The 3 Car Insurance Companies That Give You The Option Of No Down Payment

Getting car insurance with no down payment is no easy task. Most companies won’t even offer it. And those that do, very rarely advertise it. This is due to the fact that car insurance companies want to deal with drivers that aren’t considered high risk. And if you are unwilling to put up a down payment for your new insurance policy, they consider that high risk.

Also, paying a down payment is a good decision on your part. When you make a down payment, it gets built into your rate and you won’t have to pay that on your monthly premium. If you’re looking to get lower rates, paying a decent down payment is one of the best ways to do just that.

Now, there are reasons why you may want to approach this decision. Some of us just really need car insurance quickly and don’t want to have to spend more upfront to get the coverage. But there are times when drivers are just trying to satisfy a dealership in order to drive a car off the lot. Those are the drivers seeking no down payment policies, at least, that is the car insurance companies view of it.

Of course, it could also be that you aren’t sure of the car insurance company and whether or not you will like them that could really be the reason. Since your down payment is really a reduction of your future monthly payment, you are gambling on liking the company you choose. Therefore, it is always a good practice to get quotes from a few different car insurance companies first and then read the reviews about them from other drivers.

No matter what your reason, I wanted to find the best car insurance companies that offer a no down payment option, in case this just happens to be what you are looking for.

Compare No Down Payment Auto Insurance Quotes

Car Insurance with no Down Payment Overview

Company Best for Average premium
(Monthly rate for 25-year old female driving ‘17 Jetta with no prior accidents)
State Farm Low rates $284.95
USAA Military members Varies (but highly competitive)
Allstate Lower credit borrowers $392

Finding a car insurance company that is willing to give you insurance without a down payment or deposit is a pretty difficult feat. However, there are a few that will allow it, in certain states, and if you ask nicely. 

About average premiums

Average premiums were calculated using the following mock profile:

  • Jennifer, age 25, is single, employed, and has no prior accidents.
  • She leases a 2017 Volkswagen Jetta 1.4 SE.
  • She rents an apartment in zip code 30324 (North Atlanta).
  • She secures every logical discount and opts into telematics programs (Progressive Snapshot, etc.).

While the above chart might offer a very rough idea of what you might pay with Allstate and State Farm, keep in mind that everyone’s case is different (I couldn’t generate a sample quote from USAA without a military ID). Anyways, chances are that your profile varies from Jenny’s and your quotes will also as a result. 

The only way to find which provider will offer you the best rates is to generate accurate, personalized quotes from each of them. Thankfully, you can expedite the process with aggregators.


Best Car Insurance For No Down Payment - Allstate

Allstate is a fairly well heard of company across the US. Their insurance products are available to anyone who qualifies. This is generally based on your credit score and accident history. However, they still might be willing to cover you even if you have a low credit score, just at a higher rate.

Since Allstate’s rates tend to be on the higher side, that could cost you a pretty penny. But, if you are searching for a company that offers the option of not paying a down payment to get car insurance, this is one of the few. However, it is not widely advertised. So in order to get the option, you will have to speak with a live agent to see if you qualify.

Learn more about Allstate or read our full review

State Farm

Best Car Insurance For No Downpayment - State Farm

State Farm is another company that almost everyone has heard of. State Farm is very similar to Allstate with regard to their application process. The biggest difference between the two companies is the rates. 

Generally speaking, State Farm offers much better rates for those with credit scores of 800 or higher. If you have a much lower credit score under 600, then Allstate would be a much better option for you.

Either way, this is one of the few other companies that offer the option of starting a policy with no down payment. But, just like Allstate, you will have to speak to an agent to get this option offered to you. Neither company gives the option when you apply online.

Learn more about State Farm or read our full review.


Best Car Insurance For No Downpayment - USAA

USAA is only available to certain facets of the population. If you have served in any division of the military, then you qualify. Or if you have a parent or child who has served, you can also qualify. Otherwise, this is not an option for you.

The upside is that their rates are usually pretty good since their target market is the military and their families. And, they just happen to offer a no down payment option to make the upfront cost less heady. 

There are a few restrictions, which are mostly related to location. The other exception is that the down payment would have to be less than $50 and doesn’t have any non-payment cancellations on record for the previous three years.

If you meet all of the qualifications they mention, then you are in line for a no down payment car insurance option through USAA. 

Learn more about USAA or read our full review.

Summary of the Best Insurance Companies with no Down Payment

Car insurance company How rates compare Can get a policy with no down payment automatically?
Allstate Highest in general, but lower for subpar credit No, you’ll have to speak to an agent
State Farm Lower for excellent credit, but higher for subpar credit No, you’ll have to speak to an agent
USAA Lowest Yes

Can I Get Auto Insurance with No Down Payment?

Yes, but almost definitely no. There are quite a few factors involved and not every company offers this option. First and foremost, there are only a few states that offer car insurance with no down payment.

Currently, the only states offering this option are: 

  • Arizona.
  • California.
  • Florida.
  • Georgia.
  • New York.
  • Oklahoma.
  • Washington.

So, if you don’t reside in one of these states, then you are out of luck. At least, for right now.

Secondly, you will have to resign yourself to one of the few companies that offer this option. And they may not have the best rates, so you might ultimately end up spending more.

Why do Insurance Companies Require a Down Payment?

All car insurance companies prefer, and in most cases require, a down payment to be made. This is to offset their upfront costs of running a background check and setting up a new policy.

These two things cost them money and they like to recoup it on the front end, as opposed to over the life of a six-month policy.

Why You Should Consider Making a Down Payment

Since car insurance with no down payment is hard to come by, there are some key factors to keep in mind.

A Downpayment Reduces Your Monthly Payments

The first thing to acknowledge is that your down payment isn’t just money that floats away in the wind. The down payment goes towards reducing your future monthly payments for car insurance. 

For example, if you put down 30% on a $100 monthly policy, you will reduce the amount you pay to $70 instead. So, putting a down payment on your car insurance may actually help you budget more effectively if you need to have that extra cushion monthly.

No Downpayment May Mean a Higher Rate

Also, since most car insurance companies prefer not to offer a no down payment option, you may get a higher rate to begin with. This is due to the fact that they consider you high risk. And with a high risk client comes a higher premium rate.

But, if you are willing to sign up for their direct deposit via your debit or credit card, you may have a higher chance of circumventing the required down payment. This may not be an advertised option, so you might have to get an agent on the phone to discuss this with them in order to get it executed.

There are Other Factors to Consider

The other thing to keep in mind is your credit score and the type of vehicle you are needing to insure. If you have a higher credit score and a slightly older car, you will be more likely to be able to obtain car insurance with no down payment. But, if you are trying to purchase a higher-end brand new car, the chances are much less likely. This is because higher-priced new cars are a much bigger liability for the insurance company. This is why they want some of your money upfront to help offset the risk.


Overall, finding a car insurance company that offers a no down payment option is akin to looking for a needle in a haystack. It is a very difficult task to undertake, especially since the information is not widely advertised.

If you are in the market for a car insurance policy and don’t want to pay a down payment, then there are a few options for you. 

Allstate and State Farm offer this option, but only in certain states and if you call and speak to an agent. They usually require a higher credit score also, since this is a higher risk investment on their end.

USAA is a great option if you have served in the military, or one of your family members has. They offer the no down payment option automatically. 

No matter which direction you choose to go with your car insurance, there are a plethora of options for everyone. Down payment or no down payment.

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