The best affordable car insurance companies for 2020

Liz Knueven

Nov 30, 2019, 03:20 IST

The best affordable car insurance companies for 2020

Jeppe Wikstrom/ Getty Images

Here are the best cheap car insurance companies for 2020:

Best overall car insurance: GEICO
Runner-up: Erie Insurance
Best car insurance for military families: USAA
Best car insurance for drivers with bad credit: GEICO
Best car insurance for a driver with a DUI on their record: State Farm
Best car insurance for teens and young drivers: Erie
Best car insurance for seniors: Nationwide
Best car insurance for a driver with one accident on their record: Erie
Best car insurance for full coverage: Erie

Choosing the best car insurance can be overwhelming: There are so many options, and there are a lot of different average prices out there. So, what's the best car insurance for everyone?

There's no short answer, because everyone's costs for coverage with every company is different. Insurance costs can be influenced by your age, gender, credit score, driving history, and much more. And there are hundreds of insurance companies out there - in some states, there are as many as 250 companies offering insurance, according to NAIC data. Because there are so many companies and so many variables, know that without getting a direct quote, a pick on this list might not necessarily give you the best price.

This list should be used as a starting point to explore a wide variety of your options. To get the best price on car insurance coverage, you'll need to shop around. Get quotes and compare them, and then you'll be able to find the insurance company that's the best price for you. That said, here are our top picks for cheap car insurance in 2019.

Best car insurance for affordable coverage overall: GEICO

Based on the average pricing data from ValuePenguin and Insurance.com, GEICO tends to offer some of the most affordable coverage in the US available nationally.
Offers great service when you need it, ranking highly for customer satisfaction from JD Power and Associates' 2019 Auto Claims Satisfaction survey.
Average cost of coverage for a typical adult driver : $1,009 per year

If you're looking for the lowest price, GEICO might be the company to turn to. This insurance company is relatively friendly to drivers with poor credit scores, and often offers low premiums.

It tends to offer good service as well, earning a 879 out of 1,000 from JD Power and Associates' 2019 Auto Claims Satisfaction survey, earning it a spot in the survey's top three, tying with Erie for consumer satisfaction.

GEICO generally offers great service and great rates, so it's a good place to start when shopping around and comparing quotes.

Runner up: Erie Insurance

Only available in some midwest and northeast states, this insurance company has a reputation for low prices and good service.
Average cost of coverage for a typical adult driver: $894 per year.

While it's not available everywhere in the US, Erie Insurance is a solid choice for a variety of scenarios, and offers fairly affordable rates. Erie Insurance is offered in Washington DC, Illinois, Indiana, Kentucky, Maryland, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and Wisconsin. According to The Zebra, the average adult with a good credit score would pay about $894 per year to maintain coverage with Erie.

This insurance company won three categories on this list: best car insurance for teen drivers, best car insurance for a driver with one accident, and best car insurance for a driver wanting full coverage. It also earned the third spot in customer satisfaction in JD Power and Associates' 2019 Auto Claims Satisfaction survey, tying with GEICO. If you live in one of the states it covers, Erie could offer competitive premiums and great customer service.

Best car insurance for military families: USAA

Only available to military members and their families.
Premiums for typical driver: $910 per year

USAA car insurance is only available to military members and their families, and offers great claims experiences and low premiums. Active and former military members are eligible, as well as many family members, including spouses and children.

USAA offers some of the most competitive premiums in the car insurance space, and is the most affordable option for car insurance in many states. It has a competitive average premium for the typical adult driver with a very good credit score. In fact, USAA beat out other insurers for drivers who have an accident on their driving record and for those wanting to get more coverage, but didn't win spots on our list in these categories due to limited availability, as it's only an option available to military-affiliated families. If you're eligible for coverage through USAA, this company is worth looking into.

Best auto insurance for drivers with bad credit: GEICO

If you have a poor credit score (below 579 according to FICO), you might want to look into GEICO car insurance.
Average premium for the typical driver with bad credit: $2,448

Drivers with bad credit scores (below 579 according to FICO) are likely to pay the most for car insurance coverage. Many car insurance companies factor credit scores into the amount you'll pay for coverage, and it can drive up prices significantly. However, three states - California, Massachusetts, and Hawaii - have banned the use of credit scores in insurance pricing.

In states where it is allowed, however, GEICO comes up frequently in Business Insider's state-by-state car insurance breakdowns. A ValuePenguin study confirms this, coming out at $2,448 per year for a typical driver with poor credit, $924 less than the national average of $3,372 for drivers with poor credit.

Best car insurance rates for drivers with a DUI: State Farm

With a DUI on your record, your car insurance costs could jump as much as 80%, according to Insurance.com data. State Farm's coverage, however, is predicted to increase only 38% after a DUI.
State Farm average cost of coverage with a DUI on your record: $1,633 per year

With a DUI on your driving record, you'll pay more for car insurance coverage. Data from Insurance.com shows that the average premium increases by an average of 80%. State Farm offers the best affordable coverage after a DUI, with the average increase at about 38% after a DUI incident.

Other insurance companies raise their rates for a driver even more after a DUI incident, with Nationwide hiking its rates for a driver with a DUI by 125%. If there's a DUI on your driving record, know that it will raise your car insurance rates significantly. Getting your car insurance from State Farm could help minimize the damage.

