When you purchase car insurance, you must make an initial payment to start your coverage. While you can’t find cheap car insurance with no down payment, you can find cheap car insurance with a low down payment.
We at the Home Media review team will explain insurance down payments and walk you through the options to find a more affordable car insurance policy. To find the best rates, we recommend requesting quotes from the best car insurance companies in the industry.
What is no down payment auto insurance?
Technically, there is no such thing as no down payment car insurance or “free car insurance”. All legitimate car insurance policies require you to pay money up front. If an insurer offers “low deposit insurance” or “low deposit car insurance,” the deposit is the first month’s premium. In most cases, the down payment is simply a percentage of the total premium and not a separate fee.
What are my car insurance payment options?
Usually, you pay your auto insurance premium in a lump sum or in installments with a payment plan. If you choose to pay in monthly installments, you can pay more in the long run. Paying in six-month or yearly installments may save you money, especially if your insurer offers a discount for paying in full.
Why do car insurance companies require a down payment?
A down payment is the money needed to start your car insurance policy. Once you’ve made that first payment, you’re covered by the policy you purchased. If you have not made payment for your car coverage, you will not be able to make a claim or receive a payout from your insurer. Auto insurers take risk, so by asking for a down payment, they immediately offset some of that risk.
How Much Are Auto Insurance Down Payments?
Down payments vary based on government regulations, the policy you purchase, and insurance company guidelines. Higher risk driverspeople with bad credit or drivers who need it file SR-22s may have to make higher down payments. The type of vehicle you insure can also determine the size of your down payment. Newer and more expensive vehicles have higher insurance down payments.
How can I save money on car insurance?
There are some things you can do to pay lower car insurance rates. In the sections below, we’ve outlined a few steps to help you find affordable auto insurance.
Get quotes from the cheapest car insurance companies
To find the best rates, compare car insurance from a number of providers. The average estimates below are based on a married 35-year-old driver with a clean driving record and good credit.
Cheapest liability insurance providers
Based on our estimates, USAA and Auto-Owners Insurance offer the least expensive liability insurance policies on average. Your rates can vary significantly from these prices based on your age, driving history, credit score and more.
*USAA is only available to active duty military personnel, veterans and their immediate families.
Cheapest insurers with full coverage
We found that USAA and Erie Insurance offer the lowest average annual premiums for car insurance with full coverage.
Look for insurance discount opportunities
Most insurers have at least a few discount options that many policyholders may qualify for. Here are some of the most common auto insurance discounts insurers offer:
Insurance discount based on use
Your provider may reduce your monthly premium if you opt for one telematics insurance program. Also known as usage-based insurance, these programs use plug-in devices or carrier mobile apps to track your driving while you’re behind the wheel. Many programs track your speed, how hard you brake, how long you drive and more. Depending on your driving style, some programs may increase your premium.
The best way to pay less for car insurance is to drive safely. Insurance costs for drivers with speeding or DUI convictions are much higher than the rates for drivers with a good driving history. Always obey the speed limit, pay attention to your surroundings and limit your phone use while driving.
Improve your credit score
If you have bad credit, you probably pay a lot more for auto insurance than someone with good credit. Work on improving your credit score and your car insurance premium will decrease.
Cheapest car insurance without a down payment: conclusion
Basically, you won’t find a legitimate auto insurance policy that doesn’t require a down payment. You can still get whole cheap car insurance by driving safely, looking for auto insurance discounts and getting free quotes from the cheapest auto insurance companies.
Top car insurance recommendations
We recommend getting auto insurance quotes from State Farm and Geico.
State Farm: Editors’ Choice
State Farm has built a strong reputation in the auto insurance industry by offering affordable rates and strong customer service. Based on our research, State Farm full coverage insurance is about 14% lower than the national average. The company holds one A++ financial strength review of AM Best and a A+ rating from the Better Business Bureau (BBB).
read more: Review of state farm insurance
Geico: Affordable for most drivers
Geico is the second largest insurance company in the country. According to our rate estimates, Geico full coverage insurance is about 24% less expensive than the national average. Due to the low insurance rates, we give Geico an overall rating of 9.1 out of 10.0. Geico also has an AM Best financial strength rating of A++demonstrating its ability to write claims, and a A+ rating from the BBB.
read more: Geico insurance statement
Cheapest car insurance without a down payment: frequently asked questions
Below are frequently asked questions about the cheapest car insurance with no down payment.
Because consumers trust us to provide objective and accurate information, we’ve developed an extensive rating system to formulate our ranking of the best auto insurance companies. We’ve collected data from dozens of auto insurers to rate the companies on a wide variety of ranking factors. The end result was a total score per provider, with the insurers with the most points at the top of the list.
Here are the factors our ratings take into account:
- Cost (30% of the total score): Auto insurance estimates generated by Quadrant Information Services and discount opportunities were both considered.
- Coverage (30% of total score): Businesses that offer different options for insurance coverage are more likely to meet consumer needs.
- Reputation (15% of total score): Our research team took into account market share, assessments from industry experts and years of experience when giving this score.
- Availability (10% of the total score): Auto insurance companies with more state availability and few eligibility requirements scored highest in this category.
- Customer experience (15% of total score): This score is based on the number of complaints reported by the NAIC and customer satisfaction ratings reported by JD Power. We also considered the responsiveness, friendliness and helpfulness of each insurance company’s customer service team based on our own customer analysis.
*Data correct at time of publication.