When you think about car insurance companies, you probably think about some of the biggest names in the industry. Large companies like GEICO and Progressive have big advertising budgets and commercials that are designed to keep those companies top of mind when it comes time to shop for a new insurance policy.
Compare rates and shop affordable car insurance today
We don't sell your information to third parties.
But a big insurance company might not be right for you. Choosing a small car insurance company could come with multiple benefits, including specialized coverage and (sometimes) lower rates.
Key takeaways
Smaller car insurance companies sometimes offer much lower rates than their larger counterparts.
Small car insurance companies are more likely to have unique options like rates based mostly on telematics and not on age or gender.
Small insurance companies often don’t have a very big marketing budget, which means you may not know about some of the car insurance options available in your area.
Can smaller companies give me better car insurance rates?
Yes, sometimes. Some of the larger insurance companies, like GEICO or USAA, are known for offering low rates for most drivers, but a smaller company might offer you even better rates.
For example, the average cost for full coverage with GEICO in Texas is $1,383 per year, but the same amount of coverage with Texas Farm Bureau costs an average of $1,036 per year, pretty significant savings.
This isn’t a guarantee, of course, but small companies are often able to offer lower rates than their larger, more well-known counterparts.
Cheapest small car insurance companies
Small car insurance companies sometimes offer excellent rates. For example, the lowest car insurance rates in California are with Wawanesa, a small insurance company that only offers coverage in California and Oregon.
Here are the 25 cheapest small insurance companies across the country.
Insurance company | Minimum coverage | Full coverage |
|---|---|---|
Root | $357 | $707 |
American National | $217 | $768 |
FAIA | $277 | $790 |
North Carolina Farm Bureau | $332 | $799 |
Western Agriculture | $378 | $871 |
Integrity Insurance | $178 | $898 |
Concord Group | $394 | $906 |
Union Mutual | $194 | $941 |
MMG | $377 | $955 |
Rural Mutual | $238 | $967 |
West Bend Mutual | $320 | $992 |
SECURA | $349 | $1,003 |
Countryway | $361 | $1,040 |
MAPFRE | $335 | $1,066 |
Texas Farm Bureau | $387 | $1,128 |
PEMCO Insurance | $343 | $1,143 |
Indiana Farmers Insurance | $371 | $1,153 |
Wawanesa | $494 | $1,153 |
Norfolk & Dedham | $470 | $1,156 |
Virginia Farm Bureau | $417 | $1,164 |
Patriot Insurance | $266 | $1,176 |
Oregon Mutual | $571 | $1,209 |
Amco | $387 | $1,212 |
Indiana Farm Bureau | $400 | $1,212 |
Island Insurance | $360 | $1,251 |
Are small car insurance companies good?
When it comes to cost, some small car insurance companies, like Western Agriculture and North Carolina Farm Bureau, offer incredibly low average rates. And high-risk drivers with a DUI or at-fault accident on their records may be able to find cheaper coverage with a small car insurance company, even if they need an SR-22.
On the other hand, some smaller insurance companies, like Chubb and AIG, offer specialized products for high net worth drivers, which means the coverage will be more expensive but tailored to meet the needs of people who have a fleet of vehicles or multiple classic cars.
And drivers who want rates based primarily on how they drive can buy a policy from a usage-based company like Root, which uses telematics information to set your rates based on how you drive during a trial period.
→ Read more about our picks for the best car insurance companies
Is coverage different with a smaller insurer?
It can be, depending on the insurance company. Some smaller car insurance companies compete by offering different types of coverage (or more coverage options).
For instance, Nodak Insurance offers auto, homeowners, and life insurance, just like many larger insurance companies.
However, Nodak also offers farm and ranch coverage, along with crop hail protection and multiple peril crop insurance, which means their coverage options are uniquely tailored to the needs of farmers and ranchers in North Dakota, where the company sells policies.
Compare rates and shop affordable car insurance today
We don't sell your information to third parties.
Pros and cons of small car insurance companies
There are many benefits to choosing a smaller car insurance company, but there are also some drawbacks, too. Let's break down the pros and cons of smaller car insurance companies.
Pros of small car insurance companies | Cons of small car insurance companies |
|---|---|
More likely to have specialized insurance policies | Not as well known so it is harder to find information about them |
Likely to have a more personal relationship with agents and other employees | Less likely to have 24 hour service options like online bill pay |
Coverage is more likely to be designed specifically for the needs of the people in one specific state or area | Coverage isn't available nationwide, which means you may have to switch insurance companies if you move out of state |
How to choose a small car insurance company
Whether large or small, choosing a car insurance company is about finding the company that offers the coverage you need at a price you can afford. For example, if you have a loan on your vehicle and you need gap insurance, an insurance company that doesn’t offer that coverage isn’t going to be right for you.
Smaller insurance companies often don’t have much of an advertising budget, which means you may not know about some of the car insurance options available in your area.
You may need to do a lot of research and ask a lot of questions to find out what options are available in your state. Shopping with an online marketplace like Policygenius is a good way to make sure you are getting quotes from as many insurance companies as possible.
Frequently asked questions
Who usually has the lowest car insurance?
According to our data, USAA and MAPFRE have the cheapest average rates for full-coverage auto insurance at $87 per month. However, there may be cheaper companies available in your area, depending on where you live.
How can I be sure a small car insurance company can pay my claim?
The best way to make sure your insurance company is on the up-and-up is to do your research. For example, you can check an insurance company’s financial stability by reviewing their rating with A.M. Best or Moody’s and you can see how they treat customers when they file a claim by reading customer reviews online.
What's the cheapest liability insurance you can get?
According to our data, Auto-Owners has the cheapest liability car insurance at $27 per month. However, GEICO offers affordable coverage that is more widely available than Auto-Owners.
What is a non-standard auto insurance company?
There are two kinds of non-standard auto insurance. The first kind is coverage for high-risk drivers, which is the same as regular auto insurance but with much higher rates. The second (less common) type of non-standard coverage is insurance for drivers with unique needs, like drivers who need insurance but don’t own a car.
Methodology
Policygenius has analyzed car insurance rates provided by Quadrant Information Services for every ZIP code in all 50 states, plus Washington, D.C.
For full coverage policies, the following coverage limits were used:
Bodily injury liability: 50/100
Property damage liability: $50,000
Uninsured/underinsured motorist: 50/100
Comprehensive: $500 deductible
Collision: $500 deductible
In some cases, additional coverages were added where required by the state or insurer.
Rates for overall average rate, rates by ZIP code, and cheapest companies determined using averages for single drivers age 30, 35, and 45. Our sample vehicle was a 2017 Toyota Camry LE driven 10,000 miles per year.
Rates for driving violations and “poor” credit were determined using average rates for a single male 30-year-old driver with a credit score under 578.
Some carriers may be represented by affiliates or subsidiaries. Rates provided are a sample of insurance costs. Your actual quotes may differ.
