Last updated: February 27, 2023Best Auto Insurance With No Down Payment
A car insurance company will require a deposit when you sign up for the plan, but these companies will let you get started with the least amount of money.
State Farm is our top pick for auto insurance without a down payment. It combines excellent coverage, great customer service, and some of the lowest rates in the industry.
If you’re looking to save on your insurance, look no further than Allstate. The company has more than a dozen ways for customers to save.
You’ve probably heard of no-down-payment auto loans, which allow you to walk away with your new (or new to you) vehicle without paying a dime. But which companies offer no down payment, allowing you to afford insurance with no deposit?
First of all, the concept of auto insurance without a down payment is a bit misleading. No matter what insurance company you choose, you’ll be required to pay at least some money to cover your first month of coverage when you sign up. However, many companies allow you to minimize the money down by paying monthly rather than in an annual or biannual sum. For less money upfront and low car insurance premiums, get car insurance quotes from the following companies on our list.
Comparison of the Best Auto Insurance with No Down Payment
| Factor | State Farm | Allstate | Direct Auto | Acceptance | National General |
|---|---|---|---|---|---|
| Ranking | 1st | 2nd | 3rd | 4th | 5th |
| What it’s best for | Overall | Discounts | Military members | High-risk drivers | Low-mileage drivers |
| Payment options | Monthly | Monthly or paid-in-full | Monthly or paid-in-full | Not disclosed | Monthly or paid-in-full |
| Paid-in-full discount | No | Yes | Yes | No | Yes |
| Average annual premiums | $1,419 | $1,673 | $1,776 | $1,732 | $2,173 |
Summary of the Best Auto Insurance With No Down Payment
- 1.
Best No Down Payment Insurance Overall: State Farm
- 2.
Best No Down Payment Insurance for Discounts: Allstate
- 3.
Best No Down Payment Insurance for Military Members: Direct Auto
- 4.
Best No Down Payment Insurance for High-Risk Drivers: Acceptance Insurance
- 5.
Best No Down Payment Insurance for Low-Mileage Drivers: National General
Detailed List of the Best Auto Insurance With No Down Payment
What We Like Most:
- Local agents
- Rideshare insurance available
- Discounts for having multiple cars
Founded in 1922, State Farm is one of the largest and most popular auto insurance companies. In fact, it’s the top writer of auto insurance in the U.S.1 That’s thanks to its affordable annual premiums, variety of discounts, and user-friendly digital tools.
Who It's Best For- Customers with other State Farm policies
- Drivers who want robust digital tools
- Customers with clean driving records
- Anyone looking for accident forgiveness
Who It's Not Best For
Customers who want a paid-in-full discount- Drivers with multiple at-fault accidents
- People in Massachusetts or Rhode Island (where coverage isn’t available)
Great Insurance Rates
State Farm is known for having some of the lowest insurance rates in the industry. The company’s average premium is over $200 lower than the next closest competitor on our list. Not only does State Farm offer excellent rates, but the company has plenty of discounts that allow you to save even more. Discounts are available for safe drivers, vehicles with safety features, bundled policies, and more.
Flexible Payment Options
Unlike many auto insurers, State Farm’s default payment method is individual monthly car insurance payments, making it a great option for those who want a low upfront bill. On top of that, the company allows you to choose your own payment due date. Finally, State Farm simplifies the payment process for customers with multiple policies. Rather than paying multiple bills throughout the month, you can pay a single bill for all of your State Farm policies.
Robust Digital Tools
State Farm has one of the most user-friendly websites and apps of any company on our list. This is great for tech-savvy customers who prefer handling their insurance needs online rather than speaking with an agent. Additionally, the company has a digital device, known as the Drive Safe & Save device, which you can install in your vehicle to save money when you maintain safe driving habits.
LEARN MORE:
You can utilize many great tools when you work with State Farm. Get more details by reading our State Farm review.
What We Like Most:
- Low rates for teen drivers
- A+ rating from AM Best means financial stability
- Great customer service
Allstate was founded in 1931 and has since become one of the largest auto insurers in the country. The company is known for its great auto insurance coverage, but it also offers a variety of other financial products including life insurance, business insurance, and identity theft protection.
Who It's Best For- Customers who want discounts for bundled policies, safe driving, car safety devices, and more
- Families who want teen driver discounts
- Customers who want specialty coverages, such as coverage for classic cars or for travel to Mexico
Who It's Not Best For- People who want the best customer service (as Allstate has a below-average J.D. Power customer satisfaction rating)2
- Customers with multiple cars to insure (as Allstate does not have a multi-car discount)
Perks for Teen Drivers
If your family has a teen driver, Allstate could be the right insurance company for you. Not only will the company offer coverage for your teen driver — it’ll also give you a discount.