Best car insurance company for teen drivers: Erie Insurance

Available in 12 Midwestern and northeastern states, Erie Insurance company offers some of the best average rates for a teen driver.
Average car insurance rate for a teen driver: $2,411 per year

According to data from ValuePenguin, the cost for covering 17-year-old male driver is estimated at $2,411 per year, while other larger companies like State Farm, Nationwide, and GEICO all estimated $4,000 or more for coverage. For drivers in the west and on the west coast, Grange Insurance Association offers coverage under $4,000 per year for a teen driver.

Erie Insurance is offered in Washington DC, Illinois, Indiana, Kentucky, Maryland, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and Wisconsin.

When insuring a teen driver, it might be a good idea to check with smaller insurance companies like Eerie - a study from ValuePenguin shows that none of the top five large insurance companies offered the best rates for teen drivers.

Best car insurance for senior drivers: Nationwide

Average cost of coverage for a single adult over age 60: $1,042 per year

Car insurance coverage for seniors is most affordable through Nationwide, which covers seniors for about $1,042 per year according to data from The Zebra. Eligible seniors could pay even less for their coverage from USAA, though Nationwide took the top spot due to its universal availability.

Best car insurance for a driver with an accident on their record: Erie Insurance

Erie Insurance is offered in 12 US states.
Average price for coverage with one at-fault accident on your record: $1,924

With an accident on your driving history, you'll likely pay more for coverage. In this scenario, ValuePenguin looked at data on auto insurance pricing after one accident was added to a driving record. In the data, Erie Insurance offered the best price for coverage.

Note that Erie Insurance is offered in Washington DC, Illinois, Indiana, Kentucky, Maryland, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and Wisconsin.

Best car insurance company for full coverage: Erie Insurance

For full coverage, expect to pay a bit more. However, you could be covered in more situations, including comprehensive coverage, which could cover your car in an event like a natural disaster.
Erie Insurance is offered in 12 US states.
The best price for full coverage car insurance comes from Erie car insurance, costing $1,521 per year on average.

The more coverage types and higher limits your policy has, the more your policy will cover. And, that could come in handy if you need it - comprehensive coverage could help you fix your vehicle if it's damaged in something other than a car accident, like a disaster or theft. A minimum policy won't cover these things, so you could have to pay for these damages out of pocket if it happens to you.

However, the more coverage you have, the more it will cost. In data from ValuePenguin, Erie offered the lowest prices for a full coverage insurance policy, which includes coverage limits above state minimum requirements, as well as a comprehensive and collision policy and personal injury protection where necessary.

Note that Erie Insurance is offered in Washington DC, Illinois, Indiana, Kentucky, Maryland, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and Wisconsin.

Frequently asked questions

How did we come up with the best car insurance companies for 2019?

There are a lot of auto insurance companies out there, but we narrowed our focus to the largest insurers, or those who wrote the most direct premiums in 2017 according to the National Association of Insurance Commissioners. Business Insider compiled data on these large insurance companies - including State Farm, GEICO, Progressive, Allstate, USAA, Farmers, Nationwide, American Family, and Erie - and compiled data on rates as reported by ValuePenguin, NerdWallet, The Zebra, and Insurance.com. The data was then organized to fit five common coverage scenarios, including coverage for a young driver, a driver with poor credit, a driver with an accident on their driving record, a driver with a DUI, and someone seeking out extra coverage. This data was then compared to find the best insurer for each situation.

To choose the best overall coverage, Business Insider collected overall average premium data, and compared the companies to find which was available nationwide, and which was the best priced. Data was also collected on customer satisfaction from JD Power and Associates.

How can I find the best car insurance rates for me?

Everyone's car insurance rates will vary, as there are many factors that can go into pricing a premium. Every car insurance company will evaluate you on different factors and weigh those factors differently. The best way to find which car insurance company will help you save is to get quotes from several different insurance companies and compare them.

To find the best one for you out of the quotes you've obtained, compare the coverage types, limits, and deductible, or the amount you'll pay out of pocket if you're involved in an accident. The policy with the lowest price for coverage, the most coverage types and limits, and the lowest deductible is the best one for you.

Who offers the cheapest auto insurance?

According to Business Insider's research, GEICO is offering the best cheap car insurance in 2019, with Erie Insurance as a close second in places where it's available (see above for details). However, the car insurance company that's cheapest for one person may not be for another. Before deciding on insurance policies, you'll want to get four or five quotes from different insurance companies, just to make sure that you're getting the best price for you.

What is the best-rated car insurance company?

Let's face it: Car insurance isn't cheap. You want a car insurance company that gives both great coverage and good service. According to JD Power and Associates data on customer satisfaction, USAA and NJM Insurance Company take the top spots, though their coverage isn't available to everyone. Amica Mutual ranked first for service, Country Financial ranked second, and GEICO and Erie tied for third place. This ranking was based on responses from about 11,000 auto insurance customers who settled a claim between early 2018 and mid 2019.

Is Progressive or GEICO better?

There's a lot of buzz around these two options, but in Business Insider's calculations, GEICO comes out on top. Ranked highly for both value and customer service, GEICO tends to stand out. It won out in several of the scenarios above. While you're shopping, it might be worth getting quotes from both and seeing which one stands out.

What's the best car insurance option for students?

According to Business Insider's research, Erie Insurance generally looked to be the best insurance for young adults and new drivers (in states where it's available).

One of the best ways to save on car insurance for a teen or young adult driver is to join a family policy. On a family car insurance policy, your premiums will be about 20% lower than having a separate plan, according to reporting by The Balance. If joining a family plan is an option, it might be the best for a teen driver.

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