Cheap Car Insurance for Unemployed Drivers

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How to find cheap car insurance when you're unemployed

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.

 

Primary topics:
  1. Do car insurance companies charge unemployed drivers more?
  2. Why does employment status matter for insurance?
  3. Resources and tips
  4. What insurance providers are best for unemployed drivers?

 


 

Do unemployed people pay more for auto insurance?

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.

 


 

Auto insurance and employment

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.

 


 

How to save on car insurance while unemployed

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.

 

Consider telematics

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.

 

CompanyEstimated Savings
Progressive's SnapShotAverage of $130
Allstate's DrivewiseAverage of 10-25%
State Farm Drive Safe & SaveUp to 15%
Esurance DriveSenseVaries
Nationwide SmartRideUp to 40%
Liberty Mutual RightTrackAverage of 5-30%

Consider, however, that not every state participates in these programs. Check with your company to see if you are eligible.

 

Pay smart

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.

Payment method savings
Savings with Paid in FullSavings 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.