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The Best Cheap Car Insurance Companies for the Average Texas Driver in 2020

Most drivers in Texas will be able to choose from five major car insurance carriers. Those who are members or former members of the U.S. Armed Forces and their families can also choose USAA, which is priced very affordably in Texas.

Insurance cost estimates are averages. Your actual rates may vary significantly based on a variety of factors, including your age and the age of other drivers in your household, driving record, history of DUIs, personal credit score, zip code, your car, the number of miles you drive and whether you drive commercially.

Company
Amount
1. State Farm
In 2020 State Farm ranked #1 in Texas for the cheapest car insurance on average.
$829
per year
2. USAA
In 2020 USAA ranked #2 in Texas for the cheapest car insurance on average.
$971
per year
3. Progressive
In 2020 Progressive ranked #3 in Texas for the cheapest car insurance on average.
$1,139
per year
4. Allstate
In 2020 Allstate ranked #4 in Texas for the cheapest car insurance on average.
$1,301
per year
5. Progressive
In 2020 Progressive ranked #5 in Texas for the cheapest car insurance on average.
$1,418
per year
6. GEICO
In 2020 GEICO ranked #6 in Texas for the cheapest car insurance on average.
$1,469
per year

Each carrier underwrites these factors differently. Some may place a higher risk premium on DUIs or prior speeding tickets than others. Some companies may offer discounts for a good driving record, for a high school student with good grades, or for your vehicle's safety features. It pays to shop around.

The Best Car Insurance Companies in Texas for 2020

MoneyGeek used a combination of factors, including customer satisfaction, affordability, claims experience and financial strength, to determine the best car insurance companies in Texas.

Expand all Rankings +

1

USAAScore: 100
+

5/5

User Satisfaction

5/5

Claims Ratings

5/5

Affordability

A++

Financial Stability

2

GEICOScore: 85
+

3/5

User Satisfaction

3/5

Claims Ratings

3/5

Affordability

A++

Financial Stability

3

State FarmScore: 85
+

3/5

User Satisfaction

3/5

Claims Ratings

3/5

Affordability

A++

Financial Stability

4

AAAScore: 85
+

3/5

User Satisfaction

2/5

Claims Ratings

5/5

Affordability

A+

Financial Stability

5

AllstateScore: 80
+

3/5

User Satisfaction

2/5

Claims Ratings

3/5

Affordability

A+

Financial Stability

6

ProgressiveScore: 80
+

2/5

User Satisfaction

3/5

Claims Ratings

3/5

Affordability

A+

Financial Stability

7

NationwideScore: 80
+

3/5

User Satisfaction

3/5

Claims Ratings

2/5

Affordability

A+

Financial Stability

8

FarmersScore: 77.5
+

3/5

User Satisfaction

3/5

Claims Ratings

2/5

Affordability

A

Financial Stability

9

Liberty MutualScore: 72.5
+

2/5

User Satisfaction

2/5

Claims Ratings

2/5

Affordability

A

Financial Stability


To arrive at our score for each criterion, MoneyGeek assessed information from both JD Power's U.S. Auto Insurance Study and AM Best's financial strength ratings the industry standards for insurance company ratings and review.
Each study was ranked equally to formulate MoneyGeek's final rating out of 100.

Market Share by Company

If you're looking for a combination of service, pricing and knowledge that matches your needs, you may want to consider getting a quote from one of the largest insurance companies in Texas. With 14.99% of the market share in the state, State Farm is the largest auto insurance carrier in Texas.

Company
Market Share
1. State Farm
14.99%
2. GEICO
13.10%
3. Allstate
11.65%
4. Progressive
11.18%
5. USAA
8.44%
6. Farmers
8.17%
7. Liberty Mutual
5.21%
8. Texas Farm Bureau Group
3.26%
9. CONSUMERS CNTY MUT INS CO
2.55%
10. Nationwide
1.78%

Cheapest Car Insurance for Drivers With a DUI in Texas

Those convicted of driving under the influence in Texas face jail terms of 3 days to six months, and a mandatory license suspension of 90 days to a year. There are also direct fines and fees of up to $2,000. If it's your second offense, that fine could go as high as $4,000. And if it's your third offense, or if there is a minor child in the car, your fine in Texas could run as high as $10,000.

