In most states, credit is one of several factors insurers use to price an auto policy, and the published gap is wide. Drivers with poor credit average about $3,936 per year for full coverage, against about $2,356 for drivers with good credit, roughly 67 percent more, in NerdWallet’s 2026 rate analysis. In a handful of states, credit cannot legally be used to set your auto rate at all. Which group you live in matters more than almost anything else in this article.
If you have been quoting around with a thin or damaged credit file and every number comes back higher than you expected, you are reading the market correctly. That gap is real, it is documented, and it is not something you imagined or caused by shopping around.
This guide explains what a credit-based insurance score actually is, which states limit or prohibit its use, what the published state benchmarks do and do not tell you, and which levers move the number. If you want the local picture, the Baton Rouge coverage page for drivers with bad credit is a reasonable starting point.
Key Takeaways
Full coverage costs about 67 percent more for drivers with poor credit than for drivers with good credit nationally, about $3,936 versus $2,356 per year, in 2026 published data.
California, Hawaii, Massachusetts, and Michigan do not allow insurers to use credit when setting auto insurance rates.
Maryland, Oregon, and Utah restrict how credit may be used, but the limits are narrower than a full prohibition.
A credit-based insurance score is built from credit data but is not your credit score, and it predicts claims rather than repayment.
Getting an insurance quote does not involve a hard credit pull, so shopping around does not lower your credit score.
No major publisher prints a state-by-state price for minimum coverage specific to drivers with poor credit. Anyone quoting you one is estimating.
How Much More Does Car Insurance Cost With Bad Credit?
Nationally, drivers with poor credit average $3,936 per year for full coverage, compared with about $2,356 per year for drivers with good credit, a difference of roughly 67 percent, according to NerdWallet’s 2026 average car insurance cost analysis. Those are median figures for a modeled driver who is otherwise unremarkable: a clean record, a standard vehicle, full coverage limits.
Two caveats keep that headline honest. First, it describes full coverage. Most drivers shopping hard on price buy state-minimum liability coverage, the lowest coverage level the law allows, where the premium base is much smaller, so the same percentage applies to fewer dollars. Second, it is a national median across all carriers and states. Rate factors are filed and approved state by state, so how heavily any individual insurer weighs credit varies by state and by company.
What Is a Credit-Based Insurance Score?
A credit-based insurance score is a statistical tool that predicts the likelihood of your filing a claim and the likely cost of that claim, as the Insurance Information Institute explains in its breakdown of auto insurance pricing. It is built from credit data, but it is not the same as the FICO or VantageScore a lender pulls: a lender’s score predicts whether you will repay debt, while an insurance score predicts whether you will file a claim, and the two weight the underlying data differently, per NerdWallet’s 2026 explainer on credit-based insurance scores. Getting a quote uses a soft inquiry, so shopping around will not affect your credit score. For how that score is built and how to improve it, plus your rights when credit raises your price, see the companion guide on car insurance with bad credit.
Which States Limit or Prohibit Credit-Based Insurance Scoring?
This is the part most cost guides skip, and it is the single most useful thing to know if you have bad credit. A small number of states have decided that credit should not price your auto policy, or should price it only within limits. If you live in one of them, the 67 percent national gap does not describe your market.
State | How credit may be used in auto insurance |
California | Credit history and credit-based scores are not used for underwriting or rating auto policies. The prohibition dates to Proposition 103 in 1988. |
Hawaii | Auto insurers are barred from using credit ratings when setting underwriting standards and rating plans. |
Massachusetts | Auto insurers may not use credit information or credit-based insurance scores when setting rates, underwriting a new policy, or renewing one. |
Michigan | Not permitted for rating. Michigan’s 2019 no-fault reform bars insurers from using a credit score to set auto rates, effective July 2020: “An insurer shall not use an individual’s credit score to establish or maintain rates or rating classifications for automobile insurance” (MCL 500.2162). Credit may still be used for installment payment options. |
Maryland | Auto insurers may not use credit to deny an initial application, cancel, refuse renewal, or raise a premium at renewal, but may consider it when rating a new policy. |
Oregon | Credit may be considered during initial underwriting, but not as grounds for cancellation or refusal to renew. |
Utah | Credit may be used at the outset, but not after 60 days of coverage, and only to offer a discount rather than to increase a rate. |
Sources: Experian’s state review of credit-based insurance score restrictions (March 2025) and NerdWallet’s credit-based insurance score explainer (2026). Insurance law changes; confirm current rules with your state Department of Insurance before relying on them.
