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Why You Can Trust the MarketWatch Guides Team
Here’s a breakdown of how we reviewed and rated the top auto insurance providers
130
Providers ReviewedOur team looked at over 100 of the top auto insurance providers in the U.S., from national providers like USAA, Travelers and State Farm to regional providers like Erie Insurance.
8,500
Data Points AnalyzedTo properly score each auto insurance provider, we looked at cost data, claims processes, customer review scores, industry standing, available discounts, coverages and add-ons.
800
Research HoursOur team put in the time so you don’t have to, evaluating cost data, reading customer reviews and researching companies to determine the most reliable options for coverage.
8,500
Customers SurveyedWe asked thousands of customers to describe their experience with their auto insurance provider to understand how real customers feel about their insurers.
Learn more about our methodology and editorial guidelines.
Cheapest Liability Car Insurance
If you want cheap car insurance, you may want to consider purchasing liability-only coverage that matches your state’s minimum car insurance requirements.
We researched the cheapest car insurance companies and the states that tend to have the most affordable liability insurance. The estimates in the sections below are based on a single 35-year-old driver with good credit and a clean driving record.
Which Companies Offer the Cheapest Liability Car Insurance?
Based on our research, Country Financial typically offers the cheapest liability coverage on average, at $30 per month or $356 per year. The next cheapest liability auto insurance coverage often comes from Auto-Owners Insurance, which charges an average of $30 per month or $358 per year.
Insurance Provider | Average Monthly Estimate | Average Annual Estimate |
Country Financial | $30 | $356 |
Auto-Owners Insurance | $30 | $358 |
USAA* | $32 | $387 |
Erie Insurance | $33 | $390 |
Geico | $38 | $461 |
State Farm | $44 | $523 |
Nationwide | $44 | $531 |
National Average | $52 | $627 |
Travelers | $54 | $648 |
Progressive | $58 | $697 |
American Family Insurance | $67 | $810 |
Cheapest Liability Car Insurance by State
According to our estimates, the state with the cheapest liability auto insurance is Iowa. The average cost of a liability-only policy in the Hawkeye State is typically $23 per month or $274 per year. Florida has the most expensive liability insurance, with rates that tend to average $115 per month or $1,385 per year.
State | Average Monthly Estimate | Average Annual Estimate |
Iowa | $23 | $274 |
Wyoming | $26 | $308 |
Vermont | $26 | $310 |
South Dakota | $27 | $328 |
Nebraska | $30 | $356 |
Idaho | $31 | $378 |
Maine | $32 | $380 |
Montana | $33 | $398 |
Tennessee | $34 | $404 |
Wisconsin | $34 | $408 |
New Hampshire | $35 | $415 |
Indiana | $36 | $432 |
Pennsylvania | $36 | $437 |
Illinois | $37 | $441 |
North Dakota | $37 | $445 |
Arkansas | $38 | $451 |
Mississippi | $38 | $453 |
North Carolina | $39 | $469 |
Kansas | $40 | $475 |
Minnesota | $40 | $481 |
Alaska | $41 | $486 |
Alabama | $42 | $502 |
Oklahoma | $43 | $516 |
Hawaii | $44 | $529 |
Ohio | $45 | $536 |
New Mexico | $45 | $536 |
Virginia | $45 | $545 |
Missouri | $47 | $560 |
Washington | $47 | $561 |
Colorado | $47 | $566 |
California | $50 | $602 |
West Virginia | $50 | $604 |
Arizona | $53 | $635 |
Georgia | $57 | $680 |
Kentucky | $57 | $682 |
Texas | $57 | $683 |
Washington D.C. | $57 | $686 |
South Carolina | $58 | $701 |
Utah | $61 | $732 |
Massachusetts | $63 | $754 |
New York | $73 | $870 |
Maryland | $75 | $901 |
Louisiana | $77 | $925 |
Oregon | $79 | $953 |
Connecticut | $82 | $980 |
Rhode Island | $86 | $1,036 |
Delaware | $99 | $1,194 |
Nevada | $107 | $1,283 |
New Jersey | $111 | $1,332 |
Michigan | $113 | $1,360 |
Florida | $115 | $1,385 |
What Is Liability Car Insurance?
Liability car insurance covers the cost of property damage and personal injuries to another party if you’re found to be at fault for a car accident. Your insurance provider pays out the cost of repairs for someone else’s vehicle or the cost of medical bills if the other party is injured.
