In most states, a low credit score quietly inflates your premium — poor-credit drivers pay around $175/month on average, roughly 30% more than those with excellent credit. The cheapest options are Country Financial, NJM and USAA (all limited in reach), with GEICO and State Farm the cheapest widely-available insurers. You can’t fix this overnight, but shopping credit-friendly insurers and improving your score both work — and in four states, credit can’t be used against you at all.
Cheapest for bad credit
| Company | Avg. monthly (poor credit) | Note |
|---|---|---|
| Country Financial | ~$56 | 19 states |
| NJM | ~$59 | Regional (NE US) |
| USAA | ~$66 | Military only |
| Auto-Owners | ~$87 | Through local agents |
| GEICO | ~$89 | Widely available |
| State Farm | ~$92 | Largest agent network |
Source: Compare.com, 2026 average rates for drivers with poor credit. Varies by state and coverage.
How much is bad credit really costing you?
More than most people realize. On average, going from excellent to poor credit adds about $40 a month — roughly $480 a year — for the exact same driver and car. In some states the gap is even wider. It feels unfair because your credit says nothing about how you drive, but insurers argue it statistically predicts claims, so most states let them use it.
The four states where credit doesn’t count
Here’s the part that changes everything depending on where you live: California, Hawaii, Massachusetts and Michigan ban or heavily restrict the use of credit in car insurance pricing. If you live in one of those, a low score won’t raise your rate at all — so this whole issue may not apply to you. Everywhere else, credit is usually one of the bigger factors, and it’s worth treating as something you can improve.
A real example
Say your credit score is around 580 and you’re quoted about $175 a month. You spend the next year doing the boring stuff — paying every bill on time, knocking down your card balances — and your score climbs to “good,” around 680. You re-quote, and the same policy now comes back closer to $135 a month. That’s roughly $480 back in your pocket each year, on top of every other benefit better credit brings. It’s the rare insurance move where patience literally pays.
How to pay less
Right now
- Quote credit-friendly insurers (GEICO, State Farm)
- Add a regional one (Country Financial, NJM, Auto-Owners)
- Ask about usage-based / telematics discounts
- Bundle renters or home with auto
Over time
- Pay every bill on time and lower card balances
- Re-quote at each renewal as your score climbs
- Raise your deductible if you can cover it
- Check whether your state bans credit-based pricing
The bottom line
Quote GEICO and State Farm first (plus Country Financial, NJM or USAA if you’re eligible), and keep nudging your credit up — the rate falls as the score climbs. And if you also have a ticket or accident on record, our guides on car insurance after a DUI and SR-22 insurance cover those situations too.
Here’s the part that genuinely annoys me: your credit score has nothing to do with how you drive, yet it can swing your premium by hundreds a year. It’s legal in most states, so there’s no point fighting it — but there is a smart way to play it.
If this is me, I do two things at once. I shop the credit-friendlier insurers today — GEICO and State Farm are the easy national starting points, Country Financial or NJM if they’re in my area — and I quietly work my score up over the next year, then re-quote. And I’d check my own state first, because in California, Hawaii, Massachusetts and Michigan this whole problem simply doesn’t exist.
FAQs
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How much more do bad-credit drivers pay?
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Sources: Compare.com (2026 rates for drivers with poor credit).