Compare No-Down-Payment Car Insurance: Rates, Discounts, & Requirements [2023]
Cheap, no down payment car insurance is when a company allows you to pay for coverage month by month instead of in a lump sum.
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Joel Ohman
Founder & CFP®
Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...
Founder & CFP®
UPDATED: Dec 21, 2022
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance company and cannot guarantee quotes from any single company.
Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Dec 21, 2022
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance company and cannot guarantee quotes from any single company.
Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- No down payment car insurance simply means you pay for just the first month of coverage rather than paying a lump sum for six or more months
- Finding a car insurance company with cheap rates will ensure your initial payment to activate coverage is as low as possible
- Paying in a lump sum for six or more months of coverage is often cheaper than no down payment over time due to payment in full discounts
Technically, there isn’t such a thing as zero-down car insurance, as car insurance companies won’t insure you without first receiving a financial payment. However, not all car insurance companies will require you to prepay for months of coverage, which means you can get a low down payment auto insurance policy. Essentially, you only have to pay for the first month to activate your insurance, and if you find cheap car insurance at a company, this first payment can be very low.
Continue reading to learn about cheap car insurance with no down payment. We will go over everything you need to know about finding low-down payment car insurance at car insurance companies.
No Down Payment Car Insurance Explained
As we’ve stated, you have to pay for auto insurance coverage to keep your policy active, which means that, technically, there is no such thing as cheap insurance with no down payment. However, not all auto insurance companies will require you to prepay for months of coverage. Instead, you can pay month by month for car insurance coverage, which means you only have to pay for the first month of coverage.
Paying for only the first month of car insurance coverage is no down payment car insurance, making it an affordable option for those who can only pay month by month.
However, the difference between paying in a lump sum for more than a few months of coverage and month-by-month is that it is generally cheaper to pay in a lump sum. Car insurance companies often offer car insurance discounts for customers who pay in a lump sum for six months or more of coverage, making it cheaper over time than no down car insurance payments.
The discount saved by prepaying for coverage will vary depending on what auto insurance company you pick. However, most car insurance companies will offer at least a small discount for prepaying in a lump sum. If the payment in full discount isn’t enough of an incentive and you can’t afford a lump sum, though, it is perfectly fine to pay month by month. Finding a cheap auto insurance provider will help make the monthly rates more affordable.
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Who Can Buy No Down Payment Insurance
Every car insurance company should offer drivers multiple car insurance payment methods, whether paying for six months or one month, automatic withdrawal, or manual payments. However, some companies may require a higher down payment for higher-risk drivers to offset the risk of insuring these high-risk drivers. Some examples of high-risk drivers include the following:
- Drivers who need specialized high-risk auto insurance.
- Drivers with expensive cars, such as specialty sports cars.
- Drivers with poor credit scores.
If your car or you are a high risk to insure, car insurance companies may require more than one month of payment. Otherwise, if you get into an accident within the first month of being insured, auto insurance companies will face a significant financial loss when paying your claim.
States With No Money Down Car Insurance
Whether your state offers no down payment car insurance depends on your local insurance laws and your local car insurance company options. You will have to shop around and check with car insurance companies to see if you can get no down payment car insurance.
How to Find Cheap Car Insurance and Lower Your Rates
There are plenty of ways to find cheap down payment car insurance. You can shop around and compare auto insurance companies’ rates. In addition, follow the tips we listed below to try and lower your auto insurance rates.
- Apply for discounts. There may be discounts you haven’t yet applied for, such as safe driving discounts or good student discounts, that can help reduce your auto insurance rates.
- Choose a car wisely. If you pick a car that is cheaper to insure, you can get lower rates. Look for mass-manufactured cars with good safety ratings, and get insurance quotes for these cars before buying.
- Choose only necessary coverages. Consider getting rid of extras like roadside assistance or rental car reimbursement insurance. If you have an old car that is depreciated in value, you can drop collision insurance and comprehensive insurance.
- File only necessary claims. If you file many claims, you will see your rates increase. If the claim payout is only slightly more than your deductible, it may not be worth filing a claim, and it would be better to pay out of pocket.
- Raise your deductibles. You can raise one or more car insurance deductibles to reduce your auto insurance rates. As always, we caution you not to raise the deductible beyond an amount you can’t pay out of pocket.
