What insurance company is usually the cheapest? (2024)

What insurance company is usually the cheapest?

State Farm

State Farm is the cheapest car insurance company overall according to NerdWallet's analysis, with an average rate of $39 a month for minimum coverage.

Both Geico and Progressive offer cheap car insurance to drivers across the country. Geico's rates are typically lower overall, but Progressive tends to offer better prices to high-risk drivers. High-risk drivers are those with a recent DUI, at-fault accident or speeding ticket on their driving record.

Geico tends to have cheaper rates than Allstate, but Allstate offers more extensive coverage options and flexible roadside assistance packages, which come at a higher premium. Both companies offer similar coverage and discounts.

State Farm Car Insurance | Surprisingly great rates that fit any budget.

Some of the car insurance inflation in the US can be explained by a pause in premium increases during the pandemic and the widespread parts shortages that hobbled the entire auto industry. But much of the cost pressure for insurers is because vehicles have taken a high-tech turn.

The insurer has some of the most affordable rates — our research found that Geico's average rates tend to be 26% cheaper than the national average of $2,508 for good drivers. This is in addition to the savings that drivers can get by participating in the company's discount offerings.

Overall, Progressive has cheaper average car insurance rates than Allstate. The average national cost for full-coverage auto insurance at Progressive is $1,611 per year, while Allstate is $2,088 per year. However, with its long list of discounts, Allstate can be a cheaper option for some drivers.

Geico is so cheap because it sells directly to the consumer. Geico also offers many discounts that help customers save even more on top of its already-low premiums.

Who is Geico's biggest competitor?

State Farm is currently the largest auto insurer in the U.S. according to the National Association of Insurance Commissioners (NAIC), closely followed by Geico.

Many factors contribute to Allstate being expensive, including rising costs for insurance companies and the way it pays its agents. Damage claims and payouts also factor into its higher-than-average rates.

Geico and USAA are among the insurance companies that are cheaper than Allstate.

Yes, $200 per month is higher than average for car insurance.

The national average cost of car insurance is $1,982 per year, according to NerdWallet's 2024 rate analysis. That works out to an average car insurance cost of about $165 per month.

Age is one of the most important factors insurance companies consider when coming up with a car insurance quote because young people have less driving experience. Drivers under the age of 25 tend to pay the highest car insurance rates. Rates start to increase again after age 60.

Although you can't negotiate your car insurance rate, you're not contractually obligated to stay with your insurance company. If you find a cheaper rate elsewhere, you can switch insurance providers. Depending on when you cancel and the fine print of your car insurance policy, you could incur fees.

On average, drivers with poor credit pay 118 percent more for full coverage car insurance than those with excellent credit. California, Hawaii, Massachusetts and Michigan prohibit or limit the use of credit as a rating factor in determining auto insurance rates.

How much does the average person spend on insurance per month?

If you notice your car insurance keeps going up each time you renew, it could be from rising car insurance rate trends over time. These are often caused by factors outside your control, like increases in the costs to repair and replace vehicles or increases in claims and claim severity in your area.

State Farm is so expensive because car insurance is expensive in general, due to rising costs for insurers. But at $718 per year, the average State Farm car insurance policy is actually cheaper than coverage from most competitors. In fact, State Farm is one of the cheapest car insurance companies nationally.

No, The General is not cheaper than Geico for car insurance. A minimum-coverage car insurance policy with The General costs $2,196 per year, on average, while a minimum-coverage policy with Geico costs an average of $856 per year. Full coverage from Geico costs less than The General's coverage, too.

In our 2023 review, we give State Farm a 9.3 out of 10.0 for cost, while Allstate receives only a 7.4. As you can see in the chart below, State Farm's average annual rate falls well below the national average, while Allstate's is significantly higher.