Best Cheapest Car Insurance for High-Risk Drivers in the US
|Best Cheap Car Insurance for High-Risk Drivers in the US Right Now|
|Table of Content|
High-risk car insurance is a type of auto insurance that covers situations in which the insurer perceives there is a greater-than-average likelihood of a claim, or when the perceived amount that might be paid out in claims is higher than usual.
Frequent reasons for high-risk insurance include multiple accidents, infractions, and driving under the influence violations (DUIs). Other times, you can be considered high-risk due to your payment history, age, or the value, use, or features of your car. For example, rates will rise if you have modifications to your vehicle or will use the car for racing.
It’s best to call your insurance company to discuss your specific situation when you’ve been denied car insurance or high-risk car insurance is appropriate for another reason. Although many high-risk insurers can cover most of these circumstances, some will do it better than others.
What is a high-risk driver?
Not every “high-risk driver” has a bad driving record. The high-risk category includes a large swath of drivers, many of whom can’t get coverage from major insurers.
Many companies specialize in high-risk car insurance, but there’s no single definition all carriers use. High-risk drivers may include people who:
♦ Have tickets, at-fault accidents, or DUI convictions.
♦ Have allowed their coverage to lapse.
♦ Are newly licensed.
♦ Have poor credit.
♦ Own an exotic or high-powered vehicle.
High-risk auto insurance companies will typically cover drivers who need an SR-22 or an FR-44, which certify you have enough insurance after a violation. Insurers will file the form with your state’s department of motor vehicles if you need one.
Where to find affordable high-risk auto insurance
Although a few major insurance companies, such as Geico and Progressive, accept some high-risk drivers, others like Safe Auto and The General specialize in them. Depending on the risk factor in question, any of these companies could offer the lowest car insurance rates.
Certain agencies and brokers like Good2Go and Freeway Insurance also provide nonstandard insurance. Brokers charge an additional fee that they’re typically required to disclose. If you use one, ask if any additional fees are not included in your car insurance quote.
What Makes a High-Risk Driver
Some drivers can’t help but be assessed as high-risk by car insurance companies. Other times, their high-risk classification is because of them. That being said, there are instances of potentially good drivers being classified as high-risk. High-risk drivers are classified as the following:
♦ Teen drivers – With drivers becoming certified and licensed around the age of 16, new drivers are pretty young people. Without much of a driving record to go on, insurance companies will charge them higher premiums since young drivers tend to have higher accident rates than any other driver. Teen drivers pay the highest for car insurance, so they often start off on their parents’ policy. This is also the case for first-time drivers.
♦ Senior drivers – Car insurance rates tend to average out when the driver is aged 26 to 65. When you get older and reaction time to situations slow, your car insurance rates will reflect that. While older drivers are not high-risk in the traditional sense but still pay a little more than normal.
♦ Lapsed coverage – If there is one thing to avoid with car insurance, it’s having long periods of no coverage between policy renewals. This is referred to as “coverage lapses.” Car insurance providers will notice this. Driving without car insurance is illegal in several states and is an easy way to get in trouble with the law and pay more for coverage.
♦ Poor credit score – Similar to lapsed coverage, car insurance companies look at potential policyholders’ credit scores. Car insurance is all about making your monthly payments on time, and what better way to judge financial responsibility than a credit score that is based on the same exact thing. Not all states do this, but maintaining a good credit score is important in order to rent an apartment, for example.
♦ Traffic violations – Naturally, drivers with a series of violations on their driving record will be labeled as high-risk by car insurance companies. They specifically look for moving violations that happen while you are driving. Accidents result in damage which results in claims which are why insurance rates are increased.
♦ DUIs – The most significant violation that can more than affect your car insurance rates is a DUI. In addition to legal consequences, insurance rates are at least doubled for drivers with a DUI. They may also be required to carry what is known as SR-22 insurance with their state’s DMV and insurance company. These are the most high-risk drivers, according to them, and the SR-22 proves it.
♦ Road incidents – Hit-and-runs, several collisions, and road rage are instances that can have you classified as a high-risk driver if these behaviors are regular. This is why several car insurance companies have safe driving discounts to incentivize better habits on the road.
How much does high-risk car insurance cost?
High-risk drivers are likely to pay more than $565 per year, the average national cost for minimum coverage car insurance according to NerdWallet’s rate analysis. But auto insurance rates at every risk level vary widely depending on your age, driving history, location, and other factors, like the type of coverage you buy.
