No one wants to overpay for auto insurance. Whether you’re in Denver or Colorado Springs, Durango, or Boulder, you want a good deal on things that are necessary and the things that are important to you, especially in a state known for mountains and snow.
Finding Cheap Car Insurance in Colorado
Having auto insurance is non-negotiable. Not only is it the law in the Centennial State, but it also saves you money later if involved in any type of accident or mishap. Plus, it can supplement your health insurance if you were to get injured. It’s definitely worth it to pay a little more now and save yourself a headache, additional funds, or even a lawsuit later on.
For CO residents, the average auto insurance rate for the state is essentially the same as the national annual average of $1,470 — only $5 less on average to be more specific. There are various factors that come into play when insurance companies decide upon their rates. These are based on research and statistics, driver demographics, and location, just to name a few.
In order to find the best cheap car insurance in Colorado, you must first know what insurance companies look for.
Use this table to jump to specific sections in this guide:
- What Insurance Rates Depend On
- Special Factors in Colorado that May Increase Your Rates
- Required Coverage in Colorado
- Largest Auto Insurance Providers in Colorado
- Cheapest Auto Insurance Providers in Colorado
- Discounts Offered by Companies in Colorado
- Price Difference from Company to Company
What Insurance Rates Depend On
The price you pay for insurance is dependent on several things. Some you may deem unfair, but believe it or not, there is adequate research involved in these deciding factors. Here is what providers will look for when determining rates.
- Age: According to research, the younger the driver, the riskier. The average cost difference between a teen driver and a driver in their 50’s is over $1,000 for a 6-month premium. The same goes for older drivers.
- Driving History: This factor is pretty common sense. If you receive multiple tickets and are accident-prone, you are a risk to insurance companies. They are going to charge you more upfront.
- Credit Score: According to the Federal Trade Commission, drivers with poor credit file more claims than those with good credit.
- Years of Driving Experience: To insurance companies, you are less risky the more driving experience you have.
- Location: Certain states require specific types of coverage, which can, in turn, affect the cost. Your zip code also plays a fairly important role in determining your premium. Bigger cities often are higher than in towns and rural areas. Where you physically park your car makes a difference as well. Parking in a single-home garage is less risky than parking in an actual parking garage, outside, or on the street.
- Gender: Statistics show that male drivers exhibit more risky driving behaviors than females. There usually isn’t too big of a jump for being a male, but this is still a factor.
- Insurance History: If you are fickle about which insurance company you want to stay with or are the type of insurer who often allows your policy to lapse, the next auto insurance company will most likely frown on your inconsistent behavior. They want someone who will pay on time and stick with them.
- Annual Mileage: The more miles you travel per year, the more you are on the road and at risk for something happening. Don’t worry though. The difference typically isn’t huge and varies state by state.
- Marital Status: Though the monetary difference actually isn’t significant you do get a little perk for being married.
- Claims History: This is a big one and should be fairly obvious. The more claims you file, the insurance company is going to view you in one of two ways: risky or suspicious.
- Coverage Level: Undoubtedly, the more coverage you have, the more money you pay.
- Additional Perks/Discounts Offered: Rates also depend on company-specific perks and discounts that they may offer. By asking the insurance company what they have, you could save quite a penny.
Now let’s look at the special factors in the state of CO that can either cost you more money or save you money.
Special Factors in Colorado that May Increase Your Rates
There are certain reasons why auto insurance in certain areas is cheaper than others. Unfortunately, living in certain areas of Colorado as opposed to others can hike up your bill.
Areas with a large population density, worsening traffic, and unfavorable weather conditions such as snow, ice, and hail, which are more prevalent in specific areas of Colorado, are all considered to be riskier, and in turn, cause increased insurance rates.
Required Coverage in Colorado
Every state has a specific minimum required auto insurance coverage that each driver must obtain. The minimum legal requirements for CO are as follows:
- $25,000 bodily injury per person
- $50,000 bodily injury per accident
- $15,000 for property damage
Colorado’s required coverage does not include Uninsured and Underinsured Motorist Coverage, as some states do. This helps in a case where the at-fault driver has no coverage or less coverage than you. These types of coverage are optional add-ons.