Each state sets its own legally required minimum coverage, which usually includes some form of liability insurance. Virginia and New Hampshire are the only exceptions, as neither state requires motorists to have any car insurance.
Liability Car Insurance Coverage
Coverage limits for liability insurance are indicated by three numbers. Each number represents one kind of the following types of liability coverage:
- Bodily injury liability (BI) per person: This covers medical bills, lost wages and pain-and-suffering expenses.
- Bodily injury liability per accident: This is the maximum amount of bodily injury expenses the insurance company will pay out per accident.
- Property damage liability (PD) per accident: This covers vehicle and other property damage, as well as any cleanup costs associated with the accident. If you’re sued, this also helps pay for court costs.
An example liability insurance policy could be written as 25/50/25, which would mean you’d have $25,000 in bodily injury liability coverage per person, $50,000 in bodily injury liability coverage per accident and $25,000 in property damage liability coverage per accident.
What Does Liability Car Insurance Not Cover?
Liability car insurance doesn’t cover damages to your vehicle or costs related to your injuries. This is where collision insurance and medical payment or personal injury protection come in. Collision insurance covers the cost of repairs to your car. Medical payments coverage (MedPay) or personal injury protection (PIP insurance) covers your medical bills.
It’s good to note that if you aren’t deemed at fault for the accident, you and your insurance company won’t be responsible for the other person’s property damage or injuries.
Should I Get Liability-Only Car Insurance?
If you have an auto loan or lease, you’ll likely be required to maintain full-coverage car insurance. With that in mind, you should only consider liability-only car insurance if you own your vehicle outright.
You also have to remember that comprehensive and collision coverages are better deals when you own a new car. As your vehicle ages, the maximum payout you can receive for a claim declines. Once your car reaches 10 to 12 years of age and sees its total value drop below $10,000, it’s hard to justify full-coverage car insurance a good deal.
Liability Car Insurance Vs. Full-Coverage Car Insurance
A full-coverage policy typically includes state-required liability limits as well as collision coverage and comprehensive coverage. Some full-coverage policies may also include uninsured motorist coverage (UM) since some states require it.
Liability Car Insurance Vs. Full Coverage Car Insurance Costs
Liability-only car insurance often has the cheapest rates in the industry — especially over full coverage. This is because liability coverage doesn’t provide as many types of protection. Here’s a look at how average annual estimates for both types of coverage compare:
Insurance Provider | Average Annual Estimate for Liability Coverage | Average Annual Estimate for Full Coverage |
Country Financial | $356 | $1,411 |
Auto-Owners Insurance | $358 | $1,619 |
USAA* | $387 | $1,512 |
Erie Insurance | $390 | $1,458 |
Geico | $461 | $1,596 |
State Farm | $523 | $1,657 |
Nationwide | $531 | $1,433 |
Travelers | $648 | $1,595 |
Progressive | $697 | $2,030 |
American Family Insurance | $810 | $1,851 |
As you can see, it’s not uncommon for liability-only car insurance to cost 60% less than a full-coverage policy. Again, this is a matter of getting what you pay for, seeing as a full-coverage car insurance policy offers significantly more protection than liability coverage alone.
Here are a few things that aren’t covered when you opt for liability-only car insurance:
- Damage to your vehicle from an at-fault accident
- Damage to your vehicle from a hit-and-run incident (if you don’t have uninsured motorist coverage)
- Damage from vandalism and theft
- Damage from environmental dangers such as hail and tornadoes
- Damage from hitting an animal with your car
Factors That Affect Car Insurance Rates
When calculating auto insurance quotes, insurance companies take a look at several factors to estimate what you’ll pay.
Here are some items that have major influence on your car insurance rates:
- Location: Drivers in areas with high rates of theft, vandalism and car accidents tend to pay more for car insurance.
- Age: Insurers consider young drivers a higher risk than drivers with more experience, which is why teen drivers’ insurance usually costs more.
- Driving record: If you have a good driving history, you’ll likely pay less for insurance. Drivers with speeding tickets or DUI convictions often pay much more for coverage.
- Credit history: Insurance providers view drivers with higher credit scores as less likely to file claims than those with poor credit, so drivers with good credit pay lower insurance premiums in most states.
- Gender: Women tend to get into fewer accidents and have fewer traffic violations than men, so they often pay less for coverage in most states.