First, Allstate advertises policies for teen drivers specifically, so it’s easy for parents to add their children to their policies when they start driving. On top of that, the company offers several discounts.
- TeenSMART discount: TeenSMART is a training program that can reduce your teen’s risk of at-fault accidents.
- Smart Student discount: Allstate’s Smart Student discount allows you to save on your car insurance if your teen has a GPA of 2.7 or higher.
- Student away-from-home discount: Once your teen goes off to college, you can save even more, since the company offers a discount when your teen attends a school at least 100 miles from where they garage their car.
Excellent Savings Opportunities
As we’ve mentioned, Allstate offers a FullPay discount that allows you to save when you pay your full policy premium at once. Allstate also offers discounts for the following:
- Anti-lock brakes
- Anti-theft device to prevent auto theft
- Automatic payments
- Bundling with home or renters insurance
- New car
- On-time payments
- Paperless billing
- Safe driving
- Signing your policy at least one week before it becomes effective
Unique Coverage Options
Allstate has a variety of coverage options. It offers the standard coverages you would expect of any insurance company, such as liability, collision and comprehensive insurance, and uninsured motorist coverage. On top of that, it offers unique coverage you won’t find with many other companies. Those coverages include classic car insurance and car insurance for travel to Mexico.
DID YOU KNOW?
Allstate customers have dedicated agents who serve their needs. See if Allstate is right for you by reading our Allstate review.
What We Like Most:
- Low rates for high-risk drivers
- Can pay in cash locally
- Save money by bundling with life insurance
Direct Auto is one of the newer (and smaller) insurance companies on our list. It was founded in 1991 and serves fewer than half of all states:
- Alabama
- Arkansas
- Delaware
- Florida
- Georgia
- Louisiana
- Michigan
- Mississippi
- North Carolina
- Ohio
- Pennsylvania
- South Carolina
- Tennessee
- Texas
- Virginia
- Washington
Who It's Best For- High-risk drivers, including those with SR-22s
- People who want to customize their insurance plans
- Military members (as Direct Auto offers a military discount)
Who It's Not Best For- Drivers in most states (as coverage is only available in 16 states)
- Customers who also need homeowners insurance
- Rideshare drivers (as Direct Auto doesn’t offer rideshare coverage)
- Customers who want the lowest rates
Coverage for High-Risk Drivers
Direct Auto doesn’t just offer insurance to high-risk drivers — covering them is one of the core missions of the company. It promises to provide the insurance coverage you need regardless of your driving history. Direct Auto works with its customers to build affordable policies as well as to use discounts to lower premiums as much as possible.
Many Opportunities to Save
Direct Auto has an impressive list of available discounts. First, discounts are available for safe drivers, good students, and senior citizens. You can also reduce your premiums by joining the DynamicDrive program or taking a driver education course.
There are vehicle discounts available for having multiple vehicles on your policy or owning a vehicle with certain safety features. Finally, there are discounts available for having multiple policies with Direct Auto, being a homeowner, switching from another insurer, setting up automatic payments, paying in full, or agreeing to paperless billing.
Discount for Military Members
Direct Auto is the only insurance company on our list that offers a discount for military members. Active service members can save an impressive 25 percent on their premiums as long as they provide a copy of their orders or other documentation providing their service status.
GO DEEPER:
Read more about how Direct Auto can serve you with our Direct Auto review.
What We Like Most:
- Accepts high-risk drivers
- Bundle with renters', homeowners', or pet insurance
- Good for those with bad credit
Acceptance is a relatively small provider that was founded in Texas in 1969 with the belief that all drivers deserve car insurance coverage, even those with imperfect records. Today, the company serves nearly 200,000 people across 15 states:
- Alabama
- Arizona
- California
- Florida
- Georgia
- Illinois
- Indiana
- Mississippi
- Missouri
- Ohio
- Pennsylvania
- South Carolina
- Tennessee
- Texas
- Virginia
Who It's Best For- High-risk and bad-credit drivers
- Drivers who have a hard time finding coverage elsewhere
Who It's Not Best For- Drivers in most states (coverage is only available in 15 states)
- People who want an insurer with excellent financial strength
- Those with clean driving histories
Coverage for High-Risk Drivers
If you’re a high-risk driver, such as one with a spotty driving history or a poor credit score, then you probably know how difficult it can be to find car insurance. Some providers charge high-risk drivers considerably higher rates, while others deny high-risk drivers coverage altogether. Not only does Acceptance offer insurance to high-risk drivers, but it also markets its services to them specifically.
