If you have bad credit, finding affordable car insurance can seem like a daunting task. However, there are many ways to get car insurance for bad credit and protect yourself on the road.
Here, we will break down some of the best options for bad credit car coverage, so you can find an insurer that fits your needs.
Keep in mind that while having bad credit may increase your premiums, it is still essential to have car insurance to protect yourself and your vehicle. Let’s take a look at some of your options.
Bad Credit Car Insurance—How It Works
This insurance works the same way as regular car insurance, but with a few key differences.
For one, car insurance companies will typically charge higher rates for bad credit drivers than their counterparts who serve drivers with good credit. This is because those with poor credit are seen as higher-risk customers and thus pose a greater financial risk to the insurer.
In addition, these insurance companies may require a higher down payment than those catering to drivers with good credit. This is again because an insurer wants to minimize its financial exposure in case of a claim.
Finally, companies offering car insurance for bad credit may place stricter limits on coverage than those who serve drivers with good credit. Again, an insurer wants to ensure it doesn’t end up paying out more in claims than it has to.
Despite these differences, bad credit car coverage works just like regular car insurance. You will still need to purchase a policy from an insurer, and you will be required to pay premiums.
If you have a bad credit score, it is vital to shop around for the best rates possible, as you may be able to find a company that is willing to work with you despite your poor credit history.
Can You Get Car Insurance With Bad Credit?
It is possible to get auto insurance with bad credit, although it may be more expensive and difficult to find a policy. Insurance companies often use credit scores to help determine rates. So, those with lower scores may pay more for their coverage.
It’s crucial to compare rates from multiple insurers before purchasing a policy. Those with bad credit may also want to consider working with a broker specialized in finding coverage for high-risk drivers.
You’re more likely to find the most affordable car insurance policy by shopping around and getting multiple quotes.
How Much to Expect Car Insurance to be With Bad Credit Rating
The national average auto insurance premiums for drivers with poor credit come to $3,622 per year. Since the average car insurance cost is $1,630, that means a driver with bad credit could pay as much as $1,992 more in auto insurance costs than someone with excellent credit.
Insurance companies often use credit scores to determine rates, so having a poor credit rating can significantly impact the amount you pay for car insurance.
There are a few things you can do to offset the higher costs of car insurance with bad credit. One option is to shop around and compare rates from different insurers. Another is to look for discounts that could help lower your premium.
Some insurers offer discounts for good drivers, low mileage car insurance, and more. Finally, you can try to improve your credit score over time to get more favorable rates in the future.
Despite the challenges, it is possible to find good companies for bad credit auto coverage. The following section uncovers what these companies are, so let’s check it out.
Best Car Insurance For Bad Credit—Expert’s Choices
If you are looking for the best bad credit car coverage, you will want to consider companies specializing in offering high-risk drivers coverage.
Namely, these companies include GEICO, Nationwide, USAA, Progressive, and Allstate. As a matter of fact, each of these companies has different rates and coverage options. Therefore, it’s essential to compare them before choosing one.
GEICO Car Insurance for Bad Credit
If you have bad credit, you may be worried that you won’t be able to get affordable car insurance. But GEICO understands that your credit score is just one factor in determining your rates.
We found that the company offers a variety of coverage options and discounts that can help you get the most affordable coverage possible, even if your credit isn’t perfect. In fact, it only raises rates by 37% for drivers with bad credit compared to policyholders with average credit.
So, no matter what your credit score is, you can be sure you’re getting a fair rate when you insure with GEICO.
Nationwide Bad Credit Auto Insurance
We highly recommend Nationwide, as it offers car coverage for bad credit for drivers who may need a little extra help.
We can assure you that, with Nationwide, you can get the coverage you need to protect yourself and your family on the road. As a matter of fact, if you have poor credit, Nationwide can still help you save. In other words, Nationwide raises rates for car insurance for poor credit by 27%.
We were also delighted to learn that the company offers premium reconsideration for extraordinary life circumstances like:
- divorce
- overseas deployment
- catastrophic emergencies
- other events
Moreover, our team found that Nationwide has strong customer service scores, so you can be sure you’re getting the service you deserve.
Get the coverage you need and the peace of mind you deserve with Nationwide’s car coverage for bad credit.
USAA: Bad Credit Car Insurance
If you are on the market for car insurance and have bad credit, we believe that USAA is a great option to consider.
Moreover, USAA operates in every state and Washington, D.C., but offers quotes and policies to a more limited group: active military members, veterans, and some of their family members.
However, this doesn’t mean USAA’s rates are higher for car insurance for bad credit. In fact, our team found that USAA actually has some of the lowest rates across several driver demographic classifications, including:
- drivers with poor credit
- teen drivers
- senior drivers
- drivers with an accident or a speeding violation on their record
For example, we were thrilled that USAA’s rates for drivers with poor credit are 28% lower than the national average. So, if you’re looking for a car insurance company that will give you a great rate regardless of your credit history, USAA is worth checking out.
Progressive Car Insurance for Bad Credit
Progressive is yet another company that can provide people with poor credit with car insurance. Although the company doesn’t specialize in insuring high-risk drivers, our team learned it offers SR-22 filing for those who need it.
Additionally, Progressive offers features, like its deductible savings bank, which can lower your comprehensive and collision deductible for every policy period you remain claims-free.
While Progressive is one of the best insurance companies for bad credit, it is essential to note that it ranked second-to-last in the 2021 J.D. Power U.S. Auto Claims Satisfaction Study, so you may want to consider other options if customer satisfaction is a priority for you.
While Progressive charges higher rates for drivers with bad credit than GEICO, it is still in line with other major insurers.
