Cheapest Car Insurance In California
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UPDATED: Mar 18, 2021
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When you’re looking for the cheapest car insurance in California, it’s important to spend time researching your coverage necessities and extra options, as well as comparison shopping between multiple different insurance carriers.
Car insurance costs are dependent on many different variables, including your gender, your age, where you live, where you park your car, what your driving history shows, and what type of vehicle you drive.
When you comparison shop, you can look at the same coverage levels between multiple carriers and use that as an opportunity to negotiate the very best price, whether you choose to pay monthly, semi-annually or annually.
Use these tips to help you differentiate between types of insurance coverage and associated costs so you can get great coverage at a price you can afford.
Top 4 Companies with the Cheapest Car Insurance in California
Here are the 4 companies offering cheap car insurance in California:
Progressive Car Insurance
Known for its Name Your Price tool and the antics of the effervescent Flo on its commercials, Progressive has served consumers for more than 80 years as one of the country’s largest providers of car, motorcycle, boat and RV insurance.
Esurance, a subsidiary of Allstate, began as a discount carrier and is now a major player in the industry with a yearly revenue topping $1.028 billion.
The organization offers both vehicle and home insurance policies.
Available for current and previous service members and their immediate family members, USAA offers comprehensive automobile insurance coverage and a variety of other financial and investment products to its 12.4 million members.
Steeped in more than a century of history and experience, Liberty Mutual is a Fortune 100 company and the fourth-largest insurer in the country, offering coverage for vehicles and structures and in various commercial capacities.
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How Much is Cheap Car Insurance in California?
California offers middle-of-the-road pricing for car insurance premiums, placing neither at the top or bottom of the list of cheaper insurers nationwide.
For the last year with data available, 2015, the National Association of Insurance Commissioners estimates the average annual premium for California car insurance policies to be $986.75, about $20 lower than the nationwide average of $1009.38.
That average rose about $100 between 2011 and 2015.
Take a look at how much car insurance costs in California compared to nearby geographical regions.
|Average Cost of Car Insurance in California||$986.75|
|Average Cost of Car Insurance in Oregon||$904.83|
|Average Cost of Car Insurance in Arizona||$972.85|
|Average Cost of Car Insurance in Nevada||$1,103.05|
|Countrywide Average Cost of Car Insurance||$1,009.38|
As you can see, California rates are very similar to Oregon and Arizona but quite a bit less expensive than Nevada.
What Factors Affect The Cost of Car Insurance in California?
California’s moderate but rising car insurance rates are attributable to several factors.
These include the types of coverage mandated by law, vehicular fatalities per miles driven and your credit score.
1. Mandated Car Insurance Coverage in California
California does not require Personal Injury Protection coverage as a part of car insurance coverage.
The costs savings is clear from eliminating this coverage.
In addition, California requires low levels of dollar amount coverage compared to surrounding states and allows drivers to take advantage of the Low Cost Automobile Insurance Program to save even more.
2. Low Vehicular Fatality Rates in California
Surprisingly, California has very low vehicular fatality rates when calculated against total miles driven and compared to other states.
Clocking in at just .92 fatalities per 100 million vehicle miles driven, this is another factor in the state’s moderately low car insurance rates.
The fewer the crashes and fatalities, the less money an insurance company has to pay out, which keeps costs lower for all consumers.
3. Credit Scores, Rate Approvals and California Car Insurance
Most states require that consumer credit scores be checked as a part of the approval process when obtaining car insurance.
Lower credit scores typically mean higher premiums charged to consumers.
In California, 1988 Proposition 103 removed credit score as a factor from being considered for insurance rates and also mandated that rates could not be imposed without approval by the state’s Insurance Commissioner.
That has helped to keep rates low and not subject to large jumps between years.
What Is Mandatory for Car Insurance in California
Car insurance in California is governed by the Department of Motor Vehicles, which requires that all vehicles on all roadways carry coverage at all times.
As a driver, you must have proof of this financial responsibility with you at all times and have it ready to show to police officers, if involved in a crash, or when renewing your registration.
Three minimum amounts must be met to have legal car insurance coverage in California.
- Injury or death to a single person: $15,000
- Injury or death to more than one person: $30,000
- Property damage: $5,000
These three types of insurance combine to form what’s called liability insurance, which covers your liability to other drivers if you cause a collision.
This is typically the cheapest car insurance California has available.
You may also carry comprehensive or collision insurance to cover damage to your own vehicle or yourself in the case of an accident you cause.
Liability coverage amounts under comprehensive or collision insurance policies must still meet state minimums to be legal.
Think about your personal finances and determine how much car insurance you should carry so that you are protected in the case of an accident.
If you do not maintain the mandatory minimum car insurance liability coverage in California, your vehicle registration may be suspended.
Car insurance carriers in California are required to file reports to the state when you have canceled coverage, or coverage has terminated due to non-payment or other breaches.
If the state doesn’t receive notification of new or resumed coverage within 45 days, your vehicle registration will be canceled.
You’ll need to pay for new insurance as well as a reinstatement fee to make your vehicle legal to drive again.
If you continue to drive with a canceled registration, you can be legally cited, have your vehicle towed and impounded, and are personally liable for any wrecks or injuries you cause.
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6 Ways To Lower the Cost of Your Car Insurance in California
Obtaining the cheapest car insurance in California can be tricky, as there are some factors that play into pricing you simply can’t change.
