No Down Payment Insurance Coverage

No down payment insurance rates will be more expensive monthly that if you pay a deposit up front. You may choose to buy no down payment insurance if you can't make a deposit right away. Auto insurance companies like Allstate, State Farm, and USAA are known to provide no down payment insurance policies. If you decide to make a down payment, you'll need to provide at least 10 percent of the policy's total cost.

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Jul 16, 2021

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  • No down payment insurance costs less upfront but has higher monthly payments
  • Allstate, State Farm, and USAA offer no down payment insurance
  • Some companies require you to pay 10 percent of the total rate to start your auto insurance

If you’re short on money and need an auto insurance policy, you may start your auto insurance without a deposit. No down payment insurance is a cheap way to get auto insurance coverage in place. However, some  companies may not provide this option. testtt

We’ll explain no down payment insurance and explore some alternatives to no down payment auto insurance in this guide. You’ll also have a chance to compare various auto insurance companies to determine which company has the lowest down payment auto insurance rates.

Although some auto insurance companies offer no down payment insurance, some don’t. Using our free online quote tool can help you locate multiple companies in your area that do.

How much are no down payment insurance rates?

No down payment car insurance is determined by your age, driving record, location, credit score, and vehicle. Most of all, your no down payment insurance quotes are based on your auto insurance company.

What is no down payment auto insurance? It’s essentially car insurance where you don’t have to pay a deposit to start a policy.

Most auto insurance companies aren’t identified as a “no down payment insurance company.” If a car insurance company decides to give you coverage with no money upfront, it shouldn’t change the overall (annual or six-month) car insurance cost.

Let’s look at the top auto insurance companies and see how auto insurance rates compare when you buy no down payment insurance versus depositing to start auto insurance.

No Down Payment Insurance Rates by Company
CompaniesAnnual No Down Payment Insurance RatesAnnual Rates After a 10% Percent DepositAnnual Rates After a 20% Percent Deposit
American Family$2,693.61$2,424.25$2,154.89
State Farm$2,821.18$2,539.06$2,256.94
Liberty Mutual$4,774.30$4,296.87$3,819.44
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You can get affordable no down payment insurance by shopping around to find rates. If your annual rate is expensive, you’ll still have to pay the full amount in the end, even without a down payment.

In this case, GEICO and USAA would be the cheapest car insurance companies. However, USAA insurance is only available to military veterans and their immediate families. All other companies on our list are open to everyone.

Allstate, State Farm, and USAA are known to provide customers with a no-down-payment option.

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Can anyone buy no down payment insurance?

No down payment auto insurance is available to most drivers. Some circumstances put drivers in a position where a deposit is too expensive. It’s a short-term solution for individuals who want to be more cost-efficient.

Teen drivers may find it harder to get cheap no down payment insurance. Adding a teen to a parent’s policy is the best way to save.

How can a deposit make my auto insurance more affordable?

The auto insurance deposit you make at the start of your policy chips away at the total cost. Therefore, your car insurance rates per month will be cheaper because you made a deposit.

Each state has a unique law for auto insurance deposits. According to the Commonwealth of Massachusetts, a car insurance company cannot charge more than 30 percent for a deposit to start your policy.

If you choose not to pay a down payment, your monthly auto insurance payments will be more expensive. When shopping, it’s helpful to know how insurance companies calculate your insurance rate. A clean driving record and a good credit history can reduce the cost of car insurance.

No Down Payment Insurance: The Bottom Line

If you need to start your auto insurance coverage right away but don’t have the money, no down payment insurance is perfect for you. Skipping a car insurance deposit will increase your monthly rates, but in the end, you will pay the same total amount.

Now that you know more about no down payment insurance, use our free comparison tool below to compare the best companies in your local area.

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Frequently Asked Questions: No Down Payment Insurance

To wrap up this guide, we’ll answer some frequently asked questions about no down payment insurance.

#1 – Why do insurance companies require a down payment?

A down payment is typically required to prevent drivers from taking out a policy just to get proof of insurance and then failing to pay for it.

#2 – How do you get a low down payment on auto insurance?

The best way is to shop around and compare rates. The lower your overall cost of insurance, the lower the down payment will be.

#3 – How much does auto insurance down payment cost?

A typical deposit is at least 10 percent of your total rate. Anything over 30 percent may not be legal. Check your state’s consumer bill of rights for automobile insurance.

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