Allstate: Car Coverage for Bad Credit
Allstate offers direct auto insurance with no credit check that can help you get the coverage you need at a price you can afford.
Thanks to its competitive rates and excellent customer service, Allstate ranks high in various ratings. So, if you’re looking for a car insurance company that can provide you with the coverage you need, Allstate is a good option to consider regardless of your credit score.
Cheap Car Insurance For Bad Credit—Based on Ratings
Bad credit can make it difficult to find affordable car insurance. However, a few companies specialize in providing coverage for those with less-than-perfect credit.
Nationwide, GEICO, Mercury, and Amica are all highly rated for affordable rates and excellent coverage options. All four of these companies offer a variety of coverages that can save you money on your car insurance premiums.
Remember to compare rates and coverage options before making a final decision. With a little bit of research, you can find the perfect policy to fit your needs and budget.
Nationwide
If you’re looking for cheap full coverage auto insurance for bad credit, we highly recommend Nationwide. Its rates are among the lowest for poor credit, at $1,760 per year.
Our team found that across the states that allow credit rating to factor into car insurance rates, Nationwide only raises rates by 27%.
Moreover, what you might also like is that if you find yourself in an extreme situation, Nationwide can help you save even more with its premium reconsideration program. It helps drivers who have experienced catastrophic emergencies, overseas deployment, divorce, and other events.
Get a quote from Nationwide today and see how much you can save.
GEICO
If you’re one of the millions of drivers with bad credit, you probably seek affordable car insurance for a bad credit rating. There is good news—GEICO offers 28% lower insurance than the national average.
On average, drivers with a poor credit score can expect to pay just $1,810 per year with GEICO. That means you could annually save a lot of money on your car insurance premium.
Get a free quote today and see how much you could save. You could be driving down the road with peace of mind and more money in your pocket—in no time.
Mercury
If you have bad credit, you may think it’s impossible to find affordable car insurance with a bad credit rating. But Mercury Insurance believes everyone deserves access to quality coverage—no matter their credit score.
The company offers excellent rates for both safe and high-risk drivers, so you can get the protection you need at a price you can afford.
Mercury’s average annual full coverage premium with poor credit is just $2,034. Mercury is a great choice if you’re looking for a car insurance company that will give you the best rate possible.
Amica
If you’re like most people, you’re probably constantly on the lookout for ways to save money. Looking for ways to save on bad credit car insurance? Check out Amica’s average annual premium with poor credit—just $2,125.
In the states where credit is a thing, Amica will punish you more for bad credit than for an accident. However, this is still cheaper than many other providers that use credit as a factor in their pricing.
You should look around before signing up for a specific provider and taking steps to improve your credit to find long-term savings.
The Best No Credit Check Car Insurance Companies
Some car insurance companies don’t require a credit check, and we’ve reviewed the best ones. Whether you have bad credit or no credit, you can still get the coverage you need.
Cure
Cure is one of the best car insurance companies without a credit check out there. The company believes that everyone deserves to pay a fair insurance rate, regardless of their education level, salary, or credit score.
That’s why Cure is one of the insurance companies that do not use credit scores in its application process. This makes it easier for drivers with bad or no credit to get approved.
Cure is only available in a handful of states—New Jersey, Pennsylvania, and Michigan—but it’s committed to providing drivers in those states with the best possible rates. So, if you’re looking for car insurance without a credit check, Cure is worth considering.
Dillo
Another no credit check car insurance company is Dillo. It is a car insurance provider that is available in Texas. This company doesn’t use credit scores or even accident history to make insurance approval decisions.
This means you can still apply for coverage with Dillo no matter your credit score. Just because you have bad credit doesn’t mean you have to pay more for car insurance.
If you live in Texas and are looking for car insurance, be sure to check out this no credit check auto insurance company. You may be surprised at how easy it is to get coverage, regardless of your credit score.
Summary
So, what have we learned about car coverage for bad credit? First and foremost, it exists. And if you’re one of the millions of drivers with less-than-stellar credit, don’t despair.
Plenty of companies will be happy to take your money and provide you with car insurance, even with no credit check of your driving record. But before you go ahead and sign up for coverage, make sure you know exactly what you’re getting into.
Compare quotes from several insurers, and read the fine print to see what’s covered. You may find that another policy offers more bang for your buck—even with a few dings on your credit score.
At the end of the day, having bad credit doesn’t have to mean that you are ineligible to get coverage.
Car Insurance for Bad Credit – People Also Ask
Does poor credit affect car insurance?
The answer is yes. In most states, your credit score is one of the factors that insurers use to determine your rates.
That said, it’s not the only factor, so even if you have bad credit, many companies may still provide you with decent car insurance rates. Moreover, in some states, insurers are not allowed to use your credit score when determining rates.
Do all auto insurance companies check credit history?
Not all auto insurance companies check credit history, but many do. For instance, two of the best companies that don’t check your credit are Dillo and Cure.
However, as credit history is one of the factors that insurers often use to determine rates, it can impact your premium.
So, if you’re shopping for auto insurance, it’s a good idea to check with different companies. That way, you can see if they consider credit history when setting rates.
Does State Farm run your credit?
If you are applying for car insurance with State Farm, they will most likely pull your credit report. That’s because insurers believe that your credit score is a good indicator of how likely you are to file a claim.
Of course, this is just one factor that insurers use to determine your rates, so it’s not the be-all and end-all.
Do car insurance companies check credit?
Most car insurance companies will check your credit before offering you a policy. They do this because people with lower credit scores tend to file more claims, and the insurance company wants to minimize its risk.
Car insurance for bad credit drivers is still possible, but it will probably be more expensive. Furthermore, some insurers offer programs that allow drivers with poor credit to improve their rates over time by proving they are responsible drivers.