You can take certain steps to lower the price of your car insurance, however, and that can result in major savings over time.
One option is to look for savings by bundling your car insurance with home or life insurance, qualifying for discounts through your safe driving record, or thanks to an affiliation with certain organizations.
To lower monthly recurring costs, you can also raise your out-of-pocket costs in the case of an accident.
You may also be able to save with safety equipment or features in your car, where you park your car, and by eliminating unnecessary extra coverages that may be nice to have but aren’t required by law.
Let’s take a more in-depth look at the ways to obtain the cheapest car insurance California has available.
1. Bundling Insurance Types
Many insurance carriers insure not only cars but also motorcycles, boats, and houses, and also provide additional products like renter’s insurance, life insurance, and even health insurance.
When you carry multiple policies with the same company, you’ll often be able to take advantage of generous cost savings.
The more policies you have, the more you can save on each.
2. Discounts for Safe Driving
The less you’ve utilized your car insurance in the past, or the fewer infractions or accidents are on your driving record, the safer you’re considered as a driver.
Safe drivers are often able to obtain rates that far less expensive than their counterparts who have multiple citations and accidents on their record.
In addition, some carriers even allow you to install apps on your phone or Bluetooth transponders within your vehicle to track your driving habits and enable you to save more.
3. Affiliations with Organizations
If you’re a veteran, a government employee, the alumni of a particular institution of higher learning, or a member of a large organization, you may also have access to cheaper car insurance in California.
Check with each of these entities to see if they are affiliated with a specific car insurance carrier.
Volume discounts are often offered when many members of the same group use the same carrier.
4. Raise Your Deductible
Your deductible is the amount you’ll pay out of pocket towards coverage if you are involved in an accident.
The higher your deductible, the lower your recurring premium cost.
And you’ll only pay your deductible if you are involved in an accident or file another type of auto insurance claim.
Be sure to pick a reasonable amount that you can afford should you need to.
5. Safety Equipment and Features
If your vehicle comes with a security system, can be tracked if stolen, or has certain safety equipment that engages while driving or when an imminent collision is detected, you may be eligible for cost savings.
Similarly, if you park in a garage at your residence and also use covered and secured parking at your job, you may be able to get certain discounts.
Safety equals saved money.
6. Eliminate Unnecessary Coverage
If you are still paying off your vehicle, your financing organization likely requires that you maintain full insurance coverage, ensuring you are covered if you cause a crash–liability coverage only covers injuries and damage to the other vehicle.
Once you’ve paid off your vehicle, and especially in the case of older, less valuable cars, you can eliminate this extra coverage to save cash.
When you are ready to compare car insurance options and negotiate with carriers, readily have any information needed to prove your group affiliations, the specs on your vehicle to show safety inclusions, the addresses where your vehicle is most commonly parked, personal information you’ll need to change (if applicable), and policy types which can be bundled, and proof that you don’t owe any money on your vehicle (and can, therefore, eliminate some unnecessary coverages).
What Can Increase the Cost of Your Car Insurance in Cali?
Many different components can cause you to miss out on the cheapest car insurance in California.
While your geographical location within the state can influence rates, such as living in Los Angeles, California, so can many other factors about you as a driver as well as the vehicle you drive.
- Age and Gender: If you are under the age of 25, and especially under the age of 18, your car insurance costs will be quite a bit higher than older drivers. Women sometimes pay lower car insurance rates than men, and single drivers often pay higher rates than married drivers. Car insurance carriers use statistical information to determine coverage rates by demographics, based on which populations are more likely to be in car crashes and file insurance claims.
- Driving Record: If you have a history of accidents or violations, even if those instances occurred a couple years ago, a car insurance carrier may deem you to make poor decisions while driving and thus be a higher risk to insure. This will lead to you paying higher premiums for your coverage. After several years, however, citations and accidents will fall off your driving record and you’ll be able to enjoy lower rates again.
- Vehicle Choice: The newer and more expensive your vehicle, the higher your insurance premium will be. This is simple finance in play–if you are in an accident, a newer, more expensive vehicle is more costly to repair or replace. After that, the finances get a bit more complicated. If you seek coverage information for two similarly priced and aged cars, where one is a sports model and the other a luxury minivan, you’ll likely see higher premium costs for the sports car. This is when coverage calculations shift back to statistical methods: you are more likely to drive far and less considerately in a sports car than a minivan filled with your family.
- Driving Habits: When you fill out your car insurance forms to receive estimates of costs, you’ll be asked about when you drive your car–for work, for recreation, or for pleasure. You may need to disclose additional driving habits as well, including driving for car sharing or delivery services or carrying paying passengers in your vehicle. Generally, the more mileage you put on your vehicle per year, the higher your premiums will be because your statistical risk of being involved in a collision will rise. Additionally, if you use your vehicle for business purposes or for paying riders, you’ll likely be subject to higher premiums.
Shopping For The Cheapest Car Insurance in California
When you’re comparison shopping to find the cheapest car insurance in California, obtain at least three quotes so that you can compare which carriers cover what.
Remember that more established and financially solid carriers may also offer higher rates, while newer companies may offer lower rates, but not be as reliable or offer as much support as you’d like in the long run.
Finally, while comparing coverage, take time to read reviews about each company you’re considering to evaluate the average experience a consumer may have with that organization.
Remember to carefully compare coverages between both insurance types as well as between companies, and you’ll be able to score the best value and have access to the cheapest car insurance in California.