No-Down-Payment Car Insurance (2025)
No-deposit car insurance doesn’t actually exist, but you still have plenty of opportunities to get very cheap car insurance.
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Written bySarah Archambault
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Experienced personal finance writer
Background working with banks and insurance companies
Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.
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Edited byEvelyn Pimplaskar
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10+ years in insurance and personal finance content
30+ years in media, PR, and content creation
Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.
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Reviewed byDaniel Roccato
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30+ years in financial services
Clinical Professor of Finance, University of San Diego
Dan is a well-recognized and widely quoted financial services expert, regularly appearing in a variety of national and local media as a subject matter expert.
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Data reviewed byKonstantin Halachev
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7+ years experience in data analysis
Ph.D. in Computational Biology
Konstantin has led data teams across multiple industries, including insurance, travel, and biology. He’s led Insurify’s engineering team for more than three years.
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Table of contents
Almost every reputable car insurance company will require some sort of deposit or down payment before providing you with coverage. But if you’re strapped for cash, some insurers require only the first month’s premium as a deposit, rather than a separate fee.
You can find other ways to save money on car insurance — including discounts, payment plans, and comparison shopping — to get the lowest rates available to you.
Quick Facts
If you choose to pay for your new car insurance policy in installments, the insurance company will require a down payment to initiate the policy.[1]
Your down payment may be the first month’s premium paid in advance or a percentage of the total premium.
A down payment counts toward your total premium. It’s not an additional fee.
What to know about very cheap car insurance with no deposit
Car insurance with no deposit or down payment doesn’t exist, as insurers don’t want to take on the risk of insuring you without some sort of payment.
The misconception of no-deposit car insurance may come from the differences in down payment amounts among companies and for different drivers. Deposit amounts can vary based on many factors, including the insurance company, your state, driving history, credit history, and more.
For example: Let’s say your insurer last year only required you to pay the first month’s installment as a down payment. But this year, you got into an at-fault accident, and now your new insurer wants more than one month’s premium as a deposit.
You may think the deposit amount is your first month’s premium plus an added fee — but it’s really just a higher percentage of the total premium.[2]
Expert Insight
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Mallory Mooney
Director of Sales and Service, Insurify
If keeping your initial payment low is a priority, it can help to review the different payment plan options carriers offer. Some companies provide lower down payments if you choose more frequent pay schedules, like bi-weekly or quick second payments.
Why do insurance companies require a down payment?
Insurance companies require a down payment because it protects them from significant risk during the first month of the policy. When you sign up for car insurance coverage, your insurer is agreeing to take on financial responsibility for various claims outlined in the policy, so it needs a deposit or down payment to offset that risk.
Is no-deposit car insurance a scam?
You should be wary of any car insurance company offering no-deposit car insurance. No reliable insurance company will give you a policy without some sort of down payment.
Keep an eye out for insurance companies that require the first month’s payment as a deposit rather than a separate charge. They may advertise the policy as “no deposit” or “no down payment car insurance” since the money goes toward your policy costs, but you’ll still need to pay this money before your coverage kicks in.
Important Information
If a company claims to offer true no-deposit or zero-down car insurance without requiring any money up front, it’s likely a scam. No matter where you buy your insurance, it’s smart to read reviews and check ratings before committing to a policy.
How to lower your down payment
If you want to find the best deal on car insurance and lower your down payment, you can do a few things to save money. Follow these tips to decrease your deposit and monthly premium:
Compare multiple car insurance quotes from different companies.
Consider pay-as-you-go insurance.
Ask for discounts.
Consider liability-only coverage vs. full coverage.
Compare multiple car insurance quotes
You should always compare car insurance quotes before buying a policy. Every insurer calculates rates differently, and each driver has unique characteristics, such as their location, driving record, and age, so insurance premiums can differ drastically. The cheapest car insurance company for you may be different from the cheapest option for your parents, for example, given their age.
Since most insurers will ask for the first month’s premium as a deposit, finding very cheap car insurance through quote comparison can lower your down payment.
Find Coverage with a Low Down Payment
Minimum-coverage policies start at $31 per month
Secure. Free. Easy-to-use.
Based on 7,669+ reviews
4.8/5
Consider pay-as-you-go insurance
If you don’t drive much, you may benefit from pay-as-you-go or pay-per-mile insurance. These types of insurance are similar, though not entirely the same.
Pay-as-you-go insurance — also known as usage-based insurance — charges you based on how much and how well you drive.[3] Pay-per-mile insurance charges you based on how many miles you drive on top of a base rate.
These types of policies typically have lower down payment requirements. But they’re not without risk. You may not get the same level of coverage as you would with typical full-coverage car insurance. With pay-as-you-go insurance, the insurer can even penalize you for poor driving, so consider how carefully you drive before signing up.
Here are the top insurers for pay-as-you-go car insurance.
Mile Auto: Best for pay-per-mile coverage
| User Reviews | 4.1 |
|---|---|
| IQ Score The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores. | 8.8 /10 |
| Liability Only Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages. | $63/mo |
| Full Coverage Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible. | $100/mo |
4.1
Best choiceBased on 139 verified guest reviews and ratings
How drivers feel about Mile Auto
Drivers appreciate the quality service but find the rates high and claim processing slow.