Washington is the cautionary case. The state insurance commissioner issued an emergency rule banning credit scoring in 2021 and a permanent rule in 2022, and courts struck down both, finding the commissioner lacked the authority to impose the ban. Credit is used in Washington today. If you read an older article claiming otherwise, it is out of date.
Worth stating plainly, because it cuts against our own interest: none of the states that prohibit or restrict credit-based insurance scoring are states GoAuto operates in. In most states, credit is a permitted rating factor, so for most drivers the practical response is to understand it rather than to look for a way around it.
What Do the State Benchmarks Actually Show?
Here is what published data does cover: median annual rates for state-minimum coverage across all drivers, in the seven states this data covers. Read the column heading carefully, because it matters. These are all-driver medians, not bad-credit figures.
State | Minimum coverage median, all drivers (per year) | Roughly per month |
Louisiana | $1,250 | About $104 |
Georgia | $1,043 | About $87 |
Texas | $1,078 | About $90 |
Florida | $913 | About $76 |
Nevada | $1,019 | About $85 |
Ohio | $498 | About $42 |
Alabama | $489 | About $41 |
Figures are published third-party medians (NerdWallet, 2026 analysis), not GoAuto rating factors. They model hypothetical drivers across all credit tiers and can change over time.
Now the honest part. No major publisher prints a state-by-state minimum-coverage figure specific to drivers with poor credit. The national 67 percent gap is measured on full coverage, and applying that percentage to a minimum-coverage median would produce a number no source states and no insurer would recognize. Anyone quoting you a precise monthly figure for minimum coverage with bad credit in your state is estimating, including us. That is why the honest answer is to get a quote rather than to trust a table.
What the table does show is real and useful: the spread between states dwarfs almost everything else. The Louisiana median is more than two and a half times the Alabama median for the same legal coverage tier. Where you live is a bigger lever on your premium than most personal factors you could change this year.
Can Bad Credit Disqualify You From Coverage?
Credit is generally used to price a policy rather than to decide, on its own, whether you can buy one. There is no published minimum credit score for auto insurance the way there is for many loan products, which is worth knowing if you have been putting off shopping because you expect a rejection.
Eligibility, though, is not something any article can promise you. It depends on your full record, your state, the vehicle, and the underwriting rules each insurer files with its state regulator, and insurers can and do decline or surcharge for reasons unrelated to credit. The accurate statement is narrow: credit is priced, and a low score by itself is not typically treated as a pass or fail test.
Nonstandard auto insurers are the segment of the market that specializes in drivers whose records, history, or credit fall outside standard-carrier guidelines. How any given insurer weighs credit is set out in the rate factors it files in each state, which is why quoting more than one carrier is the only way to see how differently they treat the same file.
How Can You Lower What You Pay With Bad Credit?
The levers that move the number are fewer than most listicles suggest:
Compare more than one carrier. Credit weighting varies by company and by state, so the same credit file can price very differently across insurers. Quoting costs nothing and does not touch your credit.
Match the coverage to the car. If your car is paid off, state-minimum liability is the lowest coverage level the law allows, and it shrinks the base the credit factor applies to. If your car is financed, your lender will usually require comprehensive and collision, so this option is not open to you.
Do not let coverage lapse. A gap is a separate rating factor that stacks on top of the credit one, and the combination is what makes quotes painful.
Re-quote as your credit improves. Insurance scores refresh, so the factor updates rather than following you permanently.
