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Car Insurance for Low-Income

The lowdown...
  • Car insurance is required regardless of your income
  • Low-income drivers may qualify for helpful discounts
  • Shop and compare to find the best deal and work on managing your finances to feel more secure about the future

Car insurance is necessary for everyone to protect themselves for the unknown quantities of life.

It’s the state law in every state except for two: New Hampshire and Virginia.

Even in those two states that don’t require insurance, they have a stipulation that requires drivers to prove their fiduciary responsibility instead of real insurance to illustrate their ability to pay for damages or injuries to others in the event of an accident.

If you are in need of more affordable auto insurance, start comparison shopping today by entering your ZIP code above!

How Insurance Came About

The first insurance came about with the help of Benjamin Franklin and others who decided that there must be a way to share the risk across a large number of people so that everyone could be covered when their time came.

Things have changed a lot in the insurance industry since that time, but the basic idea is still the same. You get insurance to have funds to take care of a rainy day.

The State of Low-Income People

Everyone struggles financially from time-to-time, except perhaps the most wealthy people. But even they have concerns that the money may not be there in the future. That concern is why wealthy people keep a large reserve, an emergency cash flow of funds to save the day when they need it most.

Remember that it’s better to save for something that never happens rather than to spend what you don’t have now.

To individuals in the low-income bracket, they cannot afford such luxuries as a reserve or significant savings fund. So they are living from paycheck to paycheck and hoping for sunny days.

The problem with low-income people is that they are the ones who need insurance the most, but often they are the ones who can least afford it.

There are some things you can do, however, to allow for required auto insurance even if you are in the low-income bracket. In fact, you must do so to be secure at all from life’s unexpected happenings.

Who is in the lower income bracket?


The lower income bracket (as far as income taxes go) is considered anywhere from around $23,000 to $49,000, depending on the number of people in the household.

There is a chart that shows the lower income bracket for single or people with children. You can click on your state to see what your state income bracket is.

You should not feel bad if you do fall within the lower income. You may be working more than one job trying to get by. You may be between jobs or have several kids to take care of.

Whatever the case, you should just be aware of the challenges and budget according to your priorities. But, to be on the safe side, one of those priorities should be to have auto insurance.

For someone in the lower income brackets, it would be a complete financial disaster to have to pay out-of-pocket for an accident if you were ruled at fault in one.

Another issue is that, if you live in a no-fault state, you may have to pay for damages even at times when you were not at fault. In states such as Florida, for example, you will have to pay for your damages or injuries if you are ever injured in a collision.

Having to pay for damages or injuries can create a financial hardship on an already struggling family who falls into the lower income bracket. So what should you do to be able to afford insurance?

How to Plan for Insurance Premium Payments


One of the things you should do if you are struggling with your finances is to plan your budget to include it.

Insurance is not an option; it’s a requirement. The only exceptions are if you happen to live in one of the only two states that do not require it.

When you plan your budget, make your auto insurance (as well as health and life) a priority. Plan your budget to include these essential expenses so that you will be covered in the event of an unforeseen disaster.

Tips to Planning for Insurance Payments


Do you need some helpful tips to help you plan to find the best insurance rates? You should compare the essential aspects of your insurance plan to find the best prices.

Below are some tips that should help you to decide which coverage and plans are best for you.

– Shop Around to Get the Best Premium Rates

The more you shop and compare insurance costs, the more you will find a deal that will suit your budget.

Don’t be ashamed to tell the insurance agents who give you a quote that you are in the lower income bracket and that you may have trouble paying your premiums.

The basic idea of all insurance is that some insurance is better than none. Once the agent knows your situation, he or she will steer you to the most affordable plan that you can afford so that you will be able to pay the bill each month.

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– Save Money Each Month for Unexpected Expenses

Even if you can only save a small amount each month, that small amount that you put away may add up to enough to give yourself a little extra money if you need it. But the main thing is to pay your insurance premiums.

You cannot afford the risk of having to pay for an accident or lawsuit out of your account. It would be financially devastating.

