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Shopping for the best car insurance is a bit like buying a car. You’ve got to set your budget, research all options, balance your wants and needs, and make a choice that protects you and your family. That’s a lot to think about, but it doesn’t have to be an unpleasant process. Read on to learn more about Texas’ car insurance laws and how to find the lowest auto insurance rates in Texas.

Average Annual Car Insurance Rates in Texas

Company Average Rate
USAA $2,487.89
State Farm $2,879.94
Geico $3,263.27
Nationwide $3,867.55
Progressive $4,664.69
American Family $4,848.71
Allstate $5,485.43

 

How We Found the Cheapest Car Insurance in Texas

U.S. News also worked with Quadrant Information Services to provide a report of average insurance rates in all 50 states from the 10 largest national car insurance companies. The rates are based on profiles for both male and female drivers aged 17, 25, 35, and 60. Vehicles used include the 2018 Honda Civic, 2018 Toyota RAV4, 2018 Ford-F-150, 2015 Honda Civic, 2015 Toyota RAV4, and 2015 Ford-F-150, with annual mileage of 6,000 and 12,000. Three car insurance coverage levels were used, as were credit tiers of good, fair, and poor. Clean driving records and records with one accident, one speeding violation, and one DUI were also used in the calculations. The rates shown here are for comparative purposes only. Individual rates will differ.

How Much Does Car Insurance Cost in Texas?

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On average, Texans pay about $3,900 in car insurance each year. Your rates will vary based on several factors, including your driving record, your age, your marital status, other drivers in your household, the coverage you choose to buy, and more. One of the biggest factors is where you live.

The highest car insurance rates in Texas are found in populated urban areas. The average rate in Houston is about $4,800 a year, while the average in Dallas is around $4,700. The rates remain high in suburbs of these areas like Pasadena ($4,500) and Garland ($4,400). By comparison, the cheapest car insurance rates are found in rural areas and smaller cities like Austin ($3,900) and El Paso ($3,700).

City Average Rate
Houston $4,770.73
San Antonio $4,118.50
Dallas $4,682.06
Austin $3,875.30
Fort Worth $3,931.13
El Paso $3,724.98
Arlington $4,148.36
Corpus Christi $4,018.27
Plano $3,956.90
Laredo $4,431.83
Lubbock $3,935.36
Garland $4,435.29
Irving $4,373.16
Amarillo $4,294.73
Grand Prairie $4,384.70
Brownsville $4,207.63
McKinney $3,865.75
Frisco $3,834.52
Pasadena $4,453.27
Mesquite $4,420.15

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Texas Auto Insurance Minimum Coverage Requirements

Drivers in Texas are required to be financially responsible for the car accidents they cause. Most drivers fulfill this obligation by purchasing auto liability insurance. Liability Insurance compensates the other parties affected by an accident for their bodily injury and property damage if you – or someone driving your car with your permission – are at fault. A minimum coverage limit of $30,000 is required by Texas law for the injury of one person, a limit of $60,000 is required for the injury of two or more people, and a limit of $25,000 is required for car and property damage. This is commonly referred to as the 30/60/25 ratio.

It’s a good idea to purchase more liability coverage than these minimum requirements. The high costs of car repair and medical care can quickly deplete the minimum coverage. If those affected by the accident still have outstanding costs, they can take you to court to pay these remaining bills. That would be in addition to your own medical bills and repair costs, which liability insurance doesn’t cover.

We also recommend considering some of the optional insurance coverages that are available. Medical Payments coverage pays for your and your passengers’ medical bills, regardless of who is at fault in an accident. Personal Injury Protection (PIP) covers your and your passengers’ medical bills and lost wages, regardless of fault. Uninsured Motorist insurance pays for your and your passengers’ medical bills, lost wages, and property damage if the driver at fault in an accident does not have insurance. This coverage also applies if they don’t have sufficient liability insurance or in the event of a hit-and-run accident. In Texas, auto insurers must offer you Personal Injury Protection and Uninsured Motorist coverage to comply with state law, but you can refuse these coverages in writing if you do not want to buy them.

Collision and omprehensive coverage are worth considering as well; they’re typically required under contract when leasing or financing a vehicle. Collision insurance pays for the damage done to your vehicle in an accident. Comprehensive insurance pays for damage to your vehicle as the result of things such as vandalism, theft, fire, hail, or flood.

Cheapest Car Insurance in Texas

USAA offers the lowest car insurance rates in Texas, according to our research. The annual cost of the surveyed USAA policies beat the state average by about $1,400. USAA also offers the best rates for teenage drivers, which is often the priciest age group to insure. The average 17-year-old male insured with USAA pays about $4,800 a year, while the average 17-year-old female pays $4,400.