Reimbursement for Tickets
One of Acceptance’s most unique perks is its TicketProof program. While this program requires an additional fee, it will reimburse you for traffic tickets. You’ll get up to $100 for tickets reimbursed up to twice per year. Furthermore, you’ll get a $200 reimbursement for legal fees if you need to go to court for your ticket, as well as a $250 reimbursement if you are required to attend traffic school.
SR-22 Coverage
An SR-22 certificate is often required by states for certain driving violations, including DUIs, traffic violations, and suspended driver’s licenses. Drivers required to obtain SR-22s typically have a more difficult time finding coverage. However, Acceptance offers policies to SR-22 drivers specifically to ensure they have access to coverage.
What We Like Most:
- Personal and commercial policies available
- Lower rates for good drivers with DynamicDrive app
- Report claims, and get reimbursed, within 48 hours
National General may not be one of the most popular auto insurance companies, but it is one of the oldest ones on the market. Formerly known as GMAC Insurance Group, it was founded in North Carolina in 1920. The company offers unique discounts and flexible payment options.
Who It's Best For- Low-mileage drivers
- Customers who own RVs
- Customers who want many discounts
Who It's Not Best For- Customers who want the lowest rates
- People who want the best customer service
- Drivers who want a provider with robust digital tools
- Customers who want a variety of coverage options
Unique Bundling Options
Like most other insurers, National General offers a discount when you bundle your policies. However, this company’s options are particularly unique, especially for RV owners. First, the company offers a discount when you have both an RV and another vehicle insured. Even better, you’ll pay only one deductible if both vehicles are damaged within the same covered accident.
Perks for Low-Mileage Drivers
If you drive a low number of miles, consider National General, which offers a discount for low-mileage drivers. This perk may be especially attractive if you’re a remote worker whose car sits unused often, or if your family has multiple vehicles and you don’t use all of them on a daily basis.
Flexible Payment Options
If you want flexibility in your insurance payments, National General might be right for you. As with the other companies on our list, National General allows customers to pay their premiums monthly, meaning you can put down the least amount of money and have the lowest payments.
Methodology
When putting together our list of the best auto insurance with no down payment, our goal was to find providers that met two key criteria. First, we wanted those that offer excellent coverage at affordable rates. Next, we wanted to include those companies with flexible payment options for people who want to pay the lowest amount upfront when they sign up for their policies. Here’s more about the features we considered:
- Coverage options: There are many different auto insurance coverage options available, including standard coverages like liability and collision insurance as well as specialty options like rideshare coverage. When we chose companies for this list, we made sure to have a variety of coverage options so each customer could choose the one that was best for them.
- Payment flexibility: Many customers are looking for flexible payment options, especially when it comes to paying as little as possible upfront by only covering the first month’s premium rather than the entire policy premium.
When using these characteristics to choose the best no-down-payment car insurance companies, we took a three-pronged approach that included analyzing company information and data from third-party sites, using our own proprietary data, and implementing our institutional knowledge gained from more than two decades in the auto insurance industry.
Frequently Asked Questions
What is a car insurance down payment?
Usually, a car insurance down payment is just your first month’s premium (or more, if you decide to pay upfront). Insurers may require a larger amount down for customers without good credit.
Is car insurance cheaper if you pay upfront?
Whether or not car insurance is cheaper when you pay upfront depends on your insurance company. Many insurers, including Allstate, Direct Auto, and National General, offer discounts when you pay your full premium upfront rather than in individual monthly payments.
Why do car insurance companies require down payments?
Car insurance companies require down payments as a way of reducing their own risk. If companies offered car insurance without requiring you to pay anything upfront, they would run the risk of having to pay out a claim without you ever paying any premiums.
Can I pay half my car insurance upfront?
In many cases, companies allow two payment options for car insurance: one upfront payment or individual monthly payments. You may be able to pay half of your premium upfront instead of the entire amount, but you may not be eligible for a discount.
Citations
Facts + Statistics: Insurance company rankings. Insurance Information Institute. (2021).
https://www.iii.org/fact-statistic/facts-statistics-insurance-company-rankingsAuto Insurance Claim Satisfaction Rises on Combination of Soaring Vehicle Values and Growth of Straight-Through-Processing Claims Management, J.D. Power Finds. J.D. Power. (2021, Oct 28).
https://www.jdpower.com/business/press-releases/2021-us-auto-claims-satisfaction-study