Cheap New Jersey Low-Income Car Insurance for Families and Individuals

New Jersey assists low-income drivers in obtaining car insurance through the Special Automobile Insurance Policy (SAIP). Meanwhile, MoneyGeek’s research shows GEICO is the state’s cheapest car insurance provider for low-income individuals and families.

REVIEW AUTO INSURANCE RATES

Insurance Rates

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

widget-location-pin
Advertising & Editorial Disclosure
Last Updated: 11/25/2022
Written By     |  

Insurers don’t use income when calculating car insurance rates. In New Jersey, the most significant factors that affect the price of insurance premiums are your credit score and adding a teen driver to your car insurance policy. MoneyGeek found the most affordable car insurance for low-income individuals and families in New Jersey, comparing rates for drivers with poor and good credit scores.

Is There Car Insurance for Low-Income Families and Individuals in New Jersey?

The state of New Jersey provides car insurance assistance for low-income individuals through the Special Automobile Insurance Policy (SAIP). You need to be enrolled in the Federal Medicaid with hospitalization program to qualify, although not all Medicaid programs are eligible. When applying for SAIP, you’ll have to present your driver’s license and vehicle registration.

If you don’t qualify for SAIP, you can consider state minimum insurance policies, which are usually the most affordable traditional car insurance on the market. Pay-per-mile insurance is also a cheap car insurance option for low-income people in New Jersey who drive very little.

tip icon

New Jersey’s Government Assistance Program for Low-Income Drivers

SAIP, also called dollar-a-day insurance, is the New Jersey government car insurance program for low-income individuals. As its name suggests, the policy costs $365 per year. It’s available for people enrolled in the Federal Medicaid with Hospitalization program.

SAIP covers expenses following a car accident, including:

  • Emergency medical treatment
  • Treatment of serious brain and spinal cord injuries resulting from the car accident for up to $250,000
  • Death benefit of $10,000

Although SAIP pays for medical costs, it doesn’t cover liability costs and damages to the driver’s vehicle.

tip icon
ELIGIBILITY REQUIREMENTS FOR NEW JERSEY GOVERNMENT CAR INSURANCE

Low-income individuals in New Jersey need to meet the following requirements to qualify for the SAIP:

  • Current enrollment in an eligible Federal Medicaid with Hospitalization program.
  • A valid driver’s license and vehicle registration.
  • No existing car insurance policy

SAIP follows a one car per policy rule. However, if the household only has one car and multiple people are enrolled in an eligible Medicaid program, qualified household members can all be covered under the same insurance policy.

The Cheapest New Jersey Car Insurance Companies for Low-Income Drivers

Car insurance companies in New Jersey can’t use income to determine car insurance rates. However, they do look at related factors, such as age and credit score, which affect the price of car insurance premiums.

The cheapest car insurance for most low-income drivers in New Jersey is minimum coverage. MoneyGeek’s research found that GEICO is the state’s most affordable car insurance provider for low-income families, adults, students and seniors.

In the following sections, we broke down the cheapest minimum car insurance for low-income families and individuals of various ages.

Insurance Rates

Compare Auto Insurance Rates

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

widget-location-pin

The Cheapest New Jersey Car Insurance Companies for Low-Income Families

Although income doesn’t affect car insurance rates in New Jersey, low-income families should know that credit scores affect premium prices.

An average single parent in New Jersey with a poor credit score pays around $3,507 more per year for car insurance compared to their counterpart with a good credit score. Similarly, car insurance in New Jersey costs approximately $4,825 more per year if a couple with a child has a poor rather than good credit score.

MoneyGeek’s research shows that the most affordable car insurance providers for a single parent with a poor credit score in New Jersey are:

  • GEICO: $3,318 per year
  • New Jersey Manufacturers: $4,837 per year

Meanwhile, couples with a child and a poor credit rating can look to the following companies for the cheapest car insurance:

  • GEICO: $4,157 per year
  • New Jersey Manufacturers: $7,095 per year

Of course, not all low-income individuals have poor credit scores. You can use the table below to find the cheapest options for your profile.

Sort by family type:

Single parent w/ a kid

Switch by Credit Score:

Good Credit Score

Scroll for more

swipe icon
  • Company
    Annual Rates
  • GEICO
    $1,614
  • New Jersey Manufacturers
    $2,353
  • Amica Mutual
    $2,529
  • Allstate
    $2,545
  • Progressive
    $3,130
Insurance Rates

Compare Auto Insurance Rates

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

widget-location-pin

The Cheapest New Jersey Car Insurance Companies for Low-Income Individuals

On average, car insurance rates for our sample 40-year-old driver in New Jersey differ by $1,108 per year based on whether their credit score is poor or good.

