D. Gilson is a writer and author of essays, poetry, and scholarship that explore the relationship between popular culture, literature, sexuality, and memoir. His latest book is Jesus Freak, with Will Stockton, part of Bloomsbury’s 33 1/3 Series. His other books include I Will Say This Exactly One Time and Crush. His first chapbook, Catch & Release, won the 2012 Robin Becker Prize from Seve...

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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 appeared on legaladvice.com, themanifest.com, and vice.com.

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Reviewed by Jeffrey Johnson
Insurance Lawyer

UPDATED: Jan 7, 2021

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Just the Basics

  • No down payment car insurance carries higher than average premiums.
  • The less you deposit at the beginning of the car insurance policy, the more you’ll pay per month.
  • Car insurance discounts can lower your annual premiums.

No down payment car insurance allows you to buy a car insurance policy without putting any money down to start the policy. However, there’s a consequence of skipping the down payment option.

Under the right conditions, the factors that affect the price of car insurance can offset expensive monthly car insurance rates. Read our guide to learn how you can secure very cheap car insurance with no deposit.

Enter your ZIP code to start comparing companies with cheap, no down payment car insurance options.

What is no down payment car insurance?

No down payment auto insurance is the process of skipping the deposit phase when you want to start your auto insurance policy. However, there’s a catch to no deposits.

When you start a car insurance policy with no deposit, you risk paying for higher premiums per month.

The more you deposit on your car insurance policy, the cheaper your rates will be per month.

Let’s look at an example of a six-month car insurance policy that’s worth $1,600.

Average Monthly Car Insurance Rates Affected by Down Payments
Down PaymentsAverage Monthly Car Insurance Rates
0% or No Down Payment$267
10% or $160$240
20% or $320$213
30% or $480$187

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Monthly car insurance payments decrease the more you deposit. When you buy no down payment car insurance, you’ll likely pay higher costs.

No down payment auto insurance is convenient when you’re short on cash, but it can hurt your finances in the long term.

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What companies offer no down payment car insurance?

There isn’t an exclusive no down payment car insurance company. In other words, you won’t find an auto insurance provider that refuses a deposit.

However, you can find companies all over the United States that permit customers to skip the deposit step to start a car insurance policy.

Let’s compare the average car insurance rates from the top companies and compare them to policies with a ten percent deposit.

Comparing No Down Payment Car Insurance Rates by Company
Car Insurance Companies with No Down Payment RulesAverage Annual Car Insurance Rates with No Down PaymentAverage Monthly Car Insurance Rates with No Down PaymentAverage Annual Car Insurance Rates with a 10% Down PaymentAverage Monthly Car Insurance Rates with a 10% Down Payment
Allstate$4,898$408$4,408$367
American Family$3,443$287$3,099$258
Farmers$4,189$349$3,770$314
GEICO$3,216$268$2,895$241
Nationwide$3,447$287$3,102$259
Progressive$4,044$337$3,639$303
State Farm$3,268$272$2,941$245
Travelers$4,445$370$4,000$333
USAA$2,542$212$2,288$191

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As expected, the auto insurance rates with a deposit have lowered the cost per month and per year.

To secure affordable no down payment car insurance, you’ll need to pay more at the start of the policy.

Now imagine the savings when you factor in car insurance discounts. The biggest savings come from clean driving records and good credit.

Why good credit? According to Experian, consumers with good credit receive cheaper rates because they correlate to lower risks.

No Down Payment Car Insurance: What’s the bottom line?

No deposit at the start of your car insurance policy can save you money right away, but you’ll have to fight higher premiums.

But you can slash prices with car insurance discounts. Ask your car insurance provider what discounts you qualify for. Do everything you can to lower your premiums.

If you want to learn more, read our car insurance guide—it has many extensive details that will help you secure cheap car insurance rates.

Start comparing companies that permit no down payment car insurance by entering your ZIP code in the FREE online tool below.

Frequently Asked Questions: No Down Payment Car Insurance

For the final section of the guide, we’ll answer a few frequently asked questions.

#1 – How much does no down payment car insurance cost?

No down payment car insurance monthly rates depend on the policy price. If you have a $3,000 annual policy, your monthly rates will be $250 per month.

#2 – Why do car insurance companies ask for down payments?

The deposit is one of the steps to determine risk. A no down payment could increase your level of risk to insure.

#3 – Do all car insurance companies have no down payment car insurance?

No. Some car insurance providers have a mandatory deposit rule.