AI-generated from the text of verified reviews collected by Insurify
Best For
Low-mileage drivers
Senior drivers
Cheap full coverage
How drivers feel about Mile Auto
Drivers appreciate the quality service but find the rates high and claim processing slow.
AI-generated from the text of verified reviews collected by Insurify
Best For
Low-mileage drivers
Senior drivers
Cheap full coverage
Reviews (48)
Lesheka
Verified Purchase
Surprise Prices
Reviewed in on August 2025
I don’t like high bills, and they told me one price, then it was higher than before. It went from $167 to $470, which is higher than Progressive. I should go back to them, plus I have put a down payment. So I’m not pleased.
Bryan
Verified Review
Happy Customer
Reviewed in Tennessee on August 2025
I would like them to mail me annual wallet-sized insurance cards to show my coverage.
Walt
Verified Review
Typically, we don't use insurance and do not drive much. The fees we pay are absolutely reasonable.
Reviewed in Arizona on July 2025
Low rate plus monthly mileage fee. No other insurer gets even close to my monthly fee.
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
NRNAIC Index
Average amount of customer complaints relative to competitors on a 0-5 scale. A lower score represents fewer complaints.
2.18A.M. Best
A.M. Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor).
NRWhy we picked this company
Mile Auto is unlike other auto insurance companies in that it bases rates on the number of miles you drive. The company says low-mileage drivers can save up to 40% compared to a standard policy.
While Mile Auto does require drivers to report mileage, it asks for a photo of your odometer rather than track your driving with a telematics device. Your rate includes a base rate plus the rate for miles driven.
You won’t find an A.M. Best rating for Mile Auto because it doesn’t underwrite its own policies. However, it notes that its underwriter has an “Excellent” rating and its policies are backed by one of the world’s largest reinsurers.
Pros
Low-mileage drivers may see significant savings
You don't have to install a telematics device in your car
Cons
Only available in nine states
No bundling or discount opportunities
Nationwide: Best for safe drivers
| User Reviews | 4.3 |
|---|---|
| IQ Score The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores. | 9 /10 |
| Liability Only Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages. | $93/mo |
| Full Coverage Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible. | $176/mo |
4.3
Best choiceBased on 875 verified guest reviews and ratings
How drivers feel about Nationwide
Drivers appreciate the helpful and knowledgeable customer service but dislike the frequent and significant rate increases. Some also found the claims process to be slow and frustrating.
AI-generated from the text of verified reviews collected by Insurify
Best For
Usage-based savings
Accident forgiveness
Recreational vehicle coverage
How drivers feel about Nationwide
Drivers appreciate the helpful and knowledgeable customer service but dislike the frequent and significant rate increases. Some also found the claims process to be slow and frustrating.
AI-generated from the text of verified reviews collected by Insurify
Best For
Usage-based savings
Accident forgiveness
Recreational vehicle coverage
Reviews (489)
Connie
Verified Review
Not on your side!
Reviewed in Washington on August 2025
Very slow on service. Their rates are astronomical, almost $400 a month for one car.
Joseph
Verified Review
Rapid Rate Increases
Reviewed in Virginia on August 2025
Significant rate increases despite no claims or changes in risk profile.
Donna
Verified Review
Nationwide Mostly on Your Side
Reviewed in South Carolina on July 2025
Nationwide has been very good for everything except my budget.
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
641NAIC Index
Average amount of customer complaints relative to competitors on a 0-5 scale. A lower score represents fewer complaints.
0.7A.M. Best
A.M. Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor).
A+Why we picked this company
Nationwide offers one of the most widely available pay-per-mile car insurance programs. SmartMiles allows low-mileage drivers to pay a monthly base rate plus a per-mile charge each month. You participate in the program either with a telematics device that goes in your car or with an eligible connected car.
Pros
Available in all states except Alaska, Hawaii, Louisiana, North Carolina, New York, and Oklahoma
10% renewal discount available for safe driving behavior
Cons
Requires telematics tracking
Poor driving habits could negatively affect your rates
Expert Insight
Mallory Mooney
Director of Sales and Service, Insurify
For drivers looking to avoid a high initial down payment, pay-as-you-go can be a great option. These policies base your premium on actual driving habits — such as miles driven or driving behavior — and typically allow you to start coverage with a much smaller up-front payment. This approach can make insurance more budget-friendly while still providing the protection you need.
Ask for discounts
Most car insurance companies offer a variety of car insurance discounts. Consider your situation and which offers you may qualify for, such as good student, loyalty, clean driving record, and defensive driving discounts. Ask your insurance agent to check for you, or research an insurer’s website to learn which discounts it offers.
Some common auto insurance discounts include:
Safe driver
If you have no accidents, claims, or tickets, you may be eligible for this discount.
Bundling discount
Most insurance companies offer a significant discount if you buy both your car insurance policy and homeowners or renters policy from them. Bundling can lower the cost of both policies.
Multi-car
Adding a vehicle to your policy will increase your premium, so many insurers give a discount for insuring multiple vehicles on the same policy.