MoneyGeek’s analysis found that the cheapest car insurance providers for low-income individuals in New Jersey with poor credit scores are:

  • GEICO: $1,057 per year
  • New Jersey Manufacturers: $1,629 per year

Having a low income doesn’t necessarily mean having a poor credit score. For a person with a good credit score, a GEICO policy costs roughly $514 per year, while the average price of car insurance from New Jersey Manufacturers is $792 per year.

Switch by Credit Score:

Good Credit Score

Scroll for more

swipe icon
  • Company
    Annual Rates
  • GEICO
    $514
  • New Jersey Manufacturers
    $792
  • Allstate
    $853
  • Amica Mutual
    $903
  • Progressive
    $905

The Cheapest New Jersey Car Insurance Companies for Low-Income Students

Young drivers tend to have less driving experience, so insurers charge them more for car insurance. Although college students in New Jersey aren’t paying more for car insurance due to their low incomes, they don’t usually make much, and their premiums can consume a large share of the money they do make.

MoneyGeek’s study shows that the two cheapest car insurance companies for low-income students in New Jersey are:

  • GEICO: $2,366 per year
  • New Jersey Manufacturers: $3,647 per year

A low income doesn’t necessarily translate to a poor credit score. Young drivers in New Jersey with good credit scores pay approximately $1,151 per year for GEICO policies and roughly $1,774 per year for car insurance through New Jersey Manufacturers.

Switch by Credit Score:

Good Credit Score

Scroll for more

swipe icon
  • Company
    Annual Rates
  • GEICO
    $1,151
  • New Jersey Manufacturers
    $1,774
  • Allstate
    $1,910
  • Amica Mutual
    $2,022
  • Progressive
    $2,027

The Cheapest New Jersey Car Insurance Companies for Low-Income Seniors

On average, car insurance is slightly higher for seniors compared to middle-aged drivers. Beyond their age, a senior’s credit score also greatly affects their car insurance rates. A sample 70-year-old driver in New Jersey pays $978 more per year if they have a poor credit score instead of a good credit score.

MoneyGeek found that the cheapest car insurance companies for low-income seniors in New Jersey are:

  • GEICO: $1,010 per year
  • New Jersey Manufacturers: $1,342 per year

Having a low income doesn’t necessarily result in a poor credit score. For a senior in New Jersey with a good credit score, a GEICO policy on average costs $492 per year, while a New Jersey Manufacturers’ policy costs around $653 per year.

Switch by Credit Score:

Good Credit Score

Scroll for more

swipe icon
  • Company
    Annual Rates
  • GEICO
    $492
  • New Jersey Manufacturers
    $653
  • Allstate
    $718
  • Amica Mutual
    $779
  • Progressive
    $886

Does Income Affect Car Insurance Rates in New Jersey?

When determining car insurance rates, companies in New Jersey can’t use income as a factor. However, income-related factors can affect the price of insurance premiums.

For example, insurance providers consider younger drivers riskier to insure due to their driving inexperience, so they are charged more. Coincidentally, younger drivers tend to have lower incomes since they’re still studying or just starting their careers. However, they aren’t paying higher insurance rates due to their low income.

MoneyGeek studied income-related factors and their effect on car insurance rates in New Jersey. Based on our research, the following have the most impact:

  • Adding a teen driver to their car insurance policy.
  • Credit score.
  • Age of driver.

Other factors, such as driving record and car model, also influence how car insurance companies price their policies.

  • Factor
    How it Affects Your Rates
  • Adding a Teen Driver

    In New Jersey, adding a teen driver is the biggest factor, increasing rates by 3x.

  • Age of Driver

    A driver’s age is an important factor in New Jersey, and can make car insurance 2.6x more expensive.

  • Coverage Levels

    The amount of coverage you select can increase the price of premiums in New Jersey by 1.7x.

  • Car Model

    A driver’s car model can make their insurance twice as expensive in New Jersey.

  • Credit Score

    In New Jersey, people with poor credit scores may pay 2.6x more compared to folks with excellent scores.

Methodology

MoneyGeek calculated the cost of car insurance for low-income drivers in New Jersey 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 New Jersey.

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

About the Author


expert-profile

Mark Fitzpatrick is a senior content manager with MoneyGeek specializing in insurance. Mark has years of experience analyzing the insurance market and creating original research and content. He graduated from Boston College with a Bachelor of Arts and Johns Hopkins University with a Master of Arts.