Cheapest Car Insurance for Low-Income Drivers in Michigan (October 2024)


Travelers is the cheapest car insurance for individual drivers with low income and poor credit in Michigan, with a monthly rate of $67. It is also the most affordable option for families with low income, with a monthly rate of $36. Michigan doesn't provide state-backed car insurance programs for families and individuals with low income. Seeking out providers with the most affordable rates and exploring discount options can help manage the cost of car insurance.

Although minimum coverage allows you to drive legally, it has drawbacks. For instance, it may not cover all expenses in an at-fault accident, leaving you financially vulnerable.

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Cheapest for Individuals With Low Income

Travelers is the cheapest car insurance provider in Michigan for individual drivers with low income and poor credit history. Its average minimum coverage premium is $67 per month or $810 per year.

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Cheapest for Families With Low Income

Travelers is the cheapest car insurance provider for families with low income in Michigan. Its average minimum coverage premium is $36 per month or $426 per year.

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Cheapest for Senior Drivers With Low Income

Encompass is the cheapest car insurance provider in Michigan for seniors with low income and poor credit scores. Its average minimum coverage premium is $60 per month or $726 per year.

Why Trust MoneyGeek? We analyzed thousands of data points and quotes from Quadrant Information Services and the Michigan Department of Insurance and Financial Services to get the cheapest average costs for drivers with low income in Michigan.

50,284Quotes Analyzed
 
14Companies Compared
 
74ZIP Codes

Does Michigan Offer Low-Income Insurance?

Car insurance companies in Michigan do not consider your income when calculating rates. Instead, they look at factors like age, driving record, credit history and the type of car you drive. At-fault accidents and moving violations will increase your rates. To find the cheapest rates, it's best to compare quotes from several insurance companies.

If your budget is tight, a basic minimum coverage policy is often the cheapest way to stay legal on the road. If you rarely drive, pay-per-mile insurance can be the best option to save. MoneyGeek rounded up the cheapest insurers for drivers in Michigan with low income to help you save.

Minimum Car Insurance Requirements in Michigan

To legally operate a vehicle in Michigan, you're required to carry car insurance that meets the state minimum car insurance requirements. Your policy should include at least the following coverages:

  • $50,000 for bodily injury liability per person
  • $100,000 for bodily injury liability per accident
  • $10,000 for property damage liability per accident
  • Unlimited personal injury protection (PIP) per person

Michigan residents have two main policy choices. A liability-only car insurance is more affordable and covers damages to other parties if you're at fault in an accident. However, it won't cover your own vehicle. To protect your car, you'll need full coverage car insurance, which includes collision and comprehensive coverages. These cover various incidents, including theft and natural disasters.

Understanding the risks and benefits of each option is crucial to choosing the right coverage for your situation.

Cheapest Car Insurance for Individuals With Low Income in Michigan

Credit history is crucial for drivers with low income in Michigan as it can significantly affect car insurance premiums. A poor credit record may signal a higher risk to insurers, leading to higher premiums. Maintaining a good credit-based insurance score is essential to secure affordable car insurance rates.

The cheapest car insurance companies for drivers with low income and poor credit record in Michigan are:

  • Travelers: $810 per year; $67 per month
  • Encompass: $826 per year; $69 per month

Drivers with good credit can get the cheapest car insurance in Michigan from:

  • Westfield: $409 per year; $34 per month
  • Travelers: $421 per year; $35 per month

Driving without insurance in Michigan is considered a misdemeanor and can lead to suspension of your driver’s license and vehicle registration, fines ranging from $175 to $1,000 and other penalties.

Data filtered by:Results filtered by:
Credit Score:
Credit Score:Poor
Travelers$810$67
Encompass$826$69
GEICO$1,005$84
Progressive$1,167$97
Westfield$1,178$98
Auto-Owners Insurance Co$1,253$104
Pioneer State Mutual Ins Co$1,559$130
Grange Insurance$2,000$167
Farm Bureau Ins of MI$2,540$212
Farmers$3,921$327
State Farm$5,082$423
Hanover$10,370$864
Chubb$10,625$885
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Cheapest Car Insurance for Families With Low Income in Michigan

Although your income doesn't impact your car insurance rates, your family situation does. For instance, in Michigan, a single parent's premium with Travelers is higher by $129 annually than that of a married couple with a teen. The difference is even starker monthly, with single parents paying an extra $10 with Travelers and $58 with GEICO compared to married couples without a teen.

The most affordable car insurance companies for a married couple with a teen in Michigan are:

  • Travelers: $426 per year; $36 per month
  • GEICO: $1,167 per year; $97 per month

For a single parent with a teen, the cheapest options are:

  • Travelers: $555 per year; $46 per month
  • GEICO: $1,854 per year; $155 per month

Single parents generally face higher premiums than married couples with a teen. This is due to insurers viewing single parents as having a higher risk profile. Maintaining a good credit score is essential, as it can significantly influence your eligibility for more affordable car insurance rates.

