Updated: May 23, 2025
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State Farm and GEICO offer some of the cheapest car insurance for low-income drivers, with average premiums of $409 and $424 annually, respectively.
California, New Jersey and Hawaii have state-funded programs with specific eligibility requirements to help low-income drivers access affordable car insurance.
Low-income drivers can save by purchasing enough insurance to cover their risks and avoiding coverages they don’t need.
Overall we found that the cheapest low-income car insurance for military background drivers is offered by USAA with low average rates of $24 per month for minimum coverage. However, for most drivers, State Farm is the most affordable option with monthly rates on average of $34.
| USAA | $24 | $283 |
| State Farm | $34 | $409 |
| GEICO | $35 | $424 |
| Nationwide | $38 | $462 |
| Travelers | $42 | $504 |
| Progressive | $43 | $514 |
| Farmers | $48 | $572 |
| Allstate | $50 | $604 |
*These rates are based on a 40-year-old driver with good credit and no driving violations.
State Farm is the most affordable widely available insurer, ranking cheapest in 15 states (excluding USAA). GEICO offers the lowest rates in five states, while Erie and American National each rank cheapest in four states. Below you can review which provider is cheapest in your area.
| Alabama | Cincinnati Insurance | $201 |
| Alaska | State Farm | $322 |
| Arizona | Mercury | $305 |
| Arkansas | State Farm | $232 |
| California | GEICO | $419 |
| Colorado | American National P&C | $216 |
| Connecticut | GEICO | $319 |
| Delaware | Travelers | $464 |
| District of Columbia | GEICO | $372 |
| District of Columbia | Chubb | $372 |
| Florida | GEICO | $485 |
| Georgia | Auto-Owners Insurance Co | $311 |
| Hawaii | GEICO | $217 |
| Idaho | American National P&C | $127 |
| Illinois | Mercury | $226 |
| Indiana | Auto-Owners Insurance Co | $228 |
| Iowa | State Farm | $144 |
| Kansas | Nationwide | $221 |
| Kentucky | Cincinnati Insurance | $257 |
| Louisiana | Louisiana Farm Bureau | $484 |
| Maine | Countryway Insurance | $221 |
| Maryland | Kemper | $538 |
| Massachusetts | State Farm | $221 |
| Michigan | Travelers | $101 |
| Minnesota | Westfield | $317 |
| Mississippi | Direct General Insurance | $275 |
| Missouri | State Farm | $388 |
| Montana | State Farm | $168 |
| Nebraska | American National P&C | $138 |
| Nevada | CSAA | $444 |
| New Hampshire | State Farm | $247 |
| New Jersey | GEICO | $428 |
| New Mexico | State Farm | $254 |
| New York | Kemper | $464 |
| North Carolina | Nationwide | $242 |
| North Dakota | Nodak Mutual | $190 |
| Ohio | Erie | $176 |
| Oklahoma | State Farm | $215 |
| Oregon | State Farm | $381 |
| Pennsylvania | Erie | $238 |
| Rhode Island | State Farm | $344 |
| South Carolina | American National P&C | $251 |
| South Dakota | Farmers Mutual of Nebraska | $207 |
| Tennessee | Auto-Owners Insurance Co | $207 |
| Texas | State Farm | $321 |
| Utah | Farmers Union Insurance | $388 |
| Vermont | State Farm | $198 |
| Virginia | American Family | $243 |
| Washington | PEMCO | $262 |
| West Virginia | Erie | $303 |
| Wisconsin | Erie | $230 |
| Wyoming | GEICO | $176 |
*These rates are based on a 40-year-old driver with good credit and no driving violations. In Washington, D.C., two insurers tie for the lowest premium. USAA is typically the most affordable option for military families and offers the lowest rates in 38 states for eligible customers.
