How to Get Affordable Car Insurance as a College Student With No Credit

• Drivers with low credit can see their auto insurance rates increase by as much as 80 percent. Some auto insurance providers view no credit the same as low credit.
• Young drivers have some of the highest auto insurance rates in the country. They can keep their rates low by taking advantage of student and driver education discounts.
• On average, USAA and GEICO offer the lowest rates for college students.

Auto insurance providers view people with low credit scores as higher-risk. This is because studies have shown that the lower someone’s credit score is, the more likely they are to file insurance claims.¹ To account for this risk, auto insurance providers charge higher premiums for drivers with low credit.

What if I Don’t Have a Credit Score?

You can still find auto insurance if you don’t have a credit score. However, some auto insurance providers view the lack of a credit score the same as a low credit score, so your rates could be significantly higher. Drivers with low credit may see their auto insurance rates rise by up to 80 percent.

It’s especially important for drivers without a credit score to shop around and compare quotes to find the lowest rates. One exception is for drivers in California, Hawaii, Maryland, Massachusetts. Laws in these states prohibit insurers from considering your credit score, or lack of a credit score, when determining your rates.

Our Top Picks:

• USAA has the lowest average rates for young drivers at $171 monthly, but is only available to military members, veterans, and their families. You could qualify if a parent or grandparent is a member, or if you’re a pre-commissioned officer, including ROTC.
• GEICO is next-cheapest — its easy online quote process and strong digital tools make it a good choice for many college students.
• State Farm and Progressive’s rates fall right around the national average, so it’s worth getting a quote to see how much you’ll pay.
• Allstate offers multiple pathways to qualify for a good-student discount and has the lowest GPA requirement, making it another worthwhile option.

College students with no credit generally pay $200 to $300 monthly for full coverage auto insurance, but rates vary significantly by personal circumstances. For example, if the car you drive is fully paid off and its value is low, it might make sense to opt for minimum coverage, which usually costs $100 monthly or less. If you do purchase liability-only coverage, it’s wise to increase your liability limits above the required minimum — generally to at least 100/300/50.

In addition to lacking credit, college students tend to be younger and have fewer years of experience behind the wheel, which drives up insurance costs. Car insurance costs are highest for teens and go down with age, leveling out around age 25.

Average Cost of Auto Insurance by Age

Some auto insurance providers consider no credit score the same as a low credit score. A poor credit rating can increase your auto insurance premiums by up to 80 percent.

The national average cost of auto insurance for drivers with low credit is $3,377 annually, or $281 per month. The table below shows the top 15 auto insurance providers for drivers with low credit.

College students with no credit can be one of the most expensive demographics to insure. Fortunately, there are steps you can take to lower your rates: 

• Stay on your parents’ policy, if possible. Staying on your parents’ auto insurance policy is almost always significantly cheaper than buying your own. On average, having an 18-year-old driver on a family policy increases annual premiums by $745. In comparison, a stand-alone policy for an 18-year-old driver typically costs $4,412. 
• Look into good-student discounts. Many providers offer discounts to full-time students who maintain a 3.0 GPA or higher.
• Take a driver education course. Completing an additional driver education course can earn you discounts from certain providers. 
• Leave the car at home. If you live on campus and only drive when you’re home on break, you can usually get a discount.
• Maintain a clean record. Practicing safe driving habits and keeping your record clean are some of the most effective ways to keep your rates low. After a certain number of years, you also may qualify for an additional, accident-free discount. 
• Sign up for a telematics program. If you have safe habits behind the wheel, you can save by signing up for a telematics program like Progressive Snapshot or USAA Safepilot. These programs track your driving and offer a discount for safe driving.
• Compare multiple policies. Compare quotes from at least three companies to find the cheapest rates. 

In some cases, you may be able to stay on your parents’ auto insurance policy. This is almost always cheaper than purchasing a stand-alone policy.

When You Can Stay on Your Parents’ Insurance

• You’re not driving while you’re at school
• You’re attending college in the same city where your parents live
• You’re living at home

When You Can’t Stay on Your Parents’ Insurance

• If you’re living away from home and driving a vehicle while away at school, you’ll need to purchase your own policy.

Given that insurance costs can sometimes be higher without a credit history, it may be tempting to build up your credit score before you purchase auto insurance.

However, if you’re operating a vehicle, you must purchase at least the minimum legal coverage. Driving without insurance has significant legal consequences, ranging from a fine to imprisonment. Build up your credit score while you’re insured to help lower your rates in the future.

In addition to your age and credit score, these factors can affect the cost of your auto insurance: 

• Location: Your state and city affect your insurance rates. Drivers in urban areas tend to pay more. 
• Driving history: Drivers with a DUI, at-fault accident or speeding ticket can expect higher premiums than those with a clean driving record. 
• Vehicle: Those who drive luxury vehicles can expect higher premiums. Likewise, those who lease their cars typically pay more and are required to purchase higher coverage. 
• Coverage level: Minimum coverage typically costs significantly less than full coverage: $53 monthly, compared with $200 monthly, on average. Before you opt for lower coverage, however, make sure you can cover the higher out-of-pocket expenses in the event of an accident.

Being a college student with no credit history can make car insurance more expensive, but it doesn’t have to break your budget. You can lower your costs by staying on a parent’s policy, qualifying for student discounts, taking a driver education course, and comparing quotes from companies that work well with first-time drivers. Even without a credit score, you have options—shop smart, stay safe, and build a clean driving record to get better rates over time.