Company
Amount
1. USAA
In 2020 USAA ranked #1 in Texas for the cheapest car insurance for dui.
$1,401
per year
2. State Farm
In 2020 State Farm ranked #2 in Texas for the cheapest car insurance for dui.
$1,405
per year
3. Progressive
In 2020 Progressive ranked #3 in Texas for the cheapest car insurance for dui.
$1,973
per year
4. Progressive
In 2020 Progressive ranked #4 in Texas for the cheapest car insurance for dui.
$2,008
per year
5. Allstate
In 2020 Allstate ranked #5 in Texas for the cheapest car insurance for dui.
$2,143
per year
6. GEICO
In 2020 GEICO ranked #6 in Texas for the cheapest car insurance for dui.
$2,600
per year

On average, a Texas driver with a DUI record and a 100/300 policy (covering $100,000 for injuries sustained by a single person and up to $300,000 total per accident) can expect to pay $2,336.53 per year for auto insurance, according to MoneyGeek's analysis. That's much more than the $1,443 average throughout the State of Texas for a similar policy. The costs of a DUI can last for years in terms of insurance premiums, legal fees and education expenses and more.

Cheapest Car Insurance For Drivers With a Speeding or Distracted Driving Ticket in Texas

Moving violations can negatively impact your auto insurance premiums. In 2018, the National Highway Traffic Safety Administration reported 3,305 accidents involving distracted driving in Texas, making this infraction a serious indicator of accident potential for insurers.

Company
Amount
1. State Farm
In 2020 State Farm ranked #1 in Texas for the cheapest car insurance for distracted drivers.
$878
per year
2. USAA
In 2020 USAA ranked #2 in Texas for the cheapest car insurance for distracted drivers.
$1,041
per year
3. Allstate
In 2020 Allstate ranked #3 in Texas for the cheapest car insurance for distracted drivers.
$1,384
per year
4. GEICO
In 2020 GEICO ranked #4 in Texas for the cheapest car insurance for distracted drivers.
$1,559
per year
5. Progressive
In 2020 Progressive ranked #5 in Texas for the cheapest car insurance for distracted drivers.
$1,957
per year
6. Progressive
In 2020 Progressive ranked #6 in Texas for the cheapest car insurance for distracted drivers.
$2,380
per year

On average, annual car insurance premiums in Texas with a single conviction for speeding or distracted driving increase by an average of $274.10.

Cheapest Car Insurance Companies in Texas for Drivers With Bad Credit

Many insurance companies note an increase in claims among people with poor credit scores. In fact, it was a 2003 University of Texas study commissioned by then-Lieutenant Governor Bill Ratliff that established a significant inverse correlation between credit scores and claims for the insurance industry.

Texas is among the states that allow insurers to use credit scores as one factor to set premiums. With an average credit score of 680 according to Experion, Texans rank 48th in the nation for good credit, which means that many may be paying more for auto insurance.

Company
Amount
1. State Farm
In 2020 State Farm ranked #1 in Texas for the cheapest car insurance for poor credit history drivers.
$806
per year
2. USAA
In 2020 USAA ranked #2 in Texas for the cheapest car insurance for poor credit history drivers.
$966
per year
3. Progressive
In 2020 Progressive ranked #3 in Texas for the cheapest car insurance for poor credit history drivers.
$1,131
per year
4. Allstate
In 2020 Allstate ranked #4 in Texas for the cheapest car insurance for poor credit history drivers.
$1,339
per year
5. Progressive
In 2020 Progressive ranked #5 in Texas for the cheapest car insurance for poor credit history drivers.
$1,434
per year
6. GEICO
In 2020 GEICO ranked #6 in Texas for the cheapest car insurance for poor credit history drivers.
$1,484
per year

If your credit score has been negatively affected because of identity theft or a specific life event beyond your ordinary control, you may qualify for an exception to credit underwriting. Examples include job loss, divorce, the death of an immediate family member and the like. To request an exemption, simply submit the request to the insurance company in writing, along with documentation.