Below we've summarized state provided car insurance programs for low-income drivers:
State Program | Eligibility Requirements | Coverage and Cost Details |
|---|---|---|
California's Low-Cost Automobile Insurance Program (CLCA) | Good drivers within 250% of the federal poverty limit may qualify for this program. To qualify, you must:
| Liability coverage limits are 10/20/3, meaning $10,000 bodily injury liability per person, $20,000 bodily injury liability per accident and $3,000 property damage liability per accident. Costs vary widely depending on county ranging anywhere from $244 - $966 annually. |
New Jersey's Special Automobile Insurance Policy (SAIP) | To qualify, you must be enrolled in federal Medicaid with hospitalization. | The SAIP covers emergency medical treatment up to $250,000 after a car crash. It also provides a $10,000 death benefit if the accident is fatal. It doesn't provide liability insurance or cover doctor's visits beyond initial treatment, but this covers minimum requirements for the state. Rates are $1 per day or $30 a month. |
Hawaii's Aid to the Aged, Blind and Disabled Program (AABD) | You must meet one of these requirements:
| Only minimum liability bodily injury car insurance coverage is provided, which has $20,000 per person/$40,000 per accident limits. If you qualify, auto insurance is free. |
Maryland Automobile Insurance Fund | Drivers can qualify if they:
| This program offers coverages that satisfy minimum requirements of $20,000/ $40,000 bodily injury, $15,000 property damage, and $2,500 economic loss coverage. |
Some nonprofit initiatives and insurer-led discount programs help low-income drivers find affordable car insurance. Availability and eligibility requirements differ by location, so research what's available in your area.
On average you can expect car insurance for low-income drivers to be around $503 per year for minimum coverage and $1,056 annually for full coverage. However, rates can vary anywhere from $253 to $2,078 annually on average depending on your location and coverage level chosen.
Coverage Category | Average Monthly Premium | Average Annual Premium | Average Annual Cost Range |
|---|---|---|---|
Minimum Coverage | $42 | $503 | $253-$1,170 |
Full Coverage | $88 | $1,026 | $661-$2,078 |
*Rates presented are based on a 40-year-old driver with good credit and no driving violations.
Drivers with the federal low-income designation of $20,385 spend about 2% of their income on a GEICO state minimum policy. Someone earning the median household income of $70,784 pays just 0.6% for the same coverage.
| Alabama | $365 | $859 |
| Alaska | $426 | $892 |
| Arizona | $522 | $1,096 |
| Arkansas | $382 | $931 |
| California | $599 | $1,378 |
| Colorado | $443 | $998 |
| Connecticut | $703 | $1,345 |
| Delaware | $1,017 | $1,708 |
| District of Columbia | $552 | $1,208 |
| Florida | $803 | $1,627 |
| Georgia | $459 | $933 |
| Hawaii | $363 | $816 |
| Idaho | $303 | $661 |
| Illinois | $390 | $924 |
| Indiana | $354 | $733 |
| Iowa | $253 | $794 |
| Kansas | $419 | $1,048 |
| Kentucky | $486 | $1,009 |
| Louisiana | $588 | $1,477 |
| Maine | $354 | $723 |
| Maryland | $674 | $1,159 |
| Massachusetts | $456 | $1,049 |
| Michigan | $919 | $1,786 |
| Minnesota | $486 | $1,059 |
| Mississippi | $410 | $939 |
| Missouri | $594 | $1,334 |
| Montana | $318 | $961 |
| Nebraska | $377 | $980 |
| Nevada | $838 | $1,557 |
| New Hampshire | $459 | $942 |
| New Jersey | $828 | $1,491 |
| New Mexico | $411 | $974 |
| New York | $1,170 | $2,078 |
| North Carolina | $428 | $871 |
| North Dakota | $328 | $785 |
| Ohio | $360 | $737 |
| Oklahoma | $379 | $944 |
| Oregon | $642 | $1,121 |
| Pennsylvania | $385 | $1,023 |
| Rhode Island | $609 | $1,128 |
| South Carolina | $664 | $1,286 |
| South Dakota | $294 | $957 |
| Tennessee | $345 | $852 |
| Texas | $562 | $1,198 |
| Utah | $530 | $965 |
| Vermont | $277 | $677 |
| Virginia | $455 | $955 |
| Washington | $584 | $1,070 |
| West Virginia | $474 | $1,051 |
| Wisconsin | $378 | $906 |
| Wyoming | $264 | $876 |
Below, we've broken down our recommended steps to getting the best and cheapest low-income car insurance possible.
