Best car insurance companies in Texas
Fact-checked with HomeInsurance.com
Car insurance can be a substantial monthly cost, especially if you are paying more than necessary. It’s important to compare providers to find the best car insurance in Texas for the most affordable rate. Texas tends to run quite high for car insurance, with the state’s average at $1,974, compared to the national average of $1,555. In fact, Texas is in the top 10 most expensive states for full coverage auto insurance.
Best car insurance companies in Texas for 2020
- Geico: Best overall
- State Farm: Best for young drivers
- USAA: Best for military
- Allstate: Best for discounts
- Nationwide: Best for good drivers
|Company||J.D. Power claim satisfaction score/5||AM Best||Featured discounts offered||Average annual full coverage rate|
Driving history & habits
|State Farm||4/5||A++||Drive Safe & Save|
Multiple policy discount
Smart student discount
Driving record impact on Texas car insurance rates
A variety of factors contribute to Texas car insurance rates being higher than the national average:
- Uninsured motorists can drive up average costs. According to the Insurance Information Institute (III), the percentage of uninsured motorists in Texas sat at 14.1% in 2015 (the latest year data was made available).
- If a state has a higher expenditure rate for insurance, that can also affect rates. The III listed Texas’ average expenditure at $1,096.82 in 2017, putting the state 14th highest in the nation.
- Population density can also play a role, since more people are driving and increasing the risk of an accident. In Texas, 87.8% of the population lived in metropolitan areas in 2010, as reported by the National Association of Insurance Commissioners (NAIC).
|Clean record||1 speeding ticket||1 accident|
One interesting note about the chart above is that an accident and single speeding ticket each affect your rates the same — on average — in Texas.
While Texas has higher rates on average than other states, the good news is that accidents and tickets affect your rates less overall. For the lowest percentage increase from an accident, here’s how Texas compares to other states:
Full coverage: lowest percentage increase with accident
- Texas – 8% increase
- West Virginia – 10% increase
- Missouri – 12% increase
Minimum coverage: lowest percentage increase with accident
- Texas – 12% increase
- Washington: 19% increase
- Vermont – 20% increase
Full coverage: lowest percentage increase with ticket
- Texas – 8% increase
- Missouri – 9% increase
- Hawaii – 10% increase
Minimum coverage: lowest percentage increase with ticket
- Pennsylvania – 10% increase
- Texas – 12% increase
- Iowa – 14%
Geico: Best overall
We chose Geico as the top provider of car insurance in Texas because it has both a wide variety of discounts and great ratings through AM Best and J.D. Power. Its 4-out-of-5 standing with J.D. Power puts it in the “better than most” category, and makes it one of the best car insurance companies in Texas. It also has the highest rating you can get from AM Best — A++, which is a reflection of superior financial strength. And for all that, the rates are even the lowest among providers in Texas.
State Farm: Best for young drivers
State Farm is a standout provider for drivers with good records, which is great for young drivers who can take advantage of the discounts and savings offered by the company. Young drivers are often subjected to the highest rates, so discounts are important, particularly with Texas drivers. Drivers under 25 years of age, or new drivers without at-fault accidents or moving violations in the past three years, could be eligible for the Steer Clear discount. Like Geico, State Farm also boasts the highest AM Best rating, and a 4 out of 5, “better than most” ranking from J.D. Power.
USAA: Best for military
We listed USAA third on the list, despite stellar J.D. Power and AM Best ratings, only because eligibility is limited to certain Texas drivers. This is because the company serves military personnel and their families, making it more of a specialty insurer.
Allstate : Best for discounts
Allstate’s claim satisfaction ratings and A+ AM Best rating put it a bit lower on the list, although it is still a well-known and respected provider. It does have the highest rates on the list, which affected Allstate’s rank in our overall selection of the best Texas auto insurance providers. But to help compensate for these rates, Allstate offers a multitude of discounts.
