How to Get Car Insurance with Bad Credit — and What It Costs

A driver with poor credit (score below 580) typically pays $140–$230/mo for full coverage, compared to $85–$120/mo for excellent credit — an increase of 60% to 90% depending on state and carrier. In Michigan, Florida, and Louisiana, the penalty can exceed 100%. In California, Hawaii, and Massachusetts, credit cannot legally be used in rate calculations at all. The median increase across all states is approximately 76%, according to rate analysis from major carriers. But that average hides massive variation. Some carriers increase rates only 30–40% for poor credit. Others more than double them. This carrier-specific difference is why comparison shopping matters more for bad credit drivers than any other group. Your credit-based insurance score is not identical to your FICO score. Insurers use models from LexisNexis or TransUnion that emphasize payment history, outstanding debt, and length of credit history. A bankruptcy may hit your insurance score harder than your mortgage score. A single missed payment may matter less.

National carriers show dramatic differences in how they price bad credit. Geico and State Farm typically apply smaller credit-based penalties than Progressive or Allstate, though this varies by state. Regional carriers and non-standard insurers like The General, Dairyland, and Bristol West often price more competitively for poor credit because they specialize in higher-risk profiles. The insurer that quoted you the lowest rate when your credit was good is unlikely to remain cheapest now. Carriers that offer deep discounts for excellent credit typically impose steep penalties for poor credit. The inverse is also true: insurers with smaller good-credit discounts usually have smaller bad-credit surcharges. Direct-to-consumer carriers like Root and Metromile use telematics and mileage more heavily than credit, which can work in your favor if you're a safe driver with low annual mileage. These usage-based models don't ignore credit entirely, but they weight it less than traditional actuarial pricing.

California, Hawaii, and Massachusetts ban the use of credit scores in auto insurance pricing entirely. Michigan passed a 2020 law prohibiting credit-based rate increases for existing policyholders, though new customers can still be rated on credit. If you live in one of these states, your credit score is irrelevant to your premium. In all other states, insurers are allowed to use credit as a rating factor, though the weight it carries differs. Maryland, Oregon, and Utah limit how heavily insurers can penalize poor credit. In Maryland, credit cannot be the sole reason for a rate increase or denial. In Oregon and Utah, insurers must file specific justifications for credit-based rate tiers with the state Department of Insurance. If you're considering a move or registering a vehicle in a new state, understanding credit score laws can save you hundreds per year. A driver paying $210/mo in Georgia might pay $110/mo for identical coverage in California, with credit score as the only variable.

Request a credit report review from your insurer every six months. Most carriers re-rate existing policies annually, but you can request a manual review if your score has improved by 50+ points. Some insurers, including Nationwide and Farmers, offer explicit credit improvement discounts when your score crosses certain thresholds. Increase your deductible to lower your monthly payment. Raising your collision and comprehensive deductibles from $500 to $1,000 typically reduces monthly premiums by $15–$25. If bad credit is costing you an extra $60/mo, a higher deductible can offset roughly one-third of that penalty. Just confirm you can cover the higher out-of-pocket cost if you file a claim. Bundle home and auto or add multiple vehicles. Multi-policy and multi-car discounts apply after credit-based pricing, so they reduce your final premium even if your base rate is elevated. Bundling can save 15–25%, which translates to $25–$50/mo for a driver already paying $180/mo due to poor credit. Pay-in-full discounts also apply post-credit-score rating, saving another 5–10% if you can afford a lump-sum payment.

Denial due solely to credit score is uncommon, but it happens. If you're denied, the insurer must send a written adverse action notice explaining the decision and identifying the credit bureau that provided your report. You have 60 days to request a free copy of that report and dispute any errors. If traditional carriers won't offer coverage at any price, your state's assigned risk pool or non-standard market is the fallback. Non-standard insurers like Acceptance, Direct Auto, and Safe Auto specialize in high-risk drivers and rarely decline applicants based on credit alone. Rates are higher — often $200–$350/mo for minimum liability — but coverage is available. Some states operate residual market programs for drivers who can't obtain coverage in the voluntary market. These programs assign you to an insurer that must provide a policy, typically at higher rates. Contact your state Department of Insurance if you've been denied by three or more carriers. In most states, that triggers eligibility for assigned risk placement.

Get quotes from at least five carriers, including one regional and one non-standard insurer. National brand recognition does not predict who will offer the best rate for poor credit. The spread between the most expensive and least expensive quote for identical coverage can exceed $150/mo. Request quotes for multiple coverage levels. If full coverage is unaffordable, price out high liability limits with no collision or comprehensive. A 100/300/100 liability-only policy may cost $70–$110/mo even with poor credit, compared to $180–$240/mo for full coverage. If your vehicle is older and paid off, dropping physical damage coverage is often the most effective cost reduction. Use your actual credit profile when comparing quotes online. Some comparison tools let you skip the credit check, but the resulting quote will be based on excellent credit and will increase significantly when you apply. An accurate quote requires a soft credit pull. Soft pulls don't affect your credit score, and getting multiple insurance quotes within a 14-day window counts as a single inquiry for scoring purposes.