Going paperless
Sending paper bills and documents costs an insurer time and money, so most companies give a discount if you agree to receive policy documents and premium bills electronically.
Good student
Teens are the most expensive drivers to insure. But insurers typically offer discounts to high school or college students with good grades (usually a B average or better).
Safe vehicle
Driving a vehicle with safety features like airbags, anti-lock brakes, and lane-departure warnings could score you a car insurance discount.
Consider liability-only coverage vs. full coverage
Consider reducing your coverage level. Liability car insurance costs significantly less than full coverage. But it won’t cover damages from collisions or weather damage.
Liability coverage is only good for people who don’t drive frequently or can afford to pay vehicle expenses out of pocket. If you drive a lot and wouldn’t be able to pay for significant vehicle repairs, you should probably carry full coverage. If you took out a loan to pay for your car or lease it, your lender or leasing company will require you to carry full coverage anyway.
The following table illustrates the difference between the national average costs of liability-only policies and full-coverage car insurance.
Monthly Average: Liability Only | Monthly Average: Full Coverage |
|---|---|
| $104 | $184 |
Disclaimer: Table data sourced from real-time quotes from Insurify's 500+ partner insurance providers. Actual quotes may vary based on the policy buyer's unique driver profile.
No-deposit car insurance FAQs
If you’re on a budget, it’s possible to find affordable car insurance. Here’s some additional information that might help as you research different policies to find the best rates.
Every car insurance company will require you to pay something toward your coverage when you enroll in a policy. How much you have to pay up front will depend on multiple factors, including the insurance company, the payment plan you choose, your driving history, age, gender, and more.
Yes. You’ll have to make a payment to enroll in a Progressive car insurance policy. If you decide to pay on a monthly basis, your first month’s payment might qualify as your down payment. Keep in mind, many insurers offer a discount if you pay the entire year’s premium in advance.
Yes. Hugo is a legitimate car insurance company that offers coverage for as little as three days at a time. It has no down payment or up-front fees, although you’ll have to pay an initial premium when you start a Hugo policy. Hugo is available in 15 states.
You’ll always have to pay something up front when you buy a car insurance policy. Usually, it’s a deposit based on the payment plan you choose. Your deposit is often your first month’s premium. If you buy a short-term policy from Hugo or Seven, you’ll have to pay the entire premium up front. And while Ocho allows you to finance your down payment interest-free over the life of your policy, you’re still technically paying a deposit.
Yes. All reputable insurers require some form of payment up front before you can get coverage. This is a way for insurers to reduce risk. You can expect to pay a lump sum that covers a down payment or your first monthly payment.
Every car insurance company requires a down payment in the form of the first month’s premium. But many car insurance companies don’t require a secondary deposit on top of the initial premium, including:
This list is not exhaustive, so it’s a good idea to contact a car insurance company directly if you have questions about its down payment requirements.
COUNTRY Financial and Auto-Owners are the cheapest car insurance companies, according to Insurify data. But not every driver may be able to get coverage from these companies.
If you’re on a tight budget, it pays to shop around for affordable rates and cheap car insurance. State Farm and GEICO are two nationally available insurance companies that offer some of the cheapest policies, so getting quotes from them is certainly a good start.
Every driver is unique — rates depend on different factors, like your driving record, credit history, and ZIP code. Good drivers typically pay lower rates, while senior drivers and young drivers may pay more. You may find cheaper insurance with another company, so always compare quotes from multiple insurers before buying a policy.
OCHO is a legitimate car insurance company that helps drivers manage their down payment costs through no-interest loans. The loan can cover some or all the cost of an initial down payment. Policyholders repay the loan, plus an $80 broker fee, as part of their monthly premium payments. OCHO is currently available in Arizona, Georgia, Illinois, Texas, Missouri, New Mexico, Washington, and Wisconsin.
It’s possible to find lower-cost full-coverage car insurance. Maintaining a clean driving record and healthy credit history and choosing an inexpensive, safe vehicle can help lower your car insurance premium. Comparing full-coverage car insurance quotes from multiple insurers can also help you find a lower-cost policy.
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Sources
- Direct Auto Insurance. "About Car Insurance Down Payments."
- Progressive. "Can I get car insurance with no down payment?."
- Insurance Information Institute. "Background on: Pay-as-you drive auto insurance (telematics)."
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Sarah Archambault
Sarah Archambault enjoys helping people figure out how to manage their finances and credit. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans. Her work has been featured on Credit Karma, Experian, LendingClub, Sound Dollar and USA Today Blueprint. She also writes for national insurers, banks and financial institutions like Aetna, MassMutual, Stripe, and UnitedHealthcare.
Sarah has been a contributor at Insurify since December 2022.
10+ years in insurance and personal finance content
30+ years in media, PR, and content creation
Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.
Featured in
30+ years in financial services
Clinical Professor of Finance, University of San Diego
Dan is a well-recognized and widely quoted financial services expert, regularly appearing in a variety of national and local media as a subject matter expert.
7+ years experience in data analysis
Ph.D. in Computational Biology
Konstantin has led data teams across multiple industries, including insurance, travel, and biology. He’s led Insurify’s engineering team for more than three years.