Cheap Iowa Low-Income Car Insurance for Families and Individuals

Car insurance companies consider a list of factors when calculating car insurance rates. Income is not one of them. In Iowa, the coverage levels you select and adding a teen driver to your policy significantly impact how much you’ll pay for car insurance.

MoneyGeek calculated the cheapest car insurance options for low-income individuals and families in Iowa, based on whether you have a poor or good credit score.

There are no government car insurance programs in Iowa to assist low-income families and individuals with car insurance costs. State law requires Iowa drivers to carry insurance coverage, and yet some 11.3% of drivers in Iowa are uninsured. For the majority, this is likely because they can’t afford car insurance costs.

If you’re a low-income driver in Iowa, the cheapest car insurance is a policy with minimum coverage. Pay-per-mile insurance is another option for those who drive infrequently.

There are no government car insurance programs for low-income drivers in Iowa. One way to save on insurance costs is to compare quotes across multiple car insurance companies. MoneyGeek broke down the cheapest car insurance companies in Iowa for low-income drivers looking for savings.

Car insurance companies do not consider income when calculating car insurance costs. However, they do look at other factors seemingly related to income, like your age and claims history. Your credit score is another important consideration.

The cheapest option for low-income drivers is state minimum insurance, although it provides the lowest protection. MoneyGeek found that, on the whole, GEICO has the cheapest car insurance in Iowa.

Car insurance rates are not affected by your income level, but low-income families should know that their credit score can greatly impact their premiums. Single parents with a teen driver and poor credit score pay around $775 more per year compared to those with good credit. Couples with a teen driver and poor credit pay $1,044 more per year than those with a good credit score.

The two cheapest car insurance companies in Iowa for couples with a teen driver and poor credit score are:

• GEICO: $1,811 per year
• Progressive: $1,875 per year

USAA has the cheapest car insurance in Iowa at $1,664 per year on average. However, USAA was excluded from our list as the insurer is exclusive to military members and their families.

The two cheapest companies for single parents with a teen driver and poor credit scores are:

• State Farm: $1,437 per year
• GEICO: $1,484 per year

At $1,224 per year on average, USAA offers the most affordable car insurance in Iowa. Again, however, these policies are only available to active and former military members and their families.

Remember that just because you have a low income doesn’t mean you have a poor credit score. Use the table below to find the cheapest options available to you.

Our sample 40-year old driver in Iowa pays $242 per year more for car insurance with poor credit scores than good ones. The cheapest car insurance for low-income individuals in Iowa are from the following companies:

• GEICO: $397 per year
• State Farm: $468 per year

Individuals with poor credit but who are former or current members of the military can buy the cheapest auto insurance in Iowa from USAA at an average of $386 per year.

Just because you have a low income doesn't mean you have a poor credit score. Individuals with good credit scores definitely see cheaper car insurance rates than those with poor credit. Drivers with good credit scores can buy car insurance at $239 per year on average from GEICO and $281 per year from State Farm.

Young student drivers tend to be charged more for car insurance due to having little experience behind the wheel. Despite not being charged higher premiums for having a low income, car insurance costs can eat up a chunk of a student’s income.

The cheapest car insurance for low-income students with poor credit scores in Iowa are:

• GEICO: $867 per year
• State Farm: $1,021 per year

Although USAA car insurance is the cheapest for student drivers with poor credit scores at $843 per year, only military members and their families can buy from this provider.

Having a low income doesn’t automatically mean you have poor credit. Students with good credit scores may be able to find cheaper car insurance rates. GEICO, for example, costs approximately $522 per year, and State Farm costs $614.

Senior drivers are considered slightly riskier to insure than middle-aged drivers and therefore pay more in car insurance. Rates increase even more if you’re a senior with poor credit. Our sample 70-year-old driver with a poor credit score in Iowa pays $268 per year more than their counterpart with good credit.

The two cheapest car insurance companies for low-income seniors with poor credit scores in Iowa are:

• GEICO: $452 per year
• State Farm: $468 per year

At an average of $435 per year, USAA has the cheapest car insurance in Iowa for this driver profile. However, USAA is exclusive to retired and current members of the military and their families.

You can have a good credit score even if you have a low income, which makes a big difference in terms of how much your car insurance will cost you. Seniors with good credit can buy policies from GEICO at an average of $272 per year and from State Farm at $281 per year.

Insurance companies can’t take income as a factor when calculating rates. However, they may look at other factors that seemingly relate to income, such as your age.

Let’s say you’re a recent graduate just starting your career, so you’re low income. The reason your car insurance rates are higher than middle-aged drivers isn’t your income. It’s that you’re a young driver who doesn’t have the driving experience of your middle-aged counterpart. If you’re a driver who makes lots of claims, that will increase your premiums. They are not increased because of your low income.

MoneyGeek studied the factors that affect car insurance rates in Iowa the most. The top three are:

• Your age.
• The coverage level you select.
• Adding a teen driver to your policy.

Your credit score and the model of your car are also important factors.

MoneyGeek calculated the cost of car insurance for low-income drivers in Iowa using quotes sourced in partnership with Quadrant Information Services. The sample driver is either a 40-year-old male, a single 40-year-old parent with a 16-year-old child, an adult couple each 40 years old or a couple with a 16-year-old child. The individual or family drives a 2010 Toyota Camry LE. The driver buys the minimum car insurance required in Iowa.

Costs for poor and good credit scores were extrapolated based on MoneyGeek’s dataset of credit score rate adjustments by score categorization.