The average annual rate of car insurance for a financed car is $2,520, and the minimum coverage starts from $780. But a financed car needs full coverage to meet loan requirements.
There are different cheap insurance options for financed cars available but compare them to find the best one that meets your needs.
A financed car has a specific need to take particular insurance to meet the loan requirements. If not, the lender may add more to your monthly debt or even decline the loan. Financed cars require full coverage, and it should be maintained for a specific period.
Full coverage car insurance usually includes:
No, there is no difference in car insurance costs between a financed vehicle and a leased car. Only if the lender has specific protocols to select a particular insurance policy would that be a concern. While many factors like age, experience, and type of car determine car insurance rates, financing does not affect the cost.
USAA provides the cheapest car insurance for financed cars, with an average annual premium of $1,960, followed by State Farm at $2,100. The most expensive insurance for a financed car is from Allstate at $3,309.
| Carrier | Average Annual Premium |
|---|---|
| USAA | $1,960 |
| State Farm | $2,100 |
| Travelers | $2,151 |
| Progressive | $2,379 |
| Allstate | $3,309 |
The cheapest Financed car insurance company depends on the state. State Farm has the lowest rates in most places but Travelers, Farm Bureau, Progressive, and Erie are the cheapest in some states. For instance, Progressive is the best deal in Michigan and New York. Farm Bureau is the cheapest in states like Georgia, Kentucky, and Texas.
| State | Cheapest Company |
|---|---|
| Alabama | State Farm |
| Alaska | State Farm |
| Arizona | State Farm |
| Arkansas | State Farm |
| California | GEICO |
| Colorado | State Farm |
| Connecticut | Travelers |
| Delaware | State Farm |
| Florida | State Farm |
| Georgia | Farm Bureau |
| Hawaii | GEICO |
| Idaho | State Farm |
| Illinois | Country Financial |
| Indiana | Travelers |
| Iowa | State Farm |
| Kansas | Travelers |
| Kentucky | Farm Bureau |
| Louisiana | Farm Bureau |
| Maine | Travelers |
| Maryland | State Farm |
| Massachusetts | GEICO |
| Michigan | Progressive |
| Minnesota | Travelers |
| Mississippi | State Farm |
| Missouri | American Family |
| Montana | State Farm |
| Nebraska | State Farm |
| Nevada | Travelers |
| New Hampshire | Hanover |
| New Jersey | GEICO |
| New Mexico | State Farm |
| New York | Progressive |
| North Carolina | Erie |
| North Dakota | State Farm |
| Ohio | GEICO |
| Oklahoma | State Farm |
| Oregon | State Farm |
| Pennsylvania | Travelers |
| Rhode Island | Travelers |
| South Carolina | Auto-Owners |
| South Dakota | State Farm |
| Tennessee | Erie |
| Texas | Texas Farm Bureau |
| Utah | Progressive |
| Vermont | State Farm |
| Virginia | Farm Bureau |
| Washington | State Farm |
| Washington, D.C. | GEICO |
| West Virginia | Erie |
| Wisconsin | Erie |
| Wyoming | State Farm |
If your new car has a higher value than your old one, your insurance premium may go up—especially if you switch from liability-only to full coverage. But don't worry! Here are some simple ways to lower your financed insurance costs:
Compare rates: Different insurance companies charge different prices. Getting multiple quotes can help you find the best deal.
Choose the right car: Luxury, sports, and foreign cars often have higher insurance rates due to repair costs and risk factors. Picking a more affordable model can help lower your premium.
Look for discounts: Many insurers offer discounts for bundling policies, insuring multiple cars, or maintaining a clean driving record. Always check what discounts you qualify for.
Drive safely: Tickets, accidents, and DUIs can increase your insurance costs. Safe driving helps you avoid surcharges and keeps your premium lower.
Try telematics programs: Some insurers offer discounts based on driving habits, like speed and braking patterns. Safe driving can lead to lower rates.
Raise your deductible: Choosing a higher deductible can reduce your monthly premium, but make sure you can afford to pay it if you need to file a claim.
The auto insurance rates published in this guide are based on the results of research completed by Way.com’s data team. Using a mix of public and internal data, we analyzed millions of rate averages across U.S. ZIP codes.
Quotes are typically based on a full coverage policy average unless otherwise noted within the content.
These rates were publicly sourced from insurer filings and should be used for comparative purposes only — your own quotes will differ. Given this, it’s important to go through our insurance steps form to find how much you can save with way.com
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