Each driver has the ability to increase their coverage based on their own individual needs. If you take out a loan to purchase your vehicle, your lender may require additional coverage.
If you are interested in adding coverage, these are some of the options available:
- Uninsured/Underinsured Motorist Coverage
- Medical Payments
- Rental Car Reimbursement
- Transportation Expense Coverage
- Towing and Labor Coverage
Largest Insurance Providers in Colorado
The five largest insurance providers in Colorado are State Farm, Farmers, American Family, Mid Century Insurance, Progressive Direct. By largest, they hold the most policies within the state.
But does larger mean cheaper? Some may say so, but let’s look at the facts.
Cheapest Auto Insurance Companies in Colorado
As of June 2019, the following are considered the top five most affordable insurance companies in Colorado: The Hartford, Grange, USAA, Nationwide, and Geico. You can compare these rates to those above and see that going with the more familiar or larger company won’t always save you money.
Discounts Offered by Companies in Colorado
- Geico: airbags, anti-lock brakes, anti-theft system, daytime running lights, good driver, seat belt use, defensive driving, driver’s education course, good student, emergency military deployment, federal employment, membership and employee, military, multi-vehicle, and multi-policy
- Nationwide: multi-policy, anti-theft, Smart Ride, safe driver, accident-free, good student, easy pay sign-up, defensive driving, paperless, and Affinity member
- USAA: safe driver, defensive driving, driver training, good student, multi-vehicle, vehicle storage, annual mileage, family discount, length of membership, and military discount
- Grange: defensive driving, accident-free, hybrid vehicle, pay in full, passive restraint, good student, and multiple policies
- The Hartford: anti-theft device, airbags, vehicle fuel type, driver training, good student, defensive driving course, multi-policy, and pay in full discount
Price Difference from Company to Company
Insurance rates can vary from company to company within the same state, even sometimes very dramatically. Here are a couple of reasons why:
- The cost of discounts: Certain companies offer more discounts than others. Some people are aware of these but many are not (unless they are told or they ask). It would be beneficial to compare a few companies and ask for a complete list of the discounts each offer. Be sure to update your demographic information if anything has changed (i.e. marital status, location) as well as any other circumstance that may get you a discount. Forgetting to do so can cost you in the long run.
- Choosing a company that uses credit scoring: This factor could either help or hurt your rate. If you have excellent credit, you will want to seek out an insurance company that includes credit scoring to determine the premium. However, if yours is subpar, then you may want to go elsewhere.
- Available perks: Everyone loves a good perk, but it may cost you to get them. Many auto insurance companies have “free” built-in options such as roadside assistance or bodily injury coverage for pets, yet you may technically be paying for this in your premium.
- Ability to combine policies to cut costs: Certain auto insurance companies offer homeowners or renters policies among other things. It is cheaper when you receive coverage for multiple things together than to separately cover them using different insurance companies or separate policies.
- Claim experiences and rate increases: If an auto insurance company is obtaining too many claims and are not charging enough premium, they will typically raise their overall rates to cover those costs.
There are several cheap car insurance options in Colorado for you to choose from. It is not advised to go with the first insurance company you research. Conduct more research and compare prices. Look at discounts. See what other factors may affect your individualized rate.
Once you put in some leg work upfront, you should be able to find a cheap and effective insurance policy that is just right for your needs. Be sure to check out our car insurance guides and resources for more information.
- 1 Finding Cheap Car Insurance in Colorado
- 2 What Insurance Rates Depend On
- 3 Special Factors in Colorado that May Increase Your Rates
- 4 Required Coverage in Colorado
- 5 Largest Insurance Providers in Colorado
- 6 Cheapest Auto Insurance Companies in Colorado
- 7 Discounts Offered by Companies in Colorado
- 8 Price Difference from Company to Company
- 9 Summary