Car insurance is a legal requirement for drivers in the UK, so it’s a cost that all vehicle owners need to keep in mind as part of their overall motoring budget.

If money’s tight but you need a vehicle to get around, owning a car that’s cheap to insure helps drivers keep a grip on their finances. Here’s a look at what affects the price of the car cover and the features that help keep premiums as low as possible.

Below are our top recommendations for cheap car insurance based on average rate estimates. The following providers stand out from the competition as the best cheap car insurance providers not only for the discounts they offer but also for their customer service and strong industry reputations.

Cheap Car Insurance CompanyCost RatingAverage Annual Cost*Affordable for…
1. USAA10.0$1,013Military families
2. Erie Insurance9.9$1,113Basic coverage
3. State Farm9.0$1,339Students
4. Geico9.4$1,352Most drivers
5. Progressive9.3$1,397High-risk drivers

Factors that can affect your auto insurance rates

Insurance companies look at many things when deciding what you should pay for a policy. Here are the main factors:

FactorHow It Affects Your Car Insurance Premium
AgeGenerally, people have fewer accidents as they age and gain driving experience (up to a point). Teen drivers pay the most, followed by drivers under 25.
Marital statusMarried people tend to have fewer accidents, so they pay less for car insurance.
Car make and modelCars that cost more to repair also cost more to insure. This applies to collision and comprehensive insurance, which covers your car. Safety equipment such as seatbelts and airbags can affect the price as well.
Annual mileagePeople who commute long distances and put many miles on their cars pay higher insurance prices.
Driving recordA clean driving record can reward you with discounts, while a poor one will make your insurance premiums rise. Having a DUI will make your rates jump, and you’ll be deemed “high risk.” While a single accident in your driving history raises rates, having multiple at-fault accidents lands you in the high-risk category too. Minor traffic violations like speeding tickets increase rates, but to a lesser degree.
Credit historyMost states allow car insurance companies to consider your credit history when determining prices. Poor credit will make your rates go up, and vice versa.
ZipcodeUrban areas have higher rates of theft, accidents, and vandalism, so drivers in cities pay the highest rates. Parking in a garage can sometimes lower your rate.
State requirementsStates range from requiring almost nothing to requiring many types of insurance. You’ll pay more for coverage as more types are required.
Desired coverageCar insurance rates rise as you add more types of coverage or choose higher coverage limits. Drivers only looking for their state’s minimum coverage, like basic liability coverage, will generally have the cheapest car insurance rates.
DeductibleA high deductible will lower the overall cost of the policy, and vice versa.

Average car insurance costs

According to our cost estimate data, the average 35-year-old driver with good credit and good driving history pay about $1,712 per year on average for car insurance in 2021. However, some states have cheaper car insurance than others.

Below are the top five most expensive states for full coverage car insurance.

Most Expensive Car Insurance StatesAverage Cost of Car Insurance
Michigan$4,430
New York$4,048
Louisiana$3,867
Florida$2,927
Nevada$2,354

And here are the five least expensive states for full coverage car insurance.

Top 5 Cheapest States for Car InsuranceAverage Annual Cost of Car Insurance
Ohio$939
Wisconsin$970
Maine$1,013
Vermont$1,029
Indiana$1,106

Cheapest car insurance for drivers with a recent accident

Not everyone has the ideal driving history and situation to get the cheapest rates. Below, you can see some popular providers’ average full coverage car insurance rates for drivers with a recent accident.

10 cheapest cars to insure for first-time drivers in the UK

First-time drivers aged 17- to 19 years old tend to pay 51% more to insure the same vehicle compared to their 20-year-old counterparts, recent data from MoneySuperMarket has revealed.

The financial comparison website’s latest Young Drivers Index also shows that the average cost of a full comprehensive policy for motorists in the 17 to 19 age group stands at £935, which is significantly higher than the £364 average for those aged 20 and above.

To come up with the figures, the firm analyzed more than one million quotes requested by its clients between June 2020 and June 2021. The company also used the data to identify the most popular cars among first-time drivers and the typical cost of insuring these vehicles.

The Ford Fiesta tops the list of most popular cars among young motorists based on insurance searches, according to the index obtained by financial advice and information website This Is Money. But with fully comprehensive coverage for 17- to 19-year-olds costing an average of £711, the model is not the cheapest to insure for the age bracket.

None of the top three favorites actually made the list of cars with the lowest premiums. The Vauxhall Corsa and Volkswagen Polo, which placed second and third in the most popular rankings, cost £689 and £656 to insure for first-time drivers.