Compare No-Down-Payment Car Insurance: Rates, Discounts, & Requirements [2024]

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. 

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. 

Read More: What cars have the lowest car insurance rates?

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. 

Car Insurance for Company Vehicles: Average Monthly Rates by Coverage Level & Provider

Insurance Company	Average Monthly Car Insurance Rate for Low Coverage	Average Monthly Car Insurance Rate for Medium Coverage	Average Monthly Car Insurance Rate for High Coverage
	$386	$408	$428
	$281	$295	$285
	$327	$347	$375
	$250	$268	$286
	$484	$505	$530
	$283	$287	$292
	$311	$335	$363
	$255	$272	$288
	$352	$372	$385
	$200	$212	$222

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. (For more information, read our “Compare Military Veteran Car Insurance Rates“).

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. 

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.