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Car Insurance Quotes for Bad Credit: Quotes, Discounts for 2022

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Last Updated: January 2022

Bad credit can wreak havoc in all areas of your life and especially your finances. If you have less-than-perfect credit, lenders won’t consider you for a loan, and auto insurance companies may consider you high-risk. Therefore, you may find it hard to get affordable car insurance.

Even with poor credit, you still have options for affordable coverage. You will still likely pay more for insurance premiums than drivers with good credit, but Insurify can help you with comparison-shopping and help you find cheap car insurance.

Car Insurance Quotes for Drivers with Bad Credit

Even if you are a good driver, you will pay a higher rate for insurance if you have bad credit. So we’ve done the homework to help you find quotes for cheap auto insurance that won't break the bank. Here are 10 companies offering low-cost auto insurance for drivers with bad credit.

Insurance Company Cheapest Monthly Quote for Drivers with Bad Credit
Metromile $144
Farmers $153
TSC Direct $165
Mile Auto $175
Foremost Signature $176

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Most Expensive Car Insurance Companies for Drivers with Bad Credit

As difficult as it is to find the cheapest car insurance rates if you have bad credit, some insurers make the job even more difficult with higher-than-average insurance rates. We did some homework to find out which car insurance companies were the most expensive. Here is a list of 10 auto insurers charging the highest rates for car insurance to drivers with low credit scores.

Insurance Company Monthly Quote for Drivers with Bad Credit
Arrowhead $819
Everest National $757
Pronto $745
Texas Ranger $540
Quantum $521

Cheapest States for Car Insurance with Bad Credit

Where you live may factor into how much you pay for car insurance. For example, some locations have higher vandalism, car theft, and accidents rates, so drivers who live in these locations pay higher auto insurance rates.

Here are the 10 cheapest states, along with the average rates for drivers with bad credit.

State Cost of Auto Insurance
New Hampshire $153
Hawaii $165
North Carolina $170
Maine $176
North Dakota $179

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Discounts for Drivers with Bad Credit

Make sure you take advantage of any discounts available to you when you apply for auto insurance to help you find the best rates. For instance, you can qualify for a bundling discount by combining your home and auto insurance coverage. Here are a few other discounts you may want to see if you qualify for:

  • Good Student Discount: Many insurers give discounts to students with a 3.0 or B grade point average or better. A typical good student discount is around 10 percent.
  • Good Driver Discount: If you are accident and ticket-free, you could receive anywhere from a 10 to a 30 percent discount on your car insurance.
  • Military Discount: Many car insurance companies provide full-time, retired, or active duty military members up to a 25 percent discount on their auto insurance.
  • Low Mileage Discount: If you only drive a few miles to work each day or less than 7,500 miles per year, you could qualify for a low mileage discount.
  • Anti-theft Device Discount: If you have an anti-theft device like a security system or VIN etching, you may save up to 15 percent on your auto insurance premium.

You can also save by reviewing your coverage options and choosing a higher deductible for full-coverage car insurance (comprehensive and collision). For example, did you know that raising your car insurance deductible could help lower your car insurance premium by as much as 10 percent?

Check with the insurance company to see if you qualify for any other driver discount. Many top auto insurers like GEICO, Nationwide, and Progressive offer attractive car insurance discounts to help you save money. You can always find the best car insurance rates by using Insurify to compare quotes, no matter your credit score.

Tips for Cheaper Car Insurance with Bad Credit

The bottom line is that some insurance companies will factor in your credit score in addition to your driving history when determining the price you pay for auto insurance. However, you shouldn't despair. You can take steps to improve your credit score and qualify for the best car insurance rates.

Here are a few ideas for improving your credit score:

Check Your Credit Score

You can use any of the three national credit bureaus, Equifax, Experian, or TransUnion, to check your credit report and FICO score to find out if your credit report contains inaccurate information. Then, contact the credit bureau about having inaccuracies removed to better your score. Finally, you can check with the Federal Trade Commission for more information about obtaining your free credit report.

