

MoneyGeek's Experience

  1. When we called customer service, we found that GEICO offers a low down payment option for new policies. This option is applied to the payment of your policy, reducing the initial cost when signing up for coverage.
  2. GEICO allows customers to spread out the payments over time with monthly or bimonthly installment plans. This reduces the immediate financial burden and spreads costs across the policy period.
  3. Customers can easily manage their payment schedules and make one-time payments through the GEICO Mobile app. This provides flexibility for those wanting to adjust payment schedules or make additional payments.

How No-Deposit Car Insurance Works

Credible car insurance companies require payment to activate a policy, usually the first month of coverage. Here's how it works:

  1. Choose your policy type and coverage. You'll need to choose liability-only or full coverage, as well as whatever liability limits and deductible you want. Even if you opt for liability-only, you'll still need at least state minimum limits for your policy.
  2. Make the first month's payment to activate your policy. This first payment is not an additional fee you pay on top of your premium but goes toward the total cost of your policy.
Payment Structure
Total Policy Cost

Low Down Payment

If you choose a low down payment plan and the total cost of your policy is $720, you would only need to pay $60 upfront to get insured, and you'd make the same payment each month for a full year.

Standard Policy Paid in Full

If you can pay in full, the same $720 no-deposit policy may only cost $684 per year with the annual payment discount. You would make one initial payment of $684 with no following monthly payments, and you'd save $36.

Payment Options for No-Deposit Car Insurance

No-deposit car insurance means that you are only responsible for paying for the first month of your car insurance policy, but you are not required to give a separate deposit. This initial payment can be as low as $20.

Insurance companies offer various payment plans to spread out costs:

  • Annually: Pay the entire premium once a year
  • Semi-Annually: Split the payment into two installments per year
  • Quarterly: Pay every three months
  • Monthly: Make payments each month

Be cautious of "no-money-down" promotions, as some payment is usually necessary for immediate coverage.

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TIPS FOR GETTING CHEAP CAR INSURANCE
  1. Choose the cheapest insurance provider with flexible payment options.
  2. Ask the insurer to lower the initial payment for the first month and distribute the remaining amount over the policy's term, offering a more affordable start.
  3. If you have a low-value car and don't need full coverage, consider shopping for the cheapest liability-only insurance.

Explore the options below to find the cheapest car insurance based on your profile and needs:

One of the fastest ways to compare rates based on your profile and price range is our car insurance calculator. Our calculator lets you anonymously enter basic information to get a quick view of how rates may stack up for you.

Compare Auto Insurance Rates

Ensure you're getting the best rate for your auto insurance. Compare quotes from the top insurance companies.

Why Insurers Ask for the First Month

The first month's payment acts as the policyholder's financial commitment, signaling their intention to maintain the coverage. It establishes a concrete agreement between the insurer and the insured.

It also serves to mitigate the insurer's risk. By receiving an upfront payment, the insurance company ensures it does not extend coverage without securing payment first. This approach effectively reduces the risk of future non-payment, protecting the insurer's financial stability.

How to Lower Your First Car Insurance Payment

Getting car insurance with initial payment isn't technically possible, but you can take steps to get the lowest possible down payment even if you've had trouble with your credit, past accidents or moving violations. The most important thing is to shop around, get several quotes and look for a monthly payment you can afford. Drivers with stellar driving records could even find a policy with a $20 down payment.

1
Shop around for the best rates

MoneyGeek estimates you can save up to 49% when you shop around. Different companies offer varying rates based on their assessment of risk, so shopping around can lead to significant savings.

We recommend shopping car insurance quotes from at least three companies to make a fair comparison. Also, consider which company’s customers have had fewer complaints from the National Association of Insurance Commissioners. The last thing you need after a car accident is subpar customer service.

2
Opt for higher deductibles

Raising your collision and comprehensive deductibles from $200 to $500 could save you 15% to 30%, and increasing each deductible to $1,000 could save as much as 40%. Just make sure you put aside enough money to cover the deductible if your car is damaged.

3
Improve your credit history

Having poor credit can DOUBLE your insurance rate. Making payments on time, managing your credit wisely and keeping balances as low as possible can help you save money on car insurance. Insurers see those with good credit as less risky than those with poor credit histories.

4
Bundle policies

Purchasing multiple insurance policies from the same provider, such as auto and home insurance, can often lead to discounts on down payments and overall premiums. For example, buying a home and auto bundle from the same insurer could save you up to 25%, depending on the company.

5
Choose a vehicle that's cheap to insure

Driving a car that's less expensive to insure can reduce your down payment. Cars that are cheaper to repair or have better safety ratings typically have lower insurance costs.

High-performance sports cars and luxury cars are more expensive to insure. SUVs are usually less expensive. Take note of safety features — options like adaptive cruise control and lane detection assist can lower insurance costs.

6
Drive safely and maintain a clean record

A clean driving record with no accidents or violations can qualify you for lower insurance rates. Insurers reward safe drivers with lower premiums and down payments.

7
Seek out discounts

Many insurance companies offer a variety of car insurance discounts, such as for being a student, a safe driver or for installing anti-theft devices. Always inquire about available discounts to reduce your down payment.

FAQ: No-Deposit Insurance

Whether you want to make monthly payments less expensive or find the cheapest car insurance rates, learn more with frequently asked questions and answers about no-deposit car insurance.

Can you get car insurance with no deposit?
Who actually has the cheapest car insurance?
How do I get insurance with no money down?
Can I pay half my car insurance?

About Mark Fitzpatrick


Mark Fitzpatrick headshot

Mark Fitzpatrick is a Licensed Property and Casualty Insurance Producer and MoneyGeek's Head of Insurance. He has analyzed the insurance market for over five years, conducting original research and creating personalized content for every kind of buyer. He has been quoted in several insurance-related publications, including CNBC, NBC News and Mashable.

Fitzpatrick earned a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He is passionate about using his knowledge of economics and insurance to bring transparency around financial topics and help others feel confident in their money moves.


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