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Unemployment can be stressful. You face housing, food, and transportation costs — including the additional expense of auto insurance. Car insurance is legally required, even when you're unemployed, and there aren’t many resources available to help if you aren’t receiving regular paychecks. Let’s explore cheap car insurance options for unemployed drivers.
Usually, no. Insurance companies do use as many factors as possible to accurately calculate the risk presented by a potential client. These things may include your driving habits, location, what kind of car you drive, and your age — but not necessarily your occupation. They can use your job status as an indicator of your potential risk as a customer. We’ll explain that below.
Certain professions are associated with less risk than others, leading companies to offer discounts for those professions. That said, insurance companies do not use your occupational status as a rating factor, nor do you have an obligation to tell your insurance company mid-policy term if you resign or lose your job. Insurance companies cannot charge you more based on what you do.
If you want to see what insurance companies do use to calculate premiums, see our guide here.
Not having a job won’t impact your insurance premium. However, what you do for a living can impact your premium. The occupations listed below are commonly rewarded with affinity or membership auto insurance discounts.
Even if you're unemployed, it is possible to save on auto insurance.
Although you’re not directly punished for lack of employment by your insurance company, your premiums provide the sting of spending money while your income is limited. So it's worth comparing quotes and finding ways to save.
Telematics, or usage-based insurance, is a growing trend in the insurance industry. Basically, it uses an in-car device to track your driving habits. And your habits will determine a premium that is more representative of the risk you actually present to your insurance company. Your age, credit history, and location are all big rating factors in most states for your premium that aren’t directly tied to how you drive. Below are some companies and corresponding potential discounts that could come as a byproduct of telematics-based insurance.
| Company | Estimated Savings |
|---|---|
| Progressive's SnapShot | Average of $130 |
| Allstate's Drivewise | Average of 10-25% |
| State Farm Drive Safe & Save | Up to 15% |
| Esurance DriveSense | Varies |
| Nationwide SmartRide | Up to 40% |
| Liberty Mutual RightTrack | Average of 5-30% |
Consider, however, that not every state participates in these programs. Check with your company to see if you are eligible.
The way in which you pay for insurance can help reduce your premium. For example, paying your premium at once rather than monthly can help reduce your installment and processing fees. This is called a paid in full discount.
| Savings with Paid in Full | Savings with EFT |
|---|---|
| $69 | $22 |
The second part of our “paying smart” suggestions might be a little easier if you’re unable to pay your entire premium up front. Paying via electronic funds transfer (direct deposit from your bank account) can help eliminate pesky transaction fees associated with debit and credit cards. Although less than a paid in full discount, it can still be helpful.
If you own or rent an apartment, consider carrying your home or renters insurance with the same company as your auto policy (or vice-versa). This will save you the hassle of dealing with multiple insurance companies while potentially providing a multi-policy discount. While the discount below reflects the savings on your auto policy, you would receive a discount on both policies.
| Savings with Renters | Savings with Home |
|---|---|
| $73 | $142 |
Data show traditional multi-policy parings (home/auto), but this discount can apply to any combination of two insurance policies.
At any time, regardless of employment status, you should always strive to drive safely. But now that you’re looking for work this fact is even more important. As you can see below, receiving a DUI can raise your premium an average of $543 per six-month policy. Consider, however, that you will be charged for DUIs for a total of 3 years (on average, 10 years in California). So, that $543 will actually stretch into over $3,258 over your three-year period.
| Accident/Violation | 6 Month Premium Increase |
|---|---|
| None | |
| Speeding 11 - 15 MPH Over Limit | $154 |
| Speeding 16 - 20 MPH Over Limit | $171 |
| Speeding 21 - 25 MPH Over Limit | $190 |
| At-Fault Accident | $308 |
| Reckless Driving | $517 |
| Racing | $542 |
| DUI | $543 |
Unlike a house, a car depreciates in value over time. So, if you bought a brand new vehicle a decade ago, chances are you don't need the same insurance protection you once had. The only coverages you are required by law to have (unless you have a lien) are your state liability limits. Other coverages, like comprehensive and collision, are designed to protect your car. Consider if the value of your vehicle (which can be easily determined through Kelley Bluebook or NADA guide) is worth what you pay for these additional coverages. Here are our quick tips for determining coverage:
Shopping for car insurance is probably the absolute best way to find a cheaper rate. You can look for all the discounts, consider all the telematics out there and still be paying an arm and a leg for auto insurance. Sometimes it’s just your company. The Zebra helps you compare more than 100 insurance companies online in order to find the best rates, saving you time to search for what you really want: a job.
Insurance is regulated at the state level and priced at the ZIP code level. It's very hard to prescribe the cheapest option. Your best bet is to fetch free quotes often to see rates from as many companies as possible.
If you'd like more specific information regarding companies and premiums, see some of our case studies below.
