Cheap Car Insurance for Low-Income Drivers in Michigan

What is low-income car insurance in Michigan?

Michigan doesn’t have specific low-income auto insurance policies. But you can find affordable car insurance by qualifying for discounts based on your driving record and adjusting your coverage for a lower price.

Choosing your coverage is important. A full-coverage policy protects your car from theft, vandalism, adverse weather events, and collisions with objects and vehicles, but it’ll cost more each month.

But you can buy less coverage. A minimum liability policy is the cheapest auto insurance in Michigan because it just provides enough coverage to meet the legal requirements. It won’t cover your vehicle damages, but it’ll have a lower monthly premium.

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Cheapest car insurance in Michigan

USAA offers Michigan drivers the cheapest car insurance in the state, at $69 per month. Meanwhile, the average premium in Michigan for a liability-only insurance policy is $129 per month. 

Average car insurance rates in Michigan are significantly higher than in the rest of the U.S. Even though recent Michigan auto insurance reform is bringing premiums down, rates remain high for several reasons.^[1]

Michigan car insurance is expensive in part because it’s a no-fault state. This means that every driver’s minimum coverage must include personal injury protection (PIP) to pay medical bills resulting from an accident, no matter who’s at fault. Many states don’t require drivers to have this coverage.

Michigan law now prohibits car insurance companies from using ZIP codes to set rates.^[2] That said, the state’s largest city, Detroit, has the highest premiums, likely due to the city’s high rate of vehicle theft and population density.^[3]

This table shows the cheapest average liability insurance rates from some of the top auto insurers in Michigan.

The below rates in Michigan are estimated rates current as of: Thursday, July 9 at 5:00 PM PDT. 

Insurance Company	Average Quote: Liability Only
Auto-Owners	$69
USAA	$69
Chubb	$75
National General	$105
Progressive	$111
Safeco	$111
Liberty Mutual	$127
Bristol West	$136
Direct Auto	$138
State Farm	$142
Travelers	$164
Insurify Car	$165
GEICO	$168

Disclaimer: Table data sourced from real-time Michigan car insurance quotes from Insurify's 500+ partner insurance providers and quote estimates from Quadrant Information Services. Actual car insurance quotes in Michigan may vary based on the policy buyer's unique driver profile.

Car insurance options for low-income drivers in Michigan

Low-income Michigan drivers can lower car insurance premiums by inquiring about discounts, adjusting coverage levels, and comparing quotes from many insurers, including those specialized for high-risk drivers.

• Discounts: See if you and your family qualify for common savings opportunities, like good student, bundling, and good driver discounts. Consider signing up for a telematics program to benefit from safe driving.

• Coverage adjustments: You can choose a lower PIP limit of $250,000 or $500,000 instead of Michigan’s default unlimited coverage. If you have Medicare or Medicaid, you may be able to opt out of PIP coverage entirely to lower your rates.^[4]

• Non-standard insurance: If you have serious driving infractions on your record, it can be more difficult to find affordable car insurance. Consider coverage from companies that will help you maintain SR-22 coverage if needed. USAA and Auto-Owners provide the cheapest coverage for Michigan drivers with a past driving under the influence (DUI) conviction, according to Insurify data.

• Assigned risk plan: Michigan doesn’t have a car insurance option specifically for low-income drivers, but it does have an assigned risk plan: the Michigan Assigned Claims Plan (MACP).^[5] If you’re in an accident, don’t have insurance, and don’t have any other avenues of obtaining insurance, you can file a claim with the MACP for PIP.

Minimum car insurance requirements in Michigan

Michigan’s minimum-coverage car insurance has the following three main components:^[6]

• Personal injury protection (PIP): Covers your medical expenses and wage loss that you suffer in any accident, regardless of fault.

• Property protection insurance (PPI): Protects property that you damage with your car, including properly parked cars.

• Residual liability insurance: Bodily injury liability protection covers accidents you cause when damages exceed the injured party’s PIP limits.^[7] Property damage liability applies only to out-of-state accidents.

A minimum-coverage policy in Michigan leaves drivers financially vulnerable in the event of vehicle damage. Your insurance won’t protect your car in an accident with a Michigan driver unless you have collision coverage in addition to the minimum coverage.

Here are Michigan’s state minimum-coverage requirements that all drivers must meet.

Coverage	Minimum Requirement	What It Covers
Personal injury protection (PIP)	Unlimited coverage (default) $500,000 per person per accident $250,000 per person per accident $50,000 per person per accident (for drivers with Medicaid) No medical PIP coverage (for drivers with Medicare)	Your medical expenses, including wage loss and replacement, following any accident, regardless of fault
Property protection insurance (PPI)	$1 million	Damages to other people’s property, including parked vehicles
Residual liability insurance	$250,000 per person and $500,000 per accident in bodily injury liability (default) or $50,000 per person and $100,000 per accident (minimum) $10,000 in out-of-state property damage liability	Someone else’s personal injury expenses (and out-of-state vehicle damage)

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What affects car insurance rates in Michigan?

Michigan limits insurance companies from using some kinds of information about you to set rates. The state bans insurance companies from considering factors like ZIP code, marital status, credit score, and gender. So, the factors that affect car insurance rates in Michigan relate to your car and driving history.

• Uninsured driver rates: Even in a no-fault state, insurance companies charge more when the rate of uninsured drivers is high. Though reform has reduced the number of uninsured drivers in recent years, Michigan still has a high proportion of uninsured drivers.^[8]

• Your car’s make, model, and year: Insurance companies evaluate the safety features and replacement cost of your car, among other factors, when setting rates. So if you’re about to buy a car and are choosing between different models, compare quotes for each and see if there’s a noticeable difference.

• Your deductible: Your insurance company will subtract your deductible from your insurance payout when you make a claim. Taking a higher deductible will lower your premiums.

• Your health coverage: If you have Medicare or Medicaid or meet other health coverage requirements, you may be able to opt out of PIP coverage, which could lower your rates substantially.

• Your driving history: Especially because Michigan car insurance companies can’t use demographic information to predict your likelihood of having an accident, any speeding ticket, DUI, or other violation on your driving record will spike your premiums.

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