Steps To Take If You Can’t Afford Car Insurance

Fortunately for anyone feeling the pinch of paying for car insurance, groceries, and life, there are many things you can do to afford car insurance. These include shopping around for coverage, joining someone else’s policy, and boosting your credit.

If you’re already working with a competitively-priced insurer, ask about (and negotiate for) discounts, perhaps as a reward for your driving record. If you don’t have the best record — hey, nobody’s perfect — ask about online training courses that could decrease your premiums.

You can also consider decreasing your coverage if you’re comfortable letting go of some add-ons, but don’t do this if it means settling for bare minimum insurance that could leave you financially wrecked if something were to happen.

Having insurance is critical — and driving without it is illegal, except in New Hampshire — so try these tips to get car insurance if you can’t afford it.

What to do if you can’t afford car insurance

Follow these tips to potentially save on car insurance so you can afford a policy that works for you.

1. Compare quotes from different insurers

Even the best car insurance companies don’t let people negotiate car insurance rates, but you can — and should — absolutely compare rates from various insurance providers to find cheaper options. If your renewal date is coming up and you can’t afford your current insurance, see what else is available in your area. We suggest doing this annually, even if you’re not unhappy with your insurance, to ensure you’re getting the best deal possible.

There are three main ways we recommend for comparing car insurance rates:

1. Call different insurance companies or independent insurance agents.
2. Check insurance rates directly on company websites.
3. Use a comparison website to compare car insurance rates in your area.

The easiest method is often to use a comparison website because you won’t necessarily have to fill out an online quote for each company you want pricing for. Plug in some basic information about your car and insurance needs, and the tool will give you personalized information on available rates.

2. Use discounts

Many online car insurance quotes automatically include discounts based on your information. This is why taking the time to answer every question as best as you can is worth it so you don’t miss out on any potential savings — even if the questions seem unrelated to your policy.

For example, questions about military or government affiliations have nothing to do with your car insurance policy but could lead to a potential rate reduction.

Some of the best discounts we see include:

• Bundling policies (such as for home and car insurance)
• Maintaining a clean driving history
• Practicing safe driving habits
• Having a good student on your policy (meaning they get good grades)
• Adding another vehicle to your policy
• Having a vehicle with safety equipment or features installed

If you’re not getting any discounts in your quotes, consider finding an independent insurance broker in your area. They might be able to help you find available discounts through a company that wasn’t initially included in your comparison. You can also ask your current insurer to check for available discounts that can be applied to your account.

Credit: Andrew Pentis

3. Reduce insurance coverage

Electing your state’s minimum coverage, which is typically a small amount of liability insurance, is likely your cheapest option — but it won’t provide you with the best financial protection in case of an accident or incident. (Conversely, add-ons like collision coverage, comprehensive insurance, rental car reimbursement, and more will increase your rates.)

Striking a balance between having enough insurance and saving money on your rates can give you peace of mind while keeping some cash in your wallet. Get no less than the minimum insurance you need to avoid financial hardship if you get into an accident.

We’re not recommending choosing as little coverage as possible here — just stressing the importance of knowing how much car insurance you need to feel safe and protected. There are also legitimate ways to lower your car insurance costs that don’t involve reducing your coverage. You can also opt for a higher deductible to lower your everyday rates, but this will mean banking on not needing to use it.

4. Increase your credit score

The information provided on your credit reports is used to create a rating called an insurance score, or credit-based insurance score. It’s an estimate of how well you manage your money and isn’t based on how much you make. It’s basically an extra indicator of whether you might be more likely to file a claim (drivers more likely to file claims are costlier for companies to insure), and it can impact your premiums.

Improving your credit score can help improve your insurance score, which might give you more affordable car insurance rates. Effective ways to improve your credit score include zeroing your credit card balances every month, making on-time card and loan payments, and avoiding maxing out revolving accounts.

5. Join someone else’s auto insurance policy

Piggybacking onto a friend or family member’s car insurance policy (or adding them to your policy) can help decrease your overall cost. This typically only works if the person you’re adding or joining has a clean driving record and falls within an age range that doesn’t include “high-risk drivers.”

For example, an 18-year-old driver joining the policy of a 30-year-old with a clean driving record might get better overall rates than if they were to have their own policy. But keep in mind that rates would likely skyrocket (in comparison) for the “safe driver,” so you might have to work out a fair distribution of the costs.

6. Take a defensive driving course

Taking a defensive driving course can qualify you for a discount depending on your insurance provider and where you live. Some courses are reserved for drivers over 50, but many are available to all ages. This discount requires you to take an eligible course or class approved by your state’s Department of Motor Vehicles or Department of Public Safety.

