Buying No-Credit-Check Auto Insurance: What You Need To Know in 2023

If you’re searching for car insurance, you may be worried a poor credit score will raise your rates. Many insurance companies rely heavily on credit scores to determine the likelihood of a policyholder filing an insurance claim. So, finding the best car insurance for bad credit may take some time.

Some companies offer no credit check auto insurance, but these companies often don’t provide full coverage. Additionally, their auto insurance premiums aren’t as cheap as most other companies.

You may be able to find bad credit car insurance at an affordable rate. However, the best way to find no credit check car insurance that fits your budget is to shop online and compare quotes from several companies in your area.

Which insurance companies offer auto insurance with no credit check?

While it’s not difficult to find auto insurance with bad credit, finding an insurance company that won’t consider credit score when setting insurance rates can be tricky and time-consuming.

Your credit score is less likely to impact your auto rates with the following companies:

• Progressive
• Allstate
• Dillo
• CURE
• Empower Insurance Services
• USAA

Even the companies listed above may consider your credit score when determining your insurance rates. So find a non-standard insurer that doesn’t allow your credit score to impact your premiums significantly.

In California, Hawaii, Michigan, Massachusetts, and Washington, state law dictates that insurance providers can’t consider your credit score when determining your rates. However, in other states, you may need to consider several options to find a company that offers you affordable coverage.

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What are the best car insurance companies for bad credit?

Some of the most popular non-standard car insurance companies offering coverage to individuals with bad credit in the U.S. include:

• Direct
• Kemper
• GAINSCO
• Dairyland
• The General
• Infinity
• National General
• Hallmark
• Foremost
• Founders Insurance
• Titan
• Bristol West

Most non-standard auto insurers will cover individuals who can’t find coverage with more well-known institutions, like Allstate and Farmers. So if you have bad credit, reach out to a few non-standard insurance companies to see how much you would pay for coverage.

The only way to know which company will offer you the best deal based on your credit score is to compare quotes from multiple providers. Comparing quotes will help you discover which companies will offer the coverage you need at a price you can afford.

Why does my credit score affect my insurance rates?

Individuals with low credit scores are statistically more likely to file a car insurance claim. While this correlation may not make much sense, it helps insurance companies predict which policyholders are more likely to file a claim and cost the company money.

The reverse of this statistic is also true, which is why most insurance companies reward good credit scores with lower insurance rates. So, the higher your credit score is, the less you’ll pay for coverage.

Since insurance companies view policyholders with low credit or no credit as higher risk, you’ll want to consider how you can find the cheapest insurance in your area with poor credit. 

How can I find the cheapest car insurance with bad credit?

Car insurance rates vary for many reasons. Insurance providers take different factors into account when determining rates, such as:

• Age
• Gender
• Marital status
• Driving history
• Credit score
• ZIP code
• Coverage type
• Make and model of vehicle

Since companies calculate insurance rates differently, you won’t know which one offers the best rates until you compare quotes from several in your area.

The table below shows a comparison of monthly auto insurance rates with different well-known companies based on good, fair, and bad credit scores.

 

Some companies charge nearly $400 more monthly to people with bad credit scores. With this in mind, people with poor credit scores should search for companies that won’t offer similar rates.

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Does non-standard car insurance cost less?

Non-standard auto insurance, or high-risk auto insurance, often comes with higher rates for coverage because policyholders pose a higher risk of filing a claim. However, since non-standard car insurance companies typically only offer liability coverage, you could pay less for coverage than you did if you previously had a full coverage policy.

One of the best ways to save money on insurance is to choose a lower coverage level. You may be used to paying for a full coverage policy, but full coverage can cost more than two times what a liability-only policy costs.

The table below shows average auto insurance rates in each state based on a person’s coverage level.

While you can expect to pay higher than your state’s average for liability coverage if you’re considered a high-risk driver because of your credit score, you may pay less than you would for a standard full coverage policy.

No Credit Check Car Insurance: The Bottom Line

Most companies will charge you more for coverage if you have bad credit or you don’t have credit at all. To avoid paying more for insurance because of your credit score, you may want to consider a non-standard insurance company.

Non-standard insurers offer car insurance to individuals considered high risk, including people with poor credit. However, expect to pay higher rates for liability coverage without the option to purchase a full coverage policy.

If you’re looking for affordable car insurance with no credit check, your best bet is to shop online and compare car insurance quotes with multiple providers to ensure you don’t overpay for coverage.

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