Once the carrier has your request and documentation, and the request meets state requirements, the carrier can only consider credit information not related to the negative life event, or they must assign a neutral credit score.

If you believe your request for a credit underwriting exception was improperly denied, you can visit the Texas Department of Insurance Complaint Process web page to file a complaint.

Cheapest Car Insurance Companies in Texas for Seniors

In Texas, older drivers are subject to increased safety laws and regulations. According to the Texas Department of Public Safety, drivers between the ages of 79 and 84 must renew their license in person every six years, while drivers aged 85 and older are required to renew every two years.

Senior drivers are not only required to participate in more regular license renewals and screenings, but they often pay higher insurance rates in Texas. But not all companies start increasing premiums at the same age. Some hike rates at age 65, while others wait until age 70 or even later. As you age, it pays to shop around every few years for affordable car insurance for seniors.

Company
Amount
1. State Farm
In 2020 State Farm ranked #1 in Texas for the cheapest car insurance for seniors.
$805
per year
2. USAA
In 2020 USAA ranked #2 in Texas for the cheapest car insurance for seniors.
$1,165
per year
3. Progressive
In 2020 Progressive ranked #3 in Texas for the cheapest car insurance for seniors.
$1,272
per year
4. Allstate
In 2020 Allstate ranked #4 in Texas for the cheapest car insurance for seniors.
$1,532
per year
5. Progressive
In 2020 Progressive ranked #5 in Texas for the cheapest car insurance for seniors.
$1,691
per year
6. GEICO
In 2020 GEICO ranked #6 in Texas for the cheapest car insurance for seniors.
$1,764
per year

If you're an older driver, you may be able to offset some or all of the higher premiums in several ways, including taking a defensive driving course.Texas drivers can save up to 15% on their car insurance premiums by taking a defensive driving course. Details vary depending on your carrier. Approved courses include Defensive Driving by the National Safety Council, American Safety Council or IMPROV

Cheapest Car Insurance for Students

Texas Car Insurance: How Much a Teen Driver Will Cost You

Median annual price change for families with a teen driver on their policy:

$1,969 INCREASE

This is a difference of 130%.

Younger drivers, including high school and college-aged drivers, are considered a higher-risk group. Teen drivers are especially accident prone, and insurance rates reflect this

However, some carriers are friendlier than others when it comes to setting rates for drivers in their teens and early 20s. Rates for this group vary substantially. It pays to shop around especially right before a teen driver goes to college or owns his or her first car.

If you're a parent or guardian, you should also explore adding your child to your insurance policy as an additional driver, rather than having them get their own separate policy. Whether you are a parent of a young driver, or you're a young driver buying your own coverage, you may be able to get a break on your premiums.


Company
Amount
1. USAA
In 2020 USAA ranked #1 in Texas for the cheapest car insurance for students.
$1,463
per year
2. Progressive
In 2020 Progressive ranked #2 in Texas for the cheapest car insurance for students.
$2,333
per year
3. State Farm
In 2020 State Farm ranked #3 in Texas for the cheapest car insurance for students.
$2,430
per year
4. GEICO
In 2020 GEICO ranked #4 in Texas for the cheapest car insurance for students.
$2,534
per year
5. Progressive
In 2020 Progressive ranked #5 in Texas for the cheapest car insurance for students.
$2,729
per year
6. Allstate
In 2020 Allstate ranked #6 in Texas for the cheapest car insurance for students.
$4,352
per year

Maintain a safe driving record, protect and improve your credit score, and drive a vehicle with safety features installed. Stick to sensible sedans, SUVs, vans and trucks these are cheaper to insure than sports cars.