Keep Credit Card Balances Low

Don't max out your credit cards, and aim for 30 percent or less credit utilization; additionally, you should strive to pay your credit card balances in full each month. If you can't pay your balances in full each month, at least pay more than the minimum payment due.

Avoid Making Late Payments

Focus on your credit card activity to help improve your credit score and avoid making late payments since payment history is a whopping 35 percent of your credit score. A few simple steps can help you avoid making late payments, including signing up for auto-pay for your bills and setting yourself payment reminders on your phone or calendar.

Consider Debt Consolidation

If you have several high-interest loans, you may want to consider debt consolidation by taking out a loan to pay off your other loans. You will only have one payment to deal with, and you may be able to get the loan at a lower interest rate.

Shop Around for Car Insurance

Don't get discouraged. In time, as you improve your credit score, you will qualify for cheaper car insurance rates. However, if you don't have the best credit score, use Insurify to shop around for auto insurance to make sure you find a company that will offer you comprehensive auto insurance coverage at affordable car insurance rates.

Frequently Asked Questions

  • Credit scores can range anywhere from 300 to 800 and are divided into tiers: poor, fair, good, very good, and excellent credit. Car insurance companies consider anything above 700 a good credit score, and a credit score of 500 or below is regarded as a bad credit score for car insurance. Therefore, drivers with a credit score of 500 or below will have higher car insurance costs.

  • Auto insurers justify using credit-based scoring with insurance industry research that shows that people with higher credit scores are less likely to file claims and drivers with lower credit scores are a higher risk to insure. However, most states will not allow insurance companies to use a credit score as the sole determining factor for auto insurance rates.

  • No, you cannot avoid telling the insurance company about your credit score. Even if you omit this information when completing your insurance application, the insurance company will likely do a credit check and find out anyway.

  • Insurance providers use your auto insurance score to determine how likely you are to file an insurance claim. The insurer uses your credit score along with methodology involving several other factors (such as payment history, amounts owed, length of credit history, new credit, types of credit) to determine the rate you pay for a car insurance policy.

Cheap Car Insurance for Bad Credit: It’s Possible

No one wants to pay more for car insurance. Unfortunately, high-risk drivers with tickets on their driving record and low credit scores have higher car insurance rates. So consider cleaning up your driving by taking a safe driver course and taking steps to improve your credit rating. In no time, you will find yourself qualifying for cheaper car insurance rates.

The best way to save on auto insurance is to shop around for the best deal. When you compare multiple insurance providers, you can see the best rates for the coverage options you choose. You want the most comprehensive coverage available for the most affordable rates.

Until you improve your poor credit score and qualify for lower rates, you can use Insurify to compare coverage and find the best car insurance premiums for drivers with less-than-perfect credit.

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Methodology

The car insurance quotes displayed are based on an analysis of Insurify’s database of over 40 million quotes from 500 ZIP codes nationwide. To obtain representative rates, Insurify’s data science team performs frequent comprehensive analyses of the factors car insurance providers weigh to calculate rates including driver demographics, driving record, credit score, desired coverage level, and more.

Insurify’s analysis also incorporates the Insurify Composite Score (ICS) assigned to each insurance provider. The ICS is a proprietary rating that weighs multiple factors reflecting the quality, reliability, and health of an insurance company. Ratings used to calculate the ICS include Financial Strength Ratings from A.M. Best, Standard & Poor’s, Moody’s, and Fitch; J.D. Power ratings; Consumer Reports customer satisfaction surveys and customer complaints; mobile app reviews; and user-generated company reviews. 

With the above insights and ranking methods, Insurify is able to offer car insurance shoppers insight into how various insurance providers compare to one another in terms of both cost and quality. Note, actual quotes will vary based on unique attributes including the policyholder’s driver history and their garaging address.