– Look for Discounts

Insurance discounts may help you to meet your expenses for your insurance premiums. You may be surprised what you may be eligible for.

Some of the discounts are listed in the section below.

Common Insurance Discounts


If you’re not sure whether you qualify for an insurance discount or not, ask your representative to look into it for you.

Some of the most popular discounts are:

    • Good student discount – The good student discount is a discount that any good student will qualify for if it is offered by your insurance provider. Offering a good student discount is up to the individual companies, which is why you need to shop around to get the best rates.
    • Defensive driver discount – You may qualify for a defensive driver discount if you go through any certified defensive driver course that shows you are a careful driver. This discount will vary from state-to-state and will be determined by the individual insurance providers.
    • Good driver discount – If you keep your driving record free from traffic violations or accidents, you will probably qualify for a good driving discount. Again, this is decided by the insurance company so check to see if your policy has this option when you shop.
    • Low mileage discount – A low mileage discount allows you to take a discount on your premiums if you live close to work or drive only short distances. Ask your agent to explain how this works if your insurer offers this discount.
    • Multiple car discounts – If you have more than one vehicle that you put on your insurance policy, you may want to find a company that offers this type of discount.

Another type of discount that you may find with some companies is an automatic payment discount. Many insurance companies will take some amount off of your premium for paying early, annually, or by automatic withdrawal.

Setting up an automatic payment plan increases your trustworthiness. So an insurance company is more likely to trust you when you agree to pay this way.

Many companies also offer you a way to get your car insurance started earlier when you opt for an automatic payment plan.

Work on Your Credit Rating


Even people with a low income are sometimes working their way out of debt. Debt could even be the reason you are struggling at times.

good credit rating could work in your favor even if you fall in the low-income bracket.

Paying back your creditors will eventually get noted by the credit reporting agencies such as Transunion and others.

Anytime you pay off a debt that you previously owed, you will get points on the positive side noted in your credit record. With time, a positive mark will appear on your credit report.

Insurance agencies all have access to a credit report when you sign up for services or agree to have your credit checked under the Fair Credit Reporting Act. Accessibility to your credit report may work in your favor when you are shopping for insurance.

If the insurance company does not already have a copy of your credit report, you may want to volunteer to get them one, if it is good. Offering your credit report will present them with more proof that you are trustworthy, and they might give you a break due to your attempt to correct your old debt or delinquencies.

Plan for the Worst


We can control many things. But we still do not know what lies ahead. Therefore, we must make insurance a top priority, no matter what our income level is at any time.

If you need help meeting your financial obligations, there are credit counselors and others who may be able to advise you on better ways to manage the money you have.

Another positive action you could take is to work on improving a skill that you have that is capable of making you more money. When you increase your income and lower your debt, your expenses will become easier to manage.

The bottom line is that you can’t afford to go without auto insurance. The legal fees alone in some states and unbearable ($300-$2,000 on a first offense) and others even take away your driver’s license if you are caught even once driving without proof of insurance.

Keep Looking Up


The human condition is one of continual improvement, no matter what situation we are currently in. We should always strive to be better than we were before.

Taking control of our finances and making sure the essential expenses are taken care of are two of the most important things we can do to achieve this.

When you shop and compare policies, talk to the insurance agents and compare what they have available. Tell them your financial situation. They are sworn to keep this confidential.

Insurance agents can help you find the right insurance policy that will save you money while covering the relevant mandatory requirements for car insurance.

Remember that, when you plan for the unexpected, you will always have enough.

But if you fail to have a plan, then life will plan for you. You don’t want to take this risk when it comes to your safety and financial security and that of your children and family.

Shop around and compare policies until the find the one that works best for you. Remember that some insurance is better than none. So get the state minimums at first. Then add on as you can afford to do so.

If you drive safely and obey all traffic rules, pay your bills on time, and follow the law, you will find that despite that rainy day, the sun will eventually shine again.

Start comparison shopping today for better auto insurance rates! Enter your ZIP code below!

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