Before going into the buying process, you should assess your finances and determine how much monthly you can afford. From there, you should find out if you can only afford minimum coverage for your state or higher-level plans. We offer an auto insurance coverage calculator to help you get started.
In addition to traditional car insurance providers, you should also look into programs through your state government, your automaker and usage-based plans.
Many low-income earners can get car insurance discounts such as for paying in full, related to occupation, good grades, bundling and safe driving. You can also take a safe or defensive driving course in your state for a low cost to save up to 20% on premiums.
To understand what coverage options and discounts are available to you along with customer reputations, you need to look into companies in your area individually. This will allow you to make a decision not just based on cost, but also along the lines of coverage and overall customer experience.
Comparing multiple company quotes apples to apples is the best way to understqand who is the cheapest option for you. Also, using multiple means for getting quotes like online comparison sites, calling agents, using brokers, and going on company websites will narrow down the best price even further.
We found the best and cheapest low income car insurance is offered by USAA, State Farm and Geico. While this is the case, we recommend that you do your own research, decide on your coverage needs, and compare plenty of quotes to get the best deal possible. If you are unable to find affordable coverage through traditional means, government programs are also there to assist you.
MoneyGeek answers frequently asked questions to help low-income drivers find the most affordable car insurance provider and the best deal.
State Farm offers the most affordable auto insurance for most drivers, but this can change based on your needs, such as if you're a young driver, a military member or a driver with an at-fault accident.
According to MoneyGeek's analysis, the Subaru Forester is the most affordable car to insure, whether used or new. It's also the cheapest SUV.
Finding the cheapest car insurance quotes requires comparing different providers. Since this can take time, MoneyGeek created a car insurance calculator. Enter your details to get quick estimates that can guide your research.
Getting cheap auto insurance has risks. While it costs less, it may not provide enough financial protection in an at-fault accident. With only minimum liability limits, you could pay thousands of dollars for your medical bills and repairs. You might also have to cover the other party's expenses out of pocket if your coverage isn't adequate (except in no-fault states).
Why Trust MoneyGeek?
MoneyGeek collected quote data from state insurance departments and Quadrant Information Services to find the most affordable car insurance companies for low-income drivers nationwide and by state. We also researched low-income car insurance assistance programs and financial aid options to help readers find solutions that fit their budgets.
Study Overview
We analyzed auto insurance rates for low-income drivers at the state and national levels. We used various insurance companies and coverage types with our sample driver profile to calculate average premiums for low-income drivers in each state.
Data Sources and Depth
We gathered auto insurance information from state insurance departments and Quadrant Information Services. MoneyGeek reviewed about 83,056 quotes from 46 insurance providers across 473 ZIP codes.
Driver Profile
To establish a baseline for auto insurance premiums, MoneyGeek used an average driver profile with these traits:
We adjusted this profile based on premium-influencing factors like age, driving history, state, ZIP code and average mileage.
Coverage Levels and Deductibles Explained
Your chosen coverage level affects your insurance rates. Full coverage, which includes comprehensive and collision coverage, costs more but provides the most financial protection. Minimum coverage is the cheapest option but offers the least protection.
MoneyGeek used state minimum requirements and 100/300/100 liability limits when collecting data for minimum and full coverage policies. The full coverage policy has a $1,000 deductible for comprehensive and collision coverage. After an at-fault accident or non-collision incident, you pay this deductible before your insurance covers vehicle damage.
100/300/100 means:
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
Passionate about economics and insurance, he aims to promote transparency in financial topics and empower others to make confident money decisions.
