A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products, including home, life, auto, and commercial, and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, mainly in the insuranc...

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Reviewed by Leslie Kasperowicz
Farmers Insurance CSR 4 Years

UPDATED: Oct 19, 2021

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Here's what you need to know...

  • Car insurance is a requirement in every state but two
  • Expenses for not having adequate auto insurance can far outweigh premium expenses
  • Make your car insurance a priority to save money in the long-run

When shopping for car insurance, one of the challenges is in finding affordable premiums that you can pay each month.

When money gets tight, some people drop their insurance coverage as a way to save money. Read this article to learn more about penalties for not carrying insurance and what you can do to find coverage even with a tight budget.

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Insurance is a Priority

Car insurance protects you from having to pay out-of-pocket expenses for accidents or injuries that you cause in a car accident.

Additionally, it protects you from lawsuits from other parties who might sue you for negligence or wrongful death. It is also a state requirement to carry insurance while driving in every state except New Hampshire and Virginia.

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State Minimums

Every state that requires insurance has specific requirements for liability, personal injury, and property damage that you must meet to be in compliance with state insurance regulations.

Some is Better than None

When planning your budget, remember that you are required to carry at least the minimum amount of auto insurance according to the state minimums in your state of residence.

You should consider how much you drive each day and the risk involved in not carrying insurance for your vehicle. Remember, it could cost you far more money in the long run if you fail to have auto insurance than it would to pay car insurance premiums every month.

Advantages of Having Good Car Insurance

There are many advantages of carrying car insurance other than the fact that it is a state law. Here are some of the reasons you should carry car insurance.

  • Auto insurance protects you from lawsuits from other people who you might inadvertently injure in an accident.
  • Car insurance protects you from medical expenses that you might encounter for your injuries or the injuries of someone else.
  • Car insurance gives you peace of mind when traveling.
  • It gives you extra help on the road such as roadside assistance plans.
  • It protects the other passengers in your car by providing financial help for their injuries that you do not have to pay yourself.

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The Best Solution for Low-Budget Insurance

If you do not think you can afford insurance consider this: you cannot afford not to have insurance.

The excessive amounts of expenses that you may owe due to lawsuits, attorneys fees, and court fees are far more costly to you in the long run than any immediate expense you’ll pay in premiums. Sometimes expense should not be measured in the short-term, but in the long-term.

Even if you were to get by without insurance for several months, the day you have an accident is the day you could automatically be out thousands of dollars to pay for damages to another person’s car.

The best thing you can do is to shop around and compare car insurance rates. Ask questions and find out if you are eligible for discounts. There are several categories of discounts you might qualify for including:

  • Good student discounts – If you have excellent grades and are enrolled in an accredited institution, you may qualify for a good student discount. There is research that supports the idea that good students make better drivers. Insurance companies sometimes base their rates on these statistics. So, if you are a good student, ask your insurer if you qualify for this discount on your insurance premiums.
  • Military discounts – If you are in the military or have been in the military before, you may qualify for this type of discount. Veterans and their spouses may be eligible for reduced rates, depending on the policies of the company. Ask your online agent to see if you qualify for this if you are a member of the military or are retired from the military.
  • Safe driving discounts – Since the biggest factor influencing your insurance premiums is your driving record, you may also qualify for a reduced premium based on your good driving record. Shop and compare policies when shopping for insurance online and ask if you can get a reduced rate due to this factor. You can get a copy of your driving record at your local DMV office.
  • Government employee discount – Some insurance companies also offer discounts for being in a government employee position. Only the insurance company can verify whether your particular position will qualify for a discount on your premiums. But it never hurts to ask. Government positions can include anything from civil service work, teaching for a public school in your state of residence, and other public service positions.

Plan Your Budget

One of the best things you can do to ensure that you can afford car insurance is to plan your budget well.

Planning is important, and you should always consider your auto insurance a top priority. When planning your budget, break up your expenses into categories and make sure that you allow enough money to cover all of the basic expenses first, including insurance.

If you have had accidents, DUIs, or other infractions and your insurance is too high, you may be eligible for indemnity insurance. Ask an agent to look into this for you.

By working on your budget and prioritizing car insurance, there is no reason you cannot afford car insurance. The simple truth is, if you cannot afford car insurance, then you cannot afford to drive.

Enter your zip code into our FREE tool below to find car insurance rates that fit your budget!


  1. http://carinsurance.about.com/od/PolicyFundamentals/a/Do-I-Need-Car-Insurance.htm
  2. https://www.iii.org/article/background-on-compulsory-auto-uninsured-motorists
  3. https://content.naic.org/state-insurance-departments
  4. http://www.investopedia.com/terms/i/indemnity.asp?ad=dirN&qo=serpSearchTopBox&qsrc=998&o=40186