You may also get a discount for bundling multiple policies within your family at the same company.

Increasing your deductible is another good way of saving money on premiums as long as you can afford the deductible if you have a claim.

If you're a Texan going to school in another state and taking your car with you, notify your insurance company as soon as possible. The agent can help you be sure that your policy matches the insurance requirements of your new state.

The Problem of Distracted Teen Driving

In 2018, there were more than 540,000 car accidents on Texas roadways, with 95,572 of them about 18% attributable to distracted driving, according to the Texas Department of Transportation. These are accidents that are due to things like texting while driving, cell phone use, etc. These distracted driving-related accidents were responsible for 394 deaths and 2,340 serious injuries.

Distracted driving is such a problem among young Texans that the Texas Department of Safety created an eight-part video about it. Called IMPACT Texas Teen Drivers (ITTD), the series explores the dangers of distracted driving through real-life stories of teens who died from texting, talking on cell phones and otherwise multitasking while driving. "It's not about bad kids doing bad things, but about good kids making poor choices," the department states. It's now a required part of every driver's education class for teens in Texas.

The insurance department also reminds drivers that some policies require all covered drivers to be named on the policy, so tell your insurance agent as soon as your child turns 16. Otherwise, the TDI warns, "if you don't have all the drivers in your family listed on the policy and the company learns about them later because of an accident claim, for instance the company may bill you for the extra premium you should have paid, deny your claim and coverage, or refuse to renew your policy in the future."

Premium Comparison by Student Type

No matter how much your teen or college student wants a sports car, insurers advise you to just say no. Sedans and minivans are a safer choice, and your annual premiums will likely be much lower.

Premium comparison for two adults + 16-year-old

car
Average premium for two 2014

Mustang GTs

$6,164
car
Average premium for two 2008

Town and Country Limiteds

$3,536
Anual benefits of minivans:$2,628 saved

This is 43% less expensive.

Cheaper premium for college vs. high school drivers

Median premium change with a college student vs. high school driver:

$787 DECREASE

This is a savings of 21%.

Potential discounts for teens in texas

Impact on annual premium with good student and defensive driving discounts:

coins
$522 SAVED

Texas students: a long-distance discount

You may pay a smaller annual family premium if your child lives 150 miles or more away from home.

male
Average premium for a 19-year-old male
car

$4,041 at home

graduation

$3,471 at school

$570 IN SAVINGS

female
Average premium for a 19-year-old female
car

$3,606 at home

graduation

$3,158 at school

$448 IN SAVINGS



Insurance Rate Information for Military Drivers and Veterans

Texas has more than 110,913 active duty personnel, more than 53,321 reservists and Guardsmen, and more than 1,460,000 veterans, according to Governing and the Texas Workforce Investment Council. Vets living in the Lone Star State may be eligible for military discounts on regular auto insurance. They may also be eligible for a USAA membership. Shop around for the best rates available to veterans, bearing in mind that a military discount also requires a good driving record.

Active-duty servicemen and women leaving Texas temporarily should check with their insurance company before they depart. Some companies allow veterans to suspend their auto insurance coverage while a vehicle is not in use.

Age savings for Texas service members

male
25 years$1,608
50 years$1,203
female
25 years$1,539
50 years$1,200

$405 Saved
$339 Saved

Median auto insurance for service members: $1.243

Who Needs Car Insurance in Texas?

If you own or operate a motor vehicle in Texas, you need to show that you are financially capable of covering any damage you or the driver of your vehicle may cause. State law requires that insurance must be carried for all vehicles (except semi-trailers and trailers) that are registered for on-road use.

The Texas Transportation Code outlines one exception to the rule: You can avoid the requirement for insurance if you deposit at least $55,000 in cash or eligible securities with the State Comptroller, or a cashier’s check with the county judge. For more information, see the section “Alternatives to Car Insurance in the State of Texas,” below.