Also, remember that insurance companies look at multiple factors when calculating rates, such as your driving record. So keeping a clean driving record will help reduce your auto insurance rates significantly. And if your state allows car insurance companies to use credit scores to calculate rates, improving your credit score will also lower your auto insurance rates at your next auto-renewal.
Affordable Car Insurance Companies
To give you an idea of which car insurance companies are the most affordable for drivers, we put together a list of average rates from major car insurance companies. Look at some of the cheapest car insurance companies’ average rates below.
Companies Average Monthly Car Insurance Rate for Low Coverage Average Monthly Car Insurance Rate for Medium Coverage Average Monthly Car Insurance Rate for High Coverage
Allstate $385.67 $408.07 $428.25
American Family $280.71 $295.36 $284.70
Farmers $326.87 $347.19 $374.51
Geico $250.16 $267.83 $285.76
Liberty Mutual $483.81 $504.88 $529.67
Nationwide $282.90 $287.48 $292.11
Progressive $311.43 $334.87 $362.58
State Farm $254.62 $272.48 $287.90
Travelers $351.97 $371.84 $384.92
Car insurance companies like USAA, Geico, and State Farm have some of the cheapest average rates for most drivers. However, USAA car insurance is limited to only military members and veterans, so drivers who don’t qualify for USAA will have to choose from the next best options.
The businesses we listed are all car insurance companies that sell across the U.S. This means that no matter where you move to, you can keep your chosen car insurance company as your insurer. However, small, local companies selling only in a few states may offer a cheaper rate. This is why we advise getting quotes from auto insurance companies in your area, as a less-known company may offer a cheaper rate than a big-name company.
Of course, for whatever car insurance company you choose, make sure first to check its customer service ratings and financial ratings. Customer service ratings will tell you how well the company handles claims and communicates with customers. Financial ratings will tell you if a company is financially stable enough to pay out multiple claims without going bankrupt.
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The Final Word: Car Insurance With No Down Payment
Many companies offer car insurance with no down payment, which means you only have to pay for the first month of coverage to activate your auto insurance policy. However, remember that several auto insurance companies will offer a discount to drivers who prepay for a few months of coverage, which makes paying a down payment sometimes cheaper than buying cheap auto insurance with no down payment.
Whether a company offers no down payment, shopping around is the best way to save on car insurance payments. If you want to start saving on car insurance today, use our free quote comparison tool. It will help you find and compare rates to see which car insurance company offers you the cheapest rates in your area.
Frequently Asked Questions
Does Geico have no down payment insurance?
Yes, Geico will usually offer a lower initial payment that amounts to a sum that covers just one month of coverage. However, Geico won’t insure you without some type of payment, the same as all auto insurance companies. If a company offers no down payment insurance, you won’t have to pay for multiple months in one lump sum to activate your policy.
Can I get zero down car insurance?
You can’t get car insurance without paying anything. However, many auto insurance companies will allow you to pay for just the first month to get car insurance, which means your initial rate payment could be very low. The best way to get a low rate is to shop with different auto insurance companies for quotes.
Are insurance down payments the same as deposits?
Yes, insurance down payments may sometimes be referred to as deposits. Either way, these terms usually refer to a usually nonrefundable payment to activate your insurance coverage. If you prepay for six months of coverage, however, you may get a refund if you cancel before the six months end.
Are no down payment car insurance companies scams?
If a company advertises car insurance you can get without making an initial payment, it is very likely a scam. However, if the company is referring to no down payment to mean you only have to pay for the first month of coverage, it is likely not a scam. If you aren’t sure, make sure to read customer reviews and financial ratings to determine a company’s legitimacy.
Which companies have the cheapest car insurance?
On average, some of the cheapest companies are USAA, Geico, and State Farm. However, the cheapest company depends on your driving record, vehicle, age, location, and more. So you’ll have to shop around to see which offers the cheapest car insurance rates in your area.
Free Car Insurance Comparison
Enter your ZIP code below to view companies that have cheap car insurance rates.
Secured with SHA-256 Encryption
Joel Ohman
Founder & CFP®
Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...
Founder & CFP®
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.