Nationwide: Best for good drivers
Nationwide has lower claims satisfaction ratings from J.D. Power compared to other providers in Texas, but like Geico, competitive rates and a multitude of discounts available landed it a spot among our top providers. In particular, Nationwide offers a variety of discounts that specifically cater to driving behavior, including SmartMiles, SmartRide, accident-free, and safe driver.
Car insurance in Texas by city
To determine “how much is car insurance in Texas,” it’s important to look at rates by cities. Rates can vary by as much as a few hundred dollars depending on the metropolitan area. The chart below compares rates across different major cities in Texas to illustrate this variance.
|City||Full coverage annual rate||Minimum coverage annual rate|
Houston is $602 above the national average for full annual coverage. Being the most populated major metropolitan hub of the state, the higher rate is to be expected. It’s important to comparison-shop to find the cheapest car insurance in Houston, Texas.
San Antonio sits at $395 above the national average in full coverage. San Antonio is the second most populated city in Texas, right between Houston and Dallas. However, it has a mid-range population density compared to the other four cities, which is reflected in the slightly lower rates.
Dallas is at $603 above the national average for full coverage, topping the list for most expensive cities for insurance in Texas. City size and population density are significant factors in this city.
Austin comes in at just $272 above the full coverage national average. Austin has a lower population density, so it’s the least expensive of the listed cities.
With the lowest population density of the five cities, it’s not surprising rates are second-lowest. Fort Worth is $340 above the national average for full auto insurance coverage. However, its proximity to Dallas may be a factor in why rates are slightly higher than Austin.
Texas car insurance considerations
Other factors that affect car insurance rates include weather and natural disasters — in Texas, especially.
Being located adjacent to the gulf coast, Texas continues to get hammered with increasing hurricanes and tropical storms that can drive up rates. Severe weather leading to higher claims can have a substantial impact on rates overall compared to other states.
Texas minimum liability requirements
Texas does require drivers to carry a minimum amount of liability insurance. These state minimums are listed as 30/60/25, which indicates the following is required for all drivers:
- $30,000 bodily injury liability per person
- $60,000 bodily injury liability per accident
- $25,000 property damage liability per accident
Auto insurance alternatives in Texas
Drivers can also get insurance through the Texas Automobile Insurance Plan Association (TAIPA). However, it’s important to note that you can only buy the minimum liability of 30/60/25 through the association; collision and comprehensive coverages are not available. The purpose of the association is to help people with a higher risk profile obtain insurance to meet minimum requirements in Texas, which can be difficult to do with other providers.
How we chose the best car insurance providers in Texas
In order to find the best car insurance in Texas, we compared the major providers by rates and ratings, as well as availability to Texas drivers. We assessed ratings through AM Best and J.D. Power, and took into consideration average full coverage and minimum rates — comparing those with the state average. Discounts available was another key factor in ranking our best car insurance providers in Texas.
Other car insurance providers in Texas to consider
In addition to our top providers, here are a few additional providers worth including in your comparison-shopping to find the best car insurance in Texas:
Fred Loya’s average annual full coverage premium comes in at $3,251, with minimum coverage averaging $570. It was not ranked by the J.D. Power study due to sample size, but is worth including in your comparisons, as actual quotes from providers may vary from the data in this review.
Sentry runs $3,237 on average for full coverage, $1,098 for minimum coverage annually. This company was not also not included in the J.D. Power, but may be worth looking into if the provider could potentially offer you more competitive rates.
Coverage Utilizes Quadrant Information Services to analyze quoted rates from thousands of zip codes across all 50 states, using the top 15 carriers by premiums written by state. Quoted rates are based around the profiles of a 30 year male and female with a clean driving records, good credit and the following full coverage details:
- $100k bodily injury liability per person
- $300k bodily injury liability coverage per crash
- $100k property damage liability coverage per crash
- $500 collision coverage deductible
- $500 comprehensive coverage deductible
Minimum coverages were applied to match state requirements. Both drivers used a new, financed 2018 Toyota Camry, commuting 5 days a week and driving 12,000 miles per year.