New driver? No credit history? Good news — affordable options exist. This friendly guide walks new drivers through how insurers look at credit, which companies often give competitive rates, and practical steps you can take today to lower your premium without sacrificing coverage.
Why credit matters (and when it doesn't)
Many insurers use a credit-based insurance score (different from your credit-report score) as one of several factors when setting premiums. That means if you have no credit history or "thin" credit, some insurers might charge more — but others weigh driving record, vehicle type, and household policies more heavily. Rules also vary by state: a few states prohibit use of credit in pricing.
- Tip: Ask insurers whether they use credit-based scoring in your state before you give personal info.
- Tip: If your state forbids credit-based pricing — you may already have an edge.
Start here: companies to price-shop first
No single insurer is cheapest for everyone — but national analyses repeatedly show a handful of companies that commonly return low quotes for drivers with limited or no credit. It's smart to get online quotes from at least 4–6 providers (and include local regional insurers, which can be surprisingly affordable).
| GEICO | Large national; often competitive for young/new drivers. |
| USAA | Lowest for eligible military families — exceptional pricing and service. |
| Auto-Owners / Mapfre / Regional Mutuals | Smaller carriers can be very cheap in specific states. |
| Progressive / State Farm / Travelers | Good discounts, telematics apps, and drive-score programs. |
How to get the cheapest rate when you have no credit
- Bundle with family: Adding a new driver to a parent’s policy often lowers cost versus a solo new policy.
- Pick the right car: Insuring a safe, inexpensive-to-repair car is cheaper than a sporty model.
- Opt for telematics: Usage-based programs (safe-driving apps) can cut rates if you drive responsibly.
- Raise your deductible: A higher deductible lowers premiums — but keep an emergency fund.
- Look for discounts: Good-student, defensive-driving course, multi-policy, and low-mileage discounts add up.
Reality check: what to expect on price
Average numbers vary widely by state and coverage level. For context, full-coverage rates for new drivers without a strong credit history commonly range from low hundreds per month to more than that depending on state laws, vehicle, and driving record. Liability-only minimum coverage can be much cheaper but may leave you exposed after a serious crash — balance price with protection.
Smart shopping checklist
- Get quotes from at least 4 companies (include local mutuals).
- Ask explicitly: “Do you use credit-based insurance scoring in this state?”
- Ask which discounts apply to new drivers (good grades, safety features, telematics).
- Compare total annual cost — not just the monthly premium.
Ready to shop? Start with price comparison tools (they pull several quotes) and then call the handful of insurers that look cheapest — sometimes agents can find discounts online tools miss. If you're a military family, check USAA for industry-leading pricing. For broad comparison start points try NerdWallet or Bankrate.
Fast FAQ
Q: Can I get very cheap insurance with absolutely no credit?
A: Yes — but it depends on state and insurer. Shop widely, lean on family bundling, and consider telematics to prove safe driving.
Q: Should I ever lie about my credit history to save money?
A: No — inaccurate info can void claims and break laws. Always be honest.