Can I Buy No Down Payment Car Insurance?

Written by Megan Lee and 1 other
Updated Jan 28, 2025

All reputable insurers require payment to activate your policy.

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You always have to make a payment to start a new car insurance policy, so in that sense, there’s no such thing as “no down payment car insurance.” But the amount you have to put down can vary — some insurance companies require you to pay a percent of your total premium up front, while others only require the first of your monthly premium payments to activate the policy.

What is no down payment car insurance?

All reputable car insurance providers require payment to start your policy, so “no down payment car insurance” doesn’t technically exist.

Some auto insurance companies advertise “no down payment” or “low down payment” policies. Usually, this means the insurer doesn’t charge additional onboarding fees, but you still have to make a payment (your first monthly installment or the full policy cost) to activate coverage.

Why car insurers require payment to start a policy

The primary reason insurers require a down payment is to help offset some of the company’s risk in covering month-to-month customers. This ensures that there’s at least some revenue coming in if customers file a claim shortly after beginning a new policy.

How much do car insurance down payments cost?

The cost of your car insurance down payment depends on the total cost of your car insurance policy and whether you’re paying your premium in installments or all at once at the start of your policy. An insurer may also consider information like your credit or driving history to determine your deposit amount.

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How paying your premium up front vs. monthly affects the down payment

If you choose to pay your premium in monthly installments, your down payment will be the cost of the first installment, plus any additional onboarding fees.

If you pay your car insurance premium in full, the “down payment” will be the total premium for that policy term. Insurers usually charge lower rates to drivers who pay in full than those who pay monthly.

There are two reasons that paying your premium in a lump sum can help you save over the life of your policy:

  1. You may get a paid-in-full discount. Many insurance companies offer discounts for paying your six-month or annual premium in full at the start of your policy term.
  2. You could avoid installment fees. An installment fee is an additional charge that an insurer may add to your premium when you split it into multiple payments. If you pay all at once, you won’t be charged installment fees.

Tips to lower your car insurance premium — and down payment

Because the down payment is a portion of the total premium, the key to a low down payment is a low premium. Here are some tips to find a low-cost policy.

  • Shop around. No two insurers calculate premiums the same way, meaning it pays to get quotes from multiple providers as you search for an affordable rate.
  • Look for discounts. Many car insurance companies offer discounts, and these offerings can change over time. For instance, you could save by bundling your homeowners and auto insurance or being a safe driver. Ask an agent if you’re missing out on any opportunities to reduce your rate. 
  • Keep a clean driving history. “High risk” drivers pay higher rates than drivers with clean records. The longer you go without an accident, traffic violation or insurance claim, the more likely you are to find savings.
  • Consider a higher deductible. Drivers who choose higher deductibles get lower premiums, but tread carefully with this option. If you’re in an accident, you may have to come up with the cost of the deductible quickly.
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Megan Lee

Megan Lee is an editor, writer, and SEO expert who specializes in insurance, personal finance, travel, and healthcare. She has been published in U.S. News & World Report, USA Today and elsewhere, and has spoken at conferences like that of NAFSA: Association of International Educators. Megan has built and directed remote content teams and editorial strategies for several websites, including NerdWallet. When she`s not crafting her next piece of content, Megan adventures around her Midwest home base where she likes to drink cortados, attend theme parties, ride her bike and cook Asian food.

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Annie Millerbernd

Annie is a content strategist at Jerry and has more than a decade of experience writing and editing digital content. Before joining Jerry, she was an assistant assigning editor at NerdWallet, where she covered loans. Previously, she worked at USAA and newspapers in Minnesota, North Dakota, California, and Texas. She holds a bachelor’s degree in journalism from the University of Minnesota.