Company Single 17-year old female Single 17-year old male Single 25-year old female Single 25-year old male Married 35-year old female Married 35-year old male Married 60-year old female Married 60-year old male
Allstate $9,359.76 $11,309.41 $4,410.26 $4,599.90 $3,564.74 $3,599.24 $3,520.09 $3,520.09
American Family (as The Gen Automobile Ins Co Inc) $7,712.20 $10,115.61 $4,191.19 $4,781.85 $2,918.23 $3,248.96 $2,712.47 $3,109.21
GEICO $5,297.88 $5,501.97 $2,632.31 $2,627.77 $2,433.67 $2,622.66 $2,340.36 $2,649.60
Nationwide $6,856.60 $8,817.81 $2,851.86 $3,088.47 $2,430.54 $2,473.87 $2,146.14 $2,275.08
Progressive $10,405.83 $11,606.62 $2,956.88 $2,997.98 $2,496.21 $2,372.22 $2,218.99 $2,262.78
State Farm $4,814.70 $6,130.77 $2,195.21 $2,262.69 $2,020.69 $2,020.69 $1,797.38 $1,797.38
USAA $4,422.95 $4,826.62 $2,125.43 $2,286.37 $1,594.69 $1,607.92 $1,522.52 $1,516.65

These USAA policies are typically cheaper regardless of driving record, annual mileage driven, coverage type, and credit score. On average, drivers with a clean record pay around $1,900 a year with USAA. Drivers with one accident pay around $2,700 per year, and drivers with one speeding violation pay about $2,100. 

Company Clean record With 1 speeding violation With 1 accident With 1 DUI
Allstate $4,270.64 $4,270.64 $6,562.40 $6,838.06
American Family (as The Gen Automobile Ins Co Inc) $4,418.43 $4,418.43 $5,627.11 $4,930.89
GEICO $2,769.51 $3,570.43 $3,651.30 $3,061.87
Nationwide $3,351.97 $3,789.09 $3,351.97 $4,977.17
Progressive $4,066.61 $4,581.14 $5,258.16 $4,752.85
State Farm $2,561.33 $2,561.33 $2,934.62 $3,462.46
USAA $1,857.94 $2,132.76 $2,737.15 $3,223.73

The only downside of USAA’s low rates is that you need to be a member of the military, be a military veteran, or have a family member who is a veteran or in the military to get insurance through USAA. State Farm and Geico offer the next best rates, according to our analysis, and they are open to all Texas residents. The annual cost of these plans beats the state average by about $1,000 and $700, respectively. Drivers insured with Allstate had the highest rates. Allstate plans cost around $1,600 more than the state average.

Why Car Insurance Rates Vary in Texas

Your neighborhood has a big impact on how much you pay for car insurance. Insurance companies look at an area’s population and traffic before offering rates. The cost of auto repair and medical services are also considered, as well as the crime rate and the number of insurance claims in that area. That’s why drivers in large cities with heavy traffic typically pay more for car insurance than drivers in smaller cities and rural areas with less congestion.

How to Get the Cheapest Car Insurance in Texas

Insurers offer the best rates to drivers with a spotless driving record and few or no insurance claims. If that doesn’t sound like you – don’t worry, there are many discounts available, as well as other ways to lower your rates. Companies often provide discounts based on the safety features of the insured car. You can often get discounts for having daytime running lights, anti-lock brakes, air bags, and anti-theft devices like a car alarm.

Many insurers also extend discounts to teenagers who have taken a driver education course, and some offer discounts for students with good grades. If you insure multiple vehicles with the same insurance company, you may qualify for a multi-car discount. Homeowners who bundle their home and auto policies can often receive a multipolicy discount as well.

Usage-based insurance is a relatively new way for insurers to gauge driving risk. Drivers can use apps and GPS devices to record their driving habits and share this data with the insurance company. Examples of this include Allstate’s Drivewise program and Progressive’s Snapshot program. In general, users who drive less and exhibit safe habits are rewarded with lower insurance rates. High-speed driving, frequent panic stops, and high annual mileage can lead to higher premiums.

Adjusting or eliminating coverage is another simple way to lower your car insurance rates. For instance, if you own an older vehicle with a value of $2,000 or $3,000, it may not make sense to pay hundreds of dollars a year in collision and comprehensive coverage to repair that car in the event of a claim. That money could be better spent on vehicle maintenance or saved to pay for a newer car. Of course, you should be careful about which coverages you adjust. It’s always a good idea to keep high liability coverage to compensate others if you’re at fault in an accident, and to protect your assets if you’re taken to court.

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Important Laws Around Auto Insurance in Texas

Any car insurance bought in Texas should cover you no matter where you drive in the United States and Canada, but it won’t cover you in Mexico. That’s because Mexico has different liability insurance laws and only accepts policies written by insurance companies based in Mexico. Some U.S. insurers offer waivers for your policy that cover vehicle theft or damage in Mexico, but these do not include liability coverage. If you plan to drive in Mexico, you should purchase Mexican liability insurance from a licensed agent. Policies vary in length from a year to just a few days, and additional coverages can include legal and medical costs.

