The best car insurance options for individuals with poor credit in 2024.

In most states, car insurance companies use a credit score to set monthly premiums.

On average, drivers with bad credit pay 118% more for full coverage than those with excellent credit, according to data from Bankrate.

We have identified the top five auto insurers based on their rates for drivers with lower credit scores, as well as coverage options, availability, customer service, and other factors. Our methodology explains how we made these selections.

Best for affordability: Geico

For drivers with bad credit, Geico offers the cheapest average rates among the companies we reviewed.

Geico offers discounts of up to 22% for safe driving, 25% for multiple vehicles, and reductions for federal employees and military members.

Best for discounts: Amica

Is Amica a good option for auto insurance customers looking to cut costs due to its 18 discounts?

Amica offers a discount of up to 30% for bundling life, home, or renters insurance. Additionally, homeowners and car owners with collision alerts, electronic stability controls, or other safety features can receive a break.

Best for drivers with tickets: First Acceptance

This company specializes in providing insurance coverage for high-risk drivers who have difficulty obtaining coverage elsewhere due to factors such as bad credit, speeding tickets, at-fault accidents, and DUIs.

First Acceptance offers SR-22 forms for individuals with serious violations who require a certificate of financial responsibility.

Best for drivers with accidents: Dairyland

If you have an at-fault accident on your driving record, Dairyland could be a suitable insurance option as they cover high-risk drivers.

The company based in Wisconsin provides unique coverage options that other insurers do not offer, such as non-owner coverage, SR-22 certificates, and limited coverage for travel in Mexico on all California policies.

Best for infrequent drivers: Nationwide

If you drive less than 13,000 miles a year, SmartMiles from Nationwide is a pay-per-mile program that could save you 30% over traditional car insurance.

SmartRide is a feature offered by Nationwide that tracks your driving habits and provides up to 40% off for good driving behavior.

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Geico

Geico, now a subsidiary of Berkshire Hathaway, has been insuring drivers since 1936. The Better Business Bureau has given it an A+ rating, and the National Association of Insurance Commissioners (NAIC) reports that it has significantly fewer complaints than similarly sized providers.

Nationwide availability: Available in all 50 U.S. states and the District of Columbia

Average annual rate for drivers with poor credit: $2,447 per year

J.D. Power claims satisfaction rating: Below average

A.M. Best rating: A++

Amica

In 1907, the Automobile Mutual Insurance Company of America was established as Amica. It was ranked first in J.D. Power's 2023 U.S. Auto Claims Satisfaction Study and was the top-rated provider for overall customer satisfaction in the New England region. Additionally, Amica has fewer complaints about auto insurance than similarly sized competitors, as reported by the NAIC.

Nationwide availability: Available in all states except Hawaii.

Average rate for drivers with poor credit: $2,861 per year

J.D. Power claims satisfaction rating: Above average

A.M. Best rating: A+

First Acceptance

First Acceptance, a Tennessee-based insurer, offers auto, renters, and life insurance to high-risk customers. Despite its relatively small size, the NAIC reports that it has received an unusually high number of complaints. However, the Better Business Bureau has given it an A+ rating.

The product is available in Alabama, Arizona, California, Florida, Illinois, Indiana, Georgia, Mississippi, Ohio, Pennsylvania, South Carolina, Texas, Tennessee, and Virginia.

Average rate for drivers with poor credit: N/A

J.D. Power claims satisfaction rating: N/A

A.M. Best rating: C++

Dairyland

Since 1953, Dairyland, a subsidiary of Sentry Insurance, has been providing auto insurance to motorists with poor driving records and low credit scores. Although J.D. Power did not rate Dairyland, it received an A+ from the Better Business Bureau.

Nationwide availability: Available in 38 states

Average rate for drivers with poor credit: N/A

J.D. Power claims satisfaction rating: N/A

A.M. Best rating: A+

Nationwide

Since 1926, Nationwide, based in Columbus, Ohio, has been providing auto insurance under the name Farm Bureau Mutual Automobile Insurance Company. The NAIC reports that the company receives fewer complaints about auto insurance than other companies of its size. Additionally, the Better Business Bureau has given Nationwide an A+ rating.

Every state except Alaska, Hawaii, Louisiana, and Massachusetts has nationwide availability.

Average rate for drivers with poor credit: $2,606 per year

J.D. Power claims satisfaction rating: Below average

A.M. Best rating: A

How your credit affects your insurance rate

Insurance companies analyze credit history to determine an insurance score in most states, except for California, Hawaii, Maryland, Massachusetts, Michigan, Nevada, Oregon, and Utah, which prohibit or restrict the use of credit-based insurance scores.

Your credit-based insurance score is calculated using most of the same information as your FICO score, and someone with a high credit score is likely to have a high insurance score. The LexisNexis Risk Classifier assigns insurance scores between 200 and 997, with a score of 770 or above getting the most favorable rates, and a score of 500 or below resulting in higher premiums or being turned down for coverage.

You can obtain your LexisNexis insurance score by contacting LexisNexis and requesting a Consumer Disclosure Report.

FICO utilizes an algorithm to determine insurance scores, taking into account five distinct factors, each assigned a unique weight.

Credit history: 40%
Current level of debt: 30%
Length of credit history: 15%
New credit: 10%
Credit mix: 5%

You can request your FICO insurance score from a current or potential insurer.

How to improve your credit score

Improving your credit is the simplest way to enhance your insurance score, as it typically accounts for 40% of it.

Paying your bills on time can significantly improve your credit score.
If you increase your credit limit without increasing your spending, it will decrease your credit utilization ratio.
Applying for a loan or credit card may negatively impact your credit score due to a hard credit inquiry, and also decrease the average age of your credit history if approved.
Ensure the accuracy of your credit report by reviewing it with all three main credit-reporting agencies, Experian, Equifax, and TransUnion, as mistakes are common and some can negatively impact your credit score.

Why trust CNBC Select?

Our mission at CNBC Select is to deliver high-quality service journalism and comprehensive consumer advice to help our readers make informed decisions with their money. We base every car insurance review on rigorous reporting by our team of expert writers and editors with extensive knowledge of insurance products. To research the best insurance companies, we compiled over 100 data points on more than a dozen insurance companies. At CNBC Select, we take pride in our journalistic standards and ethics, and we create all our content without input from our commercial team or any outside third parties. For more information on how we choose the best insurance companies, see our methodology.

Our methodology

CNBC Select evaluated numerous insurance companies and compared them based on multiple factors, including cost, coverage, accessibility, user-friendliness, and customer satisfaction to determine the top insurance companies.

We evaluated various car insurance companies by using a sample premium from Bankrate for a driver with a 580 credit score and incorporating customer satisfaction ratings from J.D. Power, the National Association of Insurance Commissioners, and the Better Business Bureau.

We took into account CNBC Select audience data, including demographics and engagement with our content and tools, when possible.

We organized our recommendations based on affordability, discounts, speeding tickets, at-fault accidents, and infrequent drivers.

Auto insurance companies may change their premiums and policy structures at any time.

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