Cheap Texas Low-Income Car Insurance for Families and Individuals

Texas does not have a program for low-income drivers. MoneyGeek ranked the most affordable car insurance companies in the state to help low-income drivers save money on car insurance. We found that Farmers offers the cheapest car insurance for low-income families and individuals in Texas.

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Last Updated: 8/15/2022
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Your income level is not used to price car insurance in Texas or any other state. What affects Texas car insurance rates the most is the level of coverage you select and if you add a teen driver to your policy. MoneyGeek calculated how much low-income individuals and families would have to spend on car insurance based on their credit scores.

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

There are no government car insurance programs in Texas to assist low-income families and individuals with car insurance costs. Though required in all states, uninsured drivers may be avoiding car insurance because it is expensive. About 8.3% of drivers in Texas are uninsured.

If you’re looking for low-income car insurance in Texas, your best option will usually be a traditional minimum coverage policy. If you drive infrequently, you may wish to consider pay-per-mile insurance coverage, an affordable option in Texas for low-income drivers.

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Does Texas Have a Government Program to Support Low-Income Drivers with Insurance?

In Texas, there is no government assistance program for low-income drivers. If you need cheap car insurance, the best solution is to compare quotes across several car insurance companies. MoneyGeek broke down the cheapest car insurance companies for low-income families in Texas looking to save money on car insurance.

The Cheapest Texas Car Insurance Companies for Low-Income Drivers

Car insurance companies in Texas don’t consider income when calculating your car insurance rates, but other factors, including your age and credit score, are considered important.

A minimum coverage policy is the cheapest type of car insurance you can buy, although it provides the least protection. MoneyGeek found that Farmers, State Farm and GEICO are the cheapest Texas car insurance companies for low-income drivers.

In addition to comparing rates based on credit scores, MoneyGeek analyzed the cheapest minimum car insurance for low-income families and individuals in Texas based on the driver’s age.

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The Cheapest Texas Car Insurance Companies for Low-Income Families

While car insurance rates aren’t affected by income, your credit score can greatly affect your premiums. For our sample single parent, rates in Texas differed by $1,840 per year if you had a poor credit score versus a good credit score. For couples with one teen, rates in Texas differed by $2,605 per year if you had a poor credit score versus if you had a good credit score.

The two cheapest companies for a couple with a teenage child if they had poor credit scores are:

  • Farmers: $3,765 per year
  • State Farm: $4,253 per year

Drivers who are current or retired members of the military may also consider USAA. The insurer offers the second cheapest car insurance rates in Texas at $3,801 per year on average for a couple with a teenage child and a poor credit score.

The two cheapest car insurance companies in Texas for single parents with poor credit scores are:

  • Farmers: $2,832 per year
  • State Farm: $3,113 per year

Although USAA is the cheapest option in Texas for single parents with poor credit, only military members are eligible for insurance from this provider. If you qualify, you should note these policies cost on average $2,703 per year.

It’s important to remember that just because you may be low-income doesn’t necessarily mean you have a poor credit score. The table below can help you find the cheapest options for your profile.

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Single parent w/ a kid

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  • Company
    Annual Rates
  • USAA
    $1,482
  • Farmers
    $1,553
  • State Farm
    $1,707
  • AAA
    $1,941
  • GEICO
    $1,971
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The Cheapest Texas Car Insurance Companies for Low-Income Individuals

For our sample 40-year-old driver, rates in Texas differed by $546 per year if you had a poor credit score versus a good credit score. The two cheapest companies for drivers with poor credit scores are the following:

  • Farmers: $789 per year
  • State Farm: $930 per year

USAA is the second cheapest company in Texas. Policies for 40-year-old drivers with poor credit cost an average of $796 per year. However, USAA was excluded from our ranking as their car insurance policies are exclusively available to former and current military members and their families.

While you may have a low income, it doesn’t necessarily mean you have a poor credit score. A good credit score will definitely be reflected in the cost of your insurance. Policies from Farmers for drivers with good credit scores cost $433 per year on average, and those from State Farm cost $510 per year on average.

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  • Company
    Annual Rates
  • Farmers
    $433
  • USAA
    $437
  • State Farm
    $510
  • GEICO
    $544
  • AAA
    $580

The Cheapest Texas Car Insurance Companies for Low-Income Students

Because of their lack of driving experience, young student drivers in Texas face higher car insurance rates. Most students are, by default, low-income individuals. Despite not being charged higher premiums because of their low incomes, car insurance rates can consume a large portion of a student’s income.

The two cheapest companies available to young drivers with a poor credit score are:

  • Farmers: $1,902 per year
  • State Farm: $2,241 per year

Although USAA car insurance premiums are the second cheapest in the state at $1,919 per year on average, they were excluded in our rankings because only military members are eligible to buy policies from this provider.

You can have a good credit score, even if you have a low income. Farmers offer car insurance at $1,043 per year on average for young drivers with good credit, while State Farm offers their policies at $1,229 per year on average.

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Good Credit Score

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  • Company
    Annual Rates
  • Farmers
    $1,043
  • USAA
    $1,053
  • State Farm
    $1,229
  • GEICO
    $1,312
  • AAA
    $1,397

The Cheapest Texas Car Insurance Companies for Low-Income Seniors

Senior drivers tend to pay slightly higher car insurance premiums than their middle-aged counterparts. Car insurance for low-income seniors in Texas is also higher if they have poor credit scores. For our sample 70-year-old driver, rates in Texas differed by $638 per year if you had a poor credit score versus if you have a good credit score.

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

  • Farmers: $871 per year
  • State Farm: $916 per year

USAA offers car insurance at $959 per year on average, which is the third cheapest in the state for senior drivers with poor credit. However, USAA was not included in our rankings as the car insurance they offer is limited to military members.

Just because you have a low income doesn’t mean you have a poor credit score. And a good credit score makes a big difference in the price of insurance. Farmers offers car insurance to low-income seniors with good credit at an average of $478 per year, while at State Farm, the annual premium is an average of $502 per year.

Switch by Credit Score:

Good Credit Score

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  • Company
    Annual Rates
  • Farmers
    $478
  • State Farm
    $502
  • USAA
    $526
  • GEICO
    $634
  • Allstate
    $648

Does Income Affect Car Insurance Rates in Texas?

Insurance companies can’t use income as a factor in calculating your car insurance rates. However, other factors seemingly related to income may affect your rates.

For example, younger people are charged higher rates because they are considered more likely to get into an accident. They may also have lower incomes because they’re just starting their careers. People with lower incomes may not be able to afford to pay for repairs out-of-pocket, so make more claims. Insurers charge more for drivers with a history of claims.

MoneyGeek analyzed factors that might be related to low income and how they affect rates in Texas. The top three important factors are:

  • Adding a teen driver.
  • Coverage levels.
  • Driver’s age.

Other factors like your credit score and car’s model are also important.

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

    When buying car insurance in Texas, adding a teen driver is 3.6x more expensive.

  • Coverage Levels

    Your choice of coverage level, such as opting for a full coverage policy, costs more by 2.5x than state minimum.

  • Age of Driver

    In Texas, rates can vary by 2.4x for young drivers compared to middle-aged drivers.

  • Credit Score

    Having a poor credit score costs 2.3x more than with an excellent score.

  • Car Model

    Having the latest car model could make your car insurance rate twice as expensive.

Frequently Asked Questions About Low-Income Car Insurance in Texas

MoneyGeek answers the most frequently asked questions about low income car insurance in Texas:

Methodology

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

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


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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.