If you’ve been denied car insurance by at least two companies, the Texas Automobile Insurance Plan Association (TAIPA) is a government tool that can help you find coverage. TAIPA assigns applicants to an insurance company and provides these drivers with the minimum limits of personal injury protection, uninsured motorist, and liability coverage. The program is designed to help those with a poor driving record or multiple insurance claims. These assigned policies tend to be pricier than those offered in the voluntary insurance market, though.

Texas Driving Laws and Punishments

It is illegal to operate a vehicle on Texas public roads if you do not have basic liability insurance coverage or another accepted form of financial responsibility. The fines for driving without insurance range from $350 to $1,000. You also risk having your car impounded and your license and registration suspended.

Seat belt usage is mandatory for all drivers and passengers in Texas. The fines for violating this Click It or Ticket law vary between $200 and $250. You can also be fined between $99 and $200 for driving while texting or emailing with a cell phone. Some cities have stricter distracted driving laws that prohibit all handheld cellphone usage while driving, but holding your mobile phone in your hand while talking on it is still legal at a state level.

There are several laws in Texas that address driving under the influence of drugs and alcohol. The Zero Tolerance law states that no one under the age of 21 can operate a vehicle with any detectable amount of alcohol in their body. Drivers who violate this law can have their licenses suspended for between 60 and 180 days. They can also face fines ranging from $500 to $2,000, depending on the number of offenses.

Operating a vehicle with a blood alcohol content of .08 percent or higher is in violation of the Driving While Intoxicated law (DWI). Depending on the number of offenses, drivers convicted of DWI can face fines of $2,000 to $10,000, a license suspension of up to two years, and jail time. The penalties are more severe if there are children in the vehicle or if someone is injured or killed in an accident caused by DWI.

Texas Car Insurance FAQs

Is car insurance required in Texas?

Yes, car insurance is required in Texas, and you must show proof of insurance to register a car in Texas. Texas law states that drivers must be financially responsible for the injuries and damages they cause to others if they are at fault in a car accident. Car insurance is the recommended and most common way drivers meet this requirement. Less common alternatives include cash deposits and surety bonds.

Which cars are required to be insured in Texas?

Driving and Talking
Jacobs Stock Photography Ltd / Getty Images

Drivers must insure all vehicles – cars, trucks, SUVs, and motorcycles – that are driven on Texas public roads, or demonstrate another accepted form of financial responsibility. Vehicles that are inoperable or in storage do not need to be insured, but they must be reinsured before returning to use.

If you’re a nonresident of Texas, such as a college student or an active member of the military, with a vehicle registered in another state, you must follow the car insurance and registration laws of that state. If you become a resident, you must insure and register the vehicle in Texas within 30 days.

When should I get car insurance in Texas?

You’ll need proof of insurance before you can register any vehicle in Texas. If you’re buying a new or used car, you can purchase insurance beforehand by shopping online, over the phone, or in person with an agent or broker. You can also get insurance right at a car dealership.

If you have existing insurance on other vehicles, the insurer must automatically cover any additional cars purchased with the maximum amount of coverage provided under your policies. If you’re trading in a car, the replacement vehicle will receive the same amount of coverage as that car. You must notify your insurer within 20 days of any vehicle purchase. Otherwise, you risk losing coverage.

What happens if my car is not properly insured in Texas?

You can be fined between $350 and $1,000 for driving in Texas without insurance or another accepted form of financial responsibility. You can also have your driver’s license suspended for two years and have your vehicle towed. Police officers can monitor insurance coverage for vehicles registered in Texas using TexasSure, an online database.

Is Texas a no-fault state?

Texas is not a no-fault state. That means that the state will assign fault for any accident. The driver who is found to be at fault for an accident will have claims made on their insurance to cover damage and injuries to other parties and property involved in the accident. Texas is referred to as an “add-on” state for car insurance. Personal Injury Protection (often called no-fault insurance) can be added to your policy to pay for your and your passengers’ lost wages and medical costs, but it is not legally required. This coverage pays no matter who is at fault.

Do I need uninsured motorist coverage in Texas?

Insurers are required by Texas state law to offer you uninsured motorist insurance, but you are allowed to decline this coverage. Uninsured motorist insurance covers your or your passengers’ medical bills, lost wages, and property damage if the driver at fault in an accident does not have insurance. It also applies if the driver has insufficient liability insurance or in the event of a hit-and-run accident.

Is liability insurance required in Texas?

No, but it is highly recommended. In Texas, drivers are financially responsible for the injury and property damage they have caused to others if they are at fault in an accident. Purchasing liability insurance is the most common way for drivers to fulfill this obligation. Less common alternatives include a surety bond with the same required coverage amounts as liability insurance, depositing $55,000 with a county judge or the state comptroller, or self-insurance (permitted only if you own more than 25 registered vehicles).

Does Texas accept digital insurance cards?

Yes, but check with your insurer to see if they provide this form of insurance card. Digital insurance cards can be displayed on portable electronic devices like a smartphone.

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