Proof of Insurance in Texas

Drivers in the state must provide proof of insurance or alternative documentation (see below). According to the Texas Department of Motor Vehicles, you are required to show proof of insurance in several circumstances:

  • When asked for it by a police officer
  • When involved in a car accident
  • When registering and renewing a vehicle registration
  • When applying for and renewing a driver's license

Auto insurers are required to send policyholders an insurance card. Individuals relying on insurance alternatives will receive certificates in lieu of an insurance card. You can carry your card on your smartphone.

Minimum Liability Insurance Requirements in Texas

Drivers in Texas are required to post a $55,000 bond, or purchase and carry liability insurance. Collision and comprehensive coverage are optional, unless you financed the car, in which case the lender will probably require such coverage as a condition of the loan. But even if you own the car outright, liability coverage is a must. As of 2020, the minimum mandatory coverage limits outlined by the Texas Department of Insurance are:

  • $30,000 for each injured person per accident
  • Up to a total of $60,000 per accident
  • $25,500 for property damage per accident

A policy with this minimum level of insurance coverage is referred to as "30/60/25 coverage."

Note that these are just the statutory minimums. At a time when cars and medical care are both getting more expensive, the minimum amount may not be enough to cover the entire cost of the accident. Most insurance and consumer groups recommend drivers carry up to 10 times the state's minimum in liability coverage.

High-Risk Auto Insurance Program in Texas

Individuals who don't qualify for liability insurance through traditional channels may be able to obtain coverage through the Texas Automobile Insurance Plan Association. To qualify, applicants must meet these requirements:

  • Have a valid driver's license
  • Be a resident of Texas or have a vehicle registered in Texas
  • Certify that insurance coverage has been denied by two or more insurance companies within the past 60 days

Alternatives to Insurance in Texas

Under Texas law, uninsured residents may legally drive if they can present proof of financial responsibility. According to the Texas Transportation Code, approved alternatives to car insurance in Texas include:

  • A $55,000 cash or securities deposit with the state comptroller
  • A $55,000 cash or cashier's check deposit with the county judge
  • A surety bond filed with Texas Department of Public Safety

In each instance, drivers who opt for this alternative must carry a certificate of deposit or a surety bond deposit in lieu of an insurance card.

What Happens If You Don't Have Car Insurance in Texas?

Research presented by the National Association of Insurance Commissioners shows that most uninsured motorists do not have car insurance because they cannot afford it (or, in the case of illegal immigrants, are not allowed to buy it). Texas slaps uninsured motorists with stiff penalties. Motorists caught without insurance or a valid alternative can face the following consequences:

  • First offense: $175 to $350 fine
  • Second offense: $350 to $1,000, two-year suspension of driver's license and car impoundment
  • Driving without a driver's license: Up to $2,000 fine and/or 180 days in jail.

Texas has also launched TexasSure, an automated database that identifies drivers who do not have mandatory insurance coverage. This program notifies drivers who have allowed their coverage to lapse.

Car Insurance Requirements in Texas: How Much Coverage Do You Need?

What percentage of drivers in Texas lack vehicle insurance?

14.1%

National average: 13%

Source:

Insurance Information Institute.

Many drivers should strongly consider buying insurance that goes beyond the minimum levels of protection. A 100/300 liability policy, one that covers $100,000 for a single person in an accident and $300,000 for individuals in an accident, will be much more likely to protect you, according to the Insurance Information Institute. A 2017 MoneyGeek analysis found that adding another $100,000 in liability protection generally costs no more than $30 a month.

Insurance companies in the state offer a Texas Personal Automobile Policy, a standardized policy that offers eight types of insurance in one policy. But because exclusions vary from policy to policy, the Texas Office of Public Insurance Counsel recommends drivers know exactly who and what is covered.

It's also good to check up on the insurance company you're dealing with. The Texas Insurance Department advises you to find out about a company's license, history of complaints and financial rating by calling TDI's Consumer Help Line at 1-800-252-3439. Or, visit the website at www.tdi.texas.gov.

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Sources