- Marital status: Married drivers have an easier time finding low-cost auto insurance than single drivers because they’re considered safer drivers and more financially stable.
- Vehicle details: Insurers charge higher rates for cars that are more expensive, cost more to repair after accidents and are more likely to be stolen. A vehicle’s safety record also plays a part in determining insurance costs.
- Coverage options: Your car insurance rates are affected by the type of car insurance you get, the amount of coverage you purchase and the deductible you select.
To find more affordable car insurance, you can work to raise your credit score and avoid traffic violations. We also recommend asking your provider about any available car insurance discounts. Some providers offer discounts to good drivers or to policyholders who bundle their car insurance with homeowners or renters insurance. Discounts for good students and members of various professional organizations are also common.
Cheapest Liability-Only Car Insurance: The Bottom Line
The cheapest liability car insurance is usually the minimum coverage level your state requires for you to legally drive. Each state sets its own requirements, so the cost of liability-only insurance varies from state to state. We recommend gathering quotes from at least three providers in your search for the right policy for your needs.
Cheapest Liability-Only Car Insurance: Recommended Providers
If you plan to buy a liability-only car insurance policy, it’s worth looking at policies offered by USAA and Erie Insurance.
USAA: Best for Military Members
Overview
From researching the top insurance companies in the country, we found that USAA consistently offers some of the lowest car insurance rates available. In addition to having cheap average liability coverage, USAA offers a wide range of coverage options that include accident forgiveness and classic car insurance.
USAA also holds an A++ rating from AM Best, which showcases its financial strength and credibility as a business. Keep in mind that USAA coverage is only available to active-duty members of the military, veterans and their immediate family members.
Read more: USAA insurance review
Erie Insurance: Best for Basic Insurance Coverage
Overview
If you live in Washington, D.C., or any of the 12 states that Erie serves, it may be the right choice for cheap car insurance. The company is known for its affordable rates, charging an average of 28% less than the national average, for both liability coverage and full coverage.
In addition to cheap liability coverage, Erie offers a slate of full coverage options and many optional add-ons. The provider also holds superior financial strength, according to AM Best, which suggests it will likely pay out claims.
Read more: Erie Insurance review
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Cheapest Liability-Only Car Insurance: FAQ
Below are frequently asked questions about the cheapest liability-only car insurance.
In most states, you need at least $50,000 in bodily injury liability coverage per accident ($25,000 per person) and $25,000 in property damage liability coverage. Some states also require uninsured motorist coverage along with either personal injury protection or medical payments coverage.
The lowest you can pay for car insurance is usually the cost of your state’s minimum liability coverage, which varies based on factors like your vehicle and location. Based on our research, Country Financial typically offers the cheapest liability coverage on average, at $30 per month or $356 per year. Iowa has the lowest average liability-only policy costs in the U.S. at $23 per month or $274 per year.
Liability insurance is generally the cheapest car insurance coverage because it only covers the cost of bodily injuries and property damages for another party if you’re at fault for an accident. It doesn’t cover damages to your vehicle or costs associated with your injuries.
Driving without insurance is illegal in every state except for Virginia and New Hampshire. The penalties for getting caught driving without insurance vary by location.
Country Financial is generally the cheapest insurance company for minimum liability car insurance, with an average rate of $30 per month or $356 per year for single 35-year-old drivers with good credit and clean driving histories. Auto-Owners Insurance is right behind Country Financial, with an average of $30 per month or $358 per year for liability coverage.
Our Methodology
Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the insurers that scored the most points topping the list.
Here are the factors our ratings take into account:
- Cost: Auto insurance rate estimates generated by Quadrant Information Services and discount opportunities were both taken into consideration.
- Coverage: Companies that offer a variety of choices for insurance coverage are more likely to meet consumer needs.
- Reputation and experience: Our research team considered market share, ratings from industry experts and years in business when giving this score.
- Availability: Auto insurance companies with greater state availability and few eligibility requirements scored highest in this category.
- Customer experience: This score is based on volume of complaints reported by the NAIC and customer satisfaction ratings reported by J.D. Power. We also considered the responsiveness, friendliness and helpfulness of each insurance company’s customer service team based on our own shopper analysis.
Our credentials:
- 800 hours researched
- 45 companies reviewed
- 8,500+ consumers surveyed
*Data accurate at time of publication.
If you have feedback or questions about this article, please email the MarketWatch Guides team ateditors@marketwatchguides.com.