Texas is the second state with the most cars in the United States and the highest speed limits in any jurisdiction, so any driver must have strong auto insurance coverage to protect themselves from any mishap. In this article, we will give you recommendations on how you can obtain the cheapest insurance for your car while also maintaining adequate protection. We will evaluate the different insurance companies that operate here and we will explain what are the peculiarities of the insurance market in Texas.
What is the cheapest car insurance in Texas?
The state of Texas establishes minimum requirements that all auto insurance policies must cover. Although we believe that the minimum coverage is very limited and we recommend all drivers to purchase additional coverage, the reality is that if you are in a compromised financial situation, you will find the cheapest insurance by limiting yourself to the minimum coverage. The minimum public liability coverage requirements in Texas are:
- Bodily injury limits: $ 30,000 per person and no more than $ 60,000 per accident
- Property damage limit: No more than $ 25,000 per accident
Taking the minimum coverage as an example, you may get auto insurance for $ 441 a year from the Texas Farm Bureau or $ 559 from Geico. These are representative premiums and your quote could be very different; If you are receiving much higher quotes, we recommend you try the following strategies to reduce your premium payment:
- Eliminate drivers under 25 from your policy – If you have minors in the house, consider restricting them from using your vehicle until you can afford to include them in the policy.
- Take a Defensive Driving Course – Some companies offer discounts if you choose to take a course to improve your skills on the road.
It is important to recognize and understand that a minimum coverage policy will not cover any repair costs you incur if you cause an accident. This minimum coverage only covers a small amount of civil liability or public liability, that is, the damage that your vehicle may cause to other people or property in the event of an accident.
What companies offer car insurance in Texas?
As Texas is one of the most populous states in the nation, it is also one of the states with the most options when choosing an insurance company to insure your car. The Texas Insurance Commissioner publishes a list of the top companies in the state according to the premium written in the previous year and the ten largest companies in 2019 were:
|Company||Percent of the Market||Premium Average Annual||Premium Average Monthly|
|State Farm||14%||$ 1,480||$ 123|
|Progressive||11%||$ 1,681||$ 140|
|Geico||9%||$ 2,114||$ 176|
|Allstate||8%||$ 1,684||$ 140|
|Farmers||7%||No information||No information|
|Liberty Mutual||5%||$ 3,097||$ 258|
|USAA||5%||$ 1,106||$ 92|
|Travelers||3%||$ 1,031||$ 86|
|Government Employees Insurance Company||2%||No information||No information|
|Old American County Mutual Fire Insurance Company||2%||No information||No information|
The premiums, or average monthly payment we include in the table are based on the average of all clients in the state. Your premium could be very different, depending mainly on your age, your accident history, driving record and your credit score. You may be surprised to know that having good credit can save you a lot on your policy. In Texas, the average savings for a good credit driver is over 40%, or more than $ 1,000 for a 6-month policy.
Some insurance companies focus on very specific niches, such as the car insurance company for state government employees. It is unlikely that you will find much information about these highly specialized companies on the internet, but if you qualify you should definitely contact them for a quote as they can often offer very competitive premiums.
What aspects of auto insurance are unique to the state of Texas?
Auto insurance is generally very similar in all states, but there are certain aspects of Texas that are a bit unique and have an impact on the state’s insurance industry. Here are the main factors:
- The risks of damage from natural disasters are high in Texas. Texas is in an area vulnerable to hurricanes and has an abundance of flood-prone areas. As if that were not enough, many parts of the state are also vulnerable to tornadoes. If you want to protect your car against these risks of natural disasters, you must make sure that your insurance policy includes comprehensive or full-cover coverage.
- Texas is a state with “a-fault” insurance laws. The counterpart of this law in other states is “no-fault” or “without fault”. What this means to you is that if you are in an accident caused by someone else, you cannot make a claim to your insurance company to pay for your costs – the damages have to be paid for by the policy of the person who caused the accident. In states that are “no fault”, you can make a claim to your insurance company even if someone else caused the accident. In that case, your company will pay you for the damages and then will recover the damages from the liable party. In practice, a lot of fraud ends up happening in states with “no-fault” insurance laws, so although at first glance it seems more convenient for the consumer to be in a “no-fault” state, the reality is that you end up paying higher premiums.
Where should I buy my auto insurance?
The main recommendation we always make is that you should compare quotes from various providers before deciding which company to insure your car with. Auto insurance is the furthest along of all consumer insurance products in terms of technological advancement and therefore are the easiest kind of insurance to quote quickly online. You can use a page like TheSimpleDollar to get quotes from various companies with no obligation. Remember to get at least one or two quotes from other insurance companies every year, as companies tend to change their rates every year. The company offering you the cheapest coverage today may not be the one offering it tomorrow.