For instance, “full coverage” auto insurance can cost more than double what you’d pay for minimum coverage. Full coverage refers to a combination of different car insurance coverages, including higher liability limits, collision, and comprehensive insurance.
Below are the average annual rates for minimum coverage for drivers with bad credit, an at-fault accident or a DUI, as compared to drivers with good credit and clean driving history.
The Best Companies for High-Risk Drivers Based on Driving Record
The reasons an insurance company may consider you a high-risk driver can be varied. One of the most common reasons is if violations show up on your driving record. A history of tickets, at-fault accidents, DUIs or other infractions indicates to insurance companies that you pose a higher risk to them. The more severe your violation, or the more violations you commit, the higher your rates will be.
Using a scoring system based on a affordability of rates for high-risk drivers and customer service quality MoneyGeek identified two insurers as the best companies for high-risk drivers:
♦ State Farm ranks as best commonly available insurer for high-risk drivers, also scoring well in affordability, customer satisfaction and financial stability.
♦ USAA scores the best overall for high-risk drivers, but it's only available to military families. It offers affordable premiums and received high marks in both satisfaction and financial stability.
Finding the best car insurance for high-risk drivers can take extra time and research. If you're only focused on price, MoneyGeek has also detailed the cheapest companies for high-risk drivers.
The Cheapest Companies for High-Risk Drivers Based on Driving Record
If customer service and extra services rank far lower on your list of needs than affordability, you may be interested in knowing which car insurance companies offer the cheapest policies. The national average cost of insurance for drivers with no violations is currently $1,379, while those with violations on their records pay an average of $2,240.
In terms of the cheapest car insurance for high-risk drivers, USAA also comes out on top in this list, with an average cost of $1,389. State Farm is the runner-up at $1,769.
These figures are based on average rates for three different violation scenarios: after a ticket, an at-fault accident or a DUI.
The Cheapest Companies for High-Risk Drivers by State
While the previous section highlights national averages for high-risk driver insurance, it's important to remember that these figures can vary based on where you live. Some companies adjust their rates in different states. To ensure you find the best option for your needs, we highlight the cheapest company in each state.
Excluding USAA, State Farm is the cheapest option in 27 states. American Family Insurance — a regional insurer — is the cheapest option and second most frequently: in six states. But 12 companies were the cheapest option in at least one state, so high-risk drivers can benefit from shopping around.
USAA was excluded from this analysis because of its eligibility requirements, but if you're eligible we found it's the cheapest car insurance company for drivers in 29 states.
Top 10 The Best Companies for High-Risk Drivers in US
1. American Family Insurance
American Family Insurance doesn't have as wide a geographic footprint as some other major insurance companies, as it currently serves only 19 states. However, high-risk drivers residing in a state in which policies are available should consider American Family (they even offer policies through Costco). The company's rates usually increase by a relatively small margin after common driving infractions. The company's accident-forgiveness policy allows customers to avoid steep rate increases following their first at-fault accident. To be eligible for this coverage you must meet the following criteria:
- Maintain an accident-free record for five years
- Must have held an American Family policy for five years
- No major violations or infractions
2. The General
The General markets itself as a company that will provide auto insurance policies to everyone, including high-risk drivers. In fact, The General is a company that specializes in covering high-risk drivers. The company offers coverage in 46 states, so you will need to verify your state is one of them.
With The General, you can't bundle various insurance policies and save money. However, The General does provide some other great discounts, including:
- Good Student: To qualify, students must provide documentation they currently have at least a "B" average.
- Double Deductible: This discount doubles the deductible for comprehensive and collision coverage for the first 45 days of a policy—thus reducing your premium.
- Paid in Full: Customers who pay an entire year's premium instead of monthly installments.
- Previous Insurance: For those who swap to The General straight from another provider.
3. State Farm
State Farm is one of America's largest insurance companies. While State Farm is not often known as the cheapest option, high-risk drivers can expect relatively minor increases in their premiums after committing any of a number of different driving violations. The company also offers discounts that may lessen the impact of a poor driving record, including:
- Enrollment in the State Farm Drive Safe & SaveTM and Steer Clear® programs
- Driver training or defensive driving courses
- Vehicle safety discounts
- Bundling multiple policies
In many states, drivers with DUIs, major violations, or a history of uninsured driving need a specific proof of insurance document called an SR-22. However, not all insurance companies will insure high-risk drivers, and not all insurance companies even offer SR-22 documentation.
If your driving history requires that you file an SR-22 with the Department of Motor Vehicles, you can qualify for a Dairyland car insurance plan quickly through its website and get the required SR-22 documentation you need to get back on the road.