Data filtered by:Results filtered by:
Family Type:
Family Type:Married Couple with Teen
Travelers$426$36
Encompass$1,167$97
GEICO$1,167$97
Progressive$1,303$109
Auto-Owners Insurance Co$1,314$110
Farmers$3,627$302
State Farm$5,233$436

Cheapest Car Insurance for Seniors With Low Income in Michigan

Car insurance premiums generally decrease as individuals reach their early senior years, typically around ages 55 to 65, especially if they maintain a clean driving record. The two cheapest car insurance for senior drivers with low income and poor credit history are:

  • Encompass: $726 per year; $60 per month
  • Travelers: $852 per year; $71 per month

After age 70, car insurance rates typically increase as older drivers are statistically considered higher risk. This trend continues each year, meaning premiums generally rise as seniors age. In Michigan, there may be specific laws or guidelines for seniors obtaining car insurance.

Data filtered by:Results filtered by:
Credit Score:
Credit Score:Poor
Encompass$726$60
Travelers$852$71
GEICO$1,023$85
Progressive$1,186$99
Westfield$1,280$107
Auto-Owners Insurance Co$1,623$135
Pioneer State Mutual Ins Co$1,630$136
Grange Insurance$2,439$203
Farm Bureau Ins of MI$2,609$217
Farmers$3,652$304
State Farm$4,646$387
Chubb$8,403$700
Hanover$9,797$816
Compare Auto Insurance Rates

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

What Factors Affect Car Insurance Rates in Michigan?

Income doesn't directly affect car insurance rates in Michigan. However, low income can lead to a poor credit record, which can make your rates higher. On the other hand, good credit can help you get lower rates. Understanding the factors contributing to car insurance rates can help you make informed decisions when choosing the best car insurance for you.

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    Driving record

    At-fault accidents and moving violations increase rates. Insurers see drivers with these offenses as higher risk, leading to higher premiums.

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    Age and gender

    Younger drivers and males often pay higher rates. Statistics show they are more likely to be involved in accidents.

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    Credit history

    Poor credit history can lead to higher premiums. Insurers use credit-based insurance scores to assess risk.

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    Location

    Urban areas generally have higher rates due to increased risk of accidents and theft.

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    Vehicle type

    High-performance and luxury cars cost more to insure. They are more expensive to repair or replace.

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    Coverage levels

    Higher coverage levels result in higher costs. Minimum coverage is cheaper but offers less protection.

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    Insurance company

    Different companies offer varied rates and discounts. It's important to compare quotes.

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    Claims history

    A history of filing claims can lead to higher rates as it indicates a higher risk to insurers. If you can afford to pay for your own repairs, it might pay not to file a claim.

How to Save on Car Insurance in Michigan

Residents of the Great Lakes State have several strategies to find affordable car insurance, whether or not they qualify for state-sponsored programs for drivers with low income. Here are some tips to lower your car insurance premiums:

  1. 1
    Choose minimum coverage

    Opting for a state-mandated minimum coverage can help you save while meeting legal requirements to drive.

  2. 2
    Comparison shop

    Getting quotes from multiple insurers to compare rates and discounts and shopping locally might lead to the lowest car insurance rates.

  3. 3
    Look for discounts

    Many insurance companies offer discounts for factors such as being a good student, having a safe driving record, being a military member or bundling your auto insurance with other policies.

  4. 4
    Increase your deductible

    If you opt for collision or comprehensive coverage, choosing a higher car insurance deductible can significantly reduce your monthly premium. But be sure you can afford the deductible in case of an accident.

  5. 5
    Consider pay-per-mile insurance

    Pay-per-mile is a great option if you're a low-mileage driver. You pay a base rate plus a per-mile fee, so you only pay for the miles you drive.

  6. 6
    Bundle your policies

    If you have other insurance needs, like homeowners or renters insurance, bundling them with your auto policy can often lead to discounts. The best home and auto bundles can save you around $496 each year.

  7. 7
    Drive a cheaper car

    Your car's make, model and year significantly impact your insurance costs. Driving the cheapest cars to insure can save you hundreds of dollars in insurance costs each year.

FAQ: Low-Income Car Insurance in Michigan

Finding affordable car insurance in Michigan can be challenging for drivers with low income. Here are answers to some of your most common questions on low-income car insurance.

Does Michigan have a state-backed low-income car insurance program?

How can low-income families get affordable car insurance in Michigan?

Does your income affect the cost of car insurance in Michigan?

What are the benefits of usage-based telematics programs for drivers with low income in Michigan?

About Mark Fitzpatrick


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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.