Know the trade-off. Minimum liability pays for the other side’s injuries and property when a crash is your fault. It does not repair your own car or cover your own injuries. Buying it to save money is a legitimate choice, but make it knowingly. If you are not sure how this applies to your situation, contact GoAuto to talk through your options.
Frequently Asked Questions
Do insurance companies check your credit when you get a quote?
In most states, yes, as one factor among several. There is no hard credit pull when you get a car insurance quote, so shopping around will not affect your credit score the way applying for several loans can. You can compare as many insurance quotes as you like without a credit consequence. In California, Hawaii, Massachusetts, and Michigan, insurers do not use credit for auto rates at all.
Is there car insurance with no credit check?
In most states, nearly all carriers use credit somewhere in pricing, so a true no-credit-check auto policy is uncommon. The exceptions are geographic rather than commercial: in California, Hawaii, Massachusetts, and Michigan, state law removes credit from auto rating entirely. Elsewhere, what varies is how much weight a carrier gives credit relative to your driving record, and that weighting is filed with each state’s insurance regulator rather than advertised.
How much more is car insurance with a low credit score?
Nationally, about 67 percent more for full coverage in 2026 published data, roughly $3,936 per year against $2,356 for a driver with good credit. That figure is measured on full coverage across all carriers. On state-minimum coverage the dollar difference is smaller simply because the base premium is smaller, though no publisher measures that gap directly by state.
Which states do not let credit affect car insurance rates?
California, Hawaii, Massachusetts, and Michigan do not allow insurers to use credit to set auto insurance rates. Maryland, Oregon, and Utah restrict it in narrower ways, for example by barring credit as a reason for cancellation or nonrenewal while still allowing it at initial rating. Washington attempted a ban in 2021 and 2022, but courts overturned both rules, so credit is used there today. Rules change, so confirm with your state Department of Insurance.
Does paying car insurance build credit?
No. Insurance premiums are not reported to the credit bureaus as credit lines, so paying on time does not raise your credit score. What it does protect is your insurance history. Continuous coverage without a lapse is one of the strongest pricing factors you actually control, and it is worth protecting for that reason alone.
What the Credit Numbers Mean for You
Three things are worth carrying away. The published gap between good and poor credit is large but is measured on full coverage rather than on the minimum-liability policy most price-focused shoppers buy. A few states have removed the factor entirely. And no published table prices your specific file, which is why comparing real quotes at identical coverage levels is the only way to find your own number. If you are weighing options, the explainer on how deductibles work is useful before you compare coverage levels.
About GoAuto
GoAuto Insurance writes auto coverage in Texas, Louisiana, Georgia, Florida, Nevada, Ohio, Alabama, and Tennessee, and considers drivers with a range of records. GoAuto focuses on state-minimum liability coverage, the lowest coverage level the law allows, and can handle an SR-22 filing when a state requires one. Down-payment and payment options vary by state and situation. Eligibility, coverage, and pricing depend on your state and your individual circumstances, so to see what applies to you, get a quote.
This article is for general informational purposes only and is not legal, financial, or insurance advice. Coverage, pricing, eligibility, filing timelines, and SR-22 or state-minimum requirements vary by state and by driver. GoAuto Insurance is available in TX, LA, GA, FL, NV, OH, AL, and TN. Confirm requirements with your state DMV and get a quote for terms specific to you.
Sources
- NerdWallet, Average Car Insurance Costs (2026 rate analysis; credit-tier figures and state minimum-coverage medians)
- NerdWallet, Credit-Based Insurance Score: What to Know (updated March 2026)
- Experian, Which States Prohibit or Restrict the Use of Credit-Based Insurance Scores? (March 2025)
- Insurance Information Institute, What Determines the Price of an Auto Insurance Policy
- Michigan Public, Michigan Drivers Pay the Highest Credit Penalty for Car Insurance in the U.S. (August 2023)
- Independent Agent Magazine, Washington State Judge Overturns Credit Scoring Ban (2022)
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