Some of these courses are online, and many review different parts of driving education, including traffic laws and driving techniques that can help you avoid accidents and protect yourself and your vehicle. Check with your insurer to see if this discount is available and, if so, what requirements there are for qualifying.

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Factors that affect car insurance affordability — and what to do about them

The main factors that affect car insurance rates include your driving record, age, credit (as allowed by your state), and the coverage you choose. If one of these factors is stopping you from affording insurance, here’s what to do about it.

Your driving record

Why it matters: Car insurance companies typically consider any recent car accidents, specifically from the past three to five years, when deciding your car insurance rates. They also consider any traffic or moving violations.

What to do about it: If you don’t have a clean driving record, consider taking a defensive driving course to help you steer clear of further incidents and decrease your car insurance rates.

Your age

Why it matters: You can’t control your age, but it’s still an important factor that affects the cost of car insurance premiums. In general, it costs more to insure young drivers — especially young men and teen drivers.

What to do about it: If you drive your parents’ car and live with them (or are a full-time college student), consider remaining on or joining their auto insurance policy if they have one. Otherwise, I recommend taking an insurer’s driving training course to try to lower your quote.

Your types of coverage, coverage limits, and deductibles

Why it matters: Most states require a minimum amount of liability coverage, but your premium will be higher if you add other types of insurance, including collision and comprehensive coverage. More add-ons typically mean more protection — at a higher cost.

What to do about it: Find the right amount of coverage for your needs and budget. Decreasing your policy limits and/or increasing your deductibles are quick ways to lower your rates.

The type of vehicle you drive

Why it matters: How much your vehicle costs can affect a car insurance policy's cost. More expensive vehicles and new cars typically cost more to cover. If your car is older or less expensive, you might get lower rates.

What to do about it: If you already have a car, exchanging it for a lower-cost option may not be an option. A more realistic solution: If you drive a newer model with specific safety features or equipment installed, you might qualify for specific car insurance discounts.

Your credit

Why it matters: Insurance companies can often use information in your credit report to predict whether you’re more likely to file a claim. If you have a good or excellent credit score, you might qualify for better rates than someone with a poor credit score or lean credit history.

What to do about it: Some U.S. states ban insurance companies from considering credit scores/history when determining your car insurance rates. If your state allows this practice and it’s increasing your rate quotes, focus on repairing your credit or boosting your score.

Where you live

Why it matters: Insurance companies adjust their rates depending on where you live. To paint a picture, the average cost of car insurance in Idaho is $932, while the average cost of car insurance in South Carolina is $2,132 in 2024.

Also, regardless of your state, living in a city compared to a more rural area typically comes with a higher risk of vehicle damage, whether from car accidents, vandalism, or theft.

What to do about it: No one expects you to pick up and move just to land a lower insurance premium. But if you think your location is increasing your rates, talk to insurers about your efforts to keep your car safe (perhaps by using a garage) or maintaining an accident-free record.

Your gender

Why it matters: Women tend to have lower car insurance rates than men, especially in the case of young drivers. This is due to statistical analysis illustrating that women tend to have fewer car accidents than men. But insurance rates between men and women tend to even out as people age.

What to do about it: If you’ve previously shopped for car insurance as an individual, compare rates for a joint policy with your partner or spouse, if applicable.

How much you drive

Why it matters: More driving means more chances of a car accident. So, putting a lot of miles on your car for daily commutes could mean higher rates.

What to do about it: You’re probably looking at lifestyle shifts for this one. Explore alternative transportation methods, such as carpooling to work with a colleague and riding your bicycle more often. Also, consider only using your car to go to the store and run necessary errands.

What happens if you drive without insurance?

Depending on the circumstances and where you live, these are some possible consequences of driving without a current insurance policy:

• Paying a fine
• Having your license and/or registration suspended
• Getting your car impounded
• Spending time in jail
• Paying fees to reinstate your license and/or registration
• Having to submit an SR-22 form

In some states, your first offense for driving without car insurance could immediately result in a suspended license or registration. And that’s on top of having to pay fines or fees.

The exact amount you might have to pay in fines varies, but it could get up to $5,000. And your license could be suspended for months or even years. Even worse, some states could put you in jail for up to a year or more.

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Bottom line

Auto insurance coverage can be expensive, but options are available if you can’t afford car insurance. This includes uncovering discounts, potentially reducing your insurance coverage, and comparing rates between different companies.

Having a minimum amount of insurance is a legal requirement for most people if you plan to drive a vehicle. The possible consequences of driving without insurance are severe and include having your license suspended or going to jail, so it’s not worth considering.

To compare coverage options in your area, check out our page on the best car insurance.

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