USAA is widely known as an affordable car insurance company, and this holds true for high-risk drivers. USAA's car insurance rates do not increase as dramatically as the rates of some of their competitors. However, USAA coverage is not available to everyone. Customers must be members of the military — or their immediate relatives — to purchase a policy. USAA offers accident forgiveness, which can keep your rates from spiking after an at-fault accident. Further discounts or ways for high-risk drivers to save on a USAA car insurance policy include:
- Enrollment in the SafePilot telematics program
- Mulitple policy bundle
- Installing an anti-theft device
6. Bristol West
Bristol West is a high-risk car insurance specialist that’s been insuring drivers since 1973. If you have poor credit, no credit, no prior insurance, or even a DUI, it’s worth knowing that the company positions itself to help drivers who have trouble finding insurance elsewhere. Bristol West is a subsidiary of Farmers Insurance, the seventh-largest car insurer in the U.S., and has an AM Best rating of A (Excellent).
Thanks to the range of high-risk situations the company can insure, a user-friendly website with online services, and comparably fewer complaints among high-risk insurers, we chose Bristol West as the best high-risk insurer overall.
Although it usually takes several driving violations or accidents to label you as "high-risk," many drivers experience rate increases after they are found at fault for just one auto accident or a couple of traffic tickets, which can make it hard for these drivers to maintain their car insurance. However, GEICO offers competitive rates even for drivers with speeding tickets or accidents on their record.
One of GEICO's strengths is the wide variety of discount options it offers. In fact, it offers discounts based on your car's safety features and discounts based on your driving habits and loyalty to the company. Additionally, GEICO partners with many corporations and associations to provide special discounts to members of those organizations.
Progressive, the third-largest car insurer in the U.S., has a great online quoting tool that shows you comparative rates from other insurers and lets you name your price. The online quote then provides helpful suggestions on the kind of coverage you can expect for the price you’ve cited. The company has been insuring cars since 1937, and is one of the nation’s largest car insurers, with a financial strength rating of A+ (Superior) from AM Best.
Progressive’s customer service satisfaction rankings fall below average in some regions while they are about average in others. Its complaints trends with state regulators were somewhat worse than average in both 2018 and 2019.
Progressive is a pioneer in telematics; it has a safe driver program called Snapshot that can lower your insurance cost based on data obtained with a tracking device monitoring your driving habits.
9. Direct Auto
Believe it or not, a low credit score can also impact your insurance premiums and, in some cases, your ability to obtain car insurance. However, Direct Auto promises to work alongside you by providing affordable car insurance while you work on improving your credit score.
Direct Auto may not have the same reputation as companies like GEICO or State Farm, but that doesn't make their discount options less enticing. In fact, Direct Auto offers around a dozen discounts that drivers can qualify for and save 25% or more.
The two most notable discounts through Direct Auto are their Military Discount—which offers 25% off to all active service members—and their Multi-Car Discount of 25% for covering two or more vehicles with Direct Auto. The company also offers discounts to seniors, safe drivers, those who switch to Direct Auto from other companies, homeowners, and more.
Hagerty is a specialist insurer for motor enthusiasts that can cover almost any specialty-car situation, whether you are involved in motorsports, have a high-value car, a collectible, a kit car, or a supercar. Policies by Hagerty are underwritten by one of three companies. The company provides coverage in all 50 states and has an outstanding track record with the NAIC, with complaints trending well below average in 2018, 2019, and 2020.13
Hagerty is our top pick for modified vehicles and track use because of its ability to ensure a range of specialty cars for motorsports that many other insurers will not. We also like the community the company builds with members through the Hagerty Drivers Club.
How to avoid high car insurance rates
Some factors that insurers view as risky, such as age, are outside your control. Others, like owning a fancy car, may not be things you want to change. In general, here are some ways to get out of the high-risk insurance category (and lower your rates) as soon as possible:
♦ Take steps to improve your credit. Drivers with poor credit and a clean driving record can pay almost as much for car insurance as a driver with a DUI, according to NerdWallet’s 2021 rate analysis.
♦ Drive safely. You can even take a driver safety course and earn discounts from some companies after completion.
♦ Shop for better insurance rates three years and five years after a traffic violation conviction.
♦ Don’t let your auto insurance lapse. Drivers with a gap in coverage are labeled high-risk, even if they don’t own a car. Non-owner car insurance can help you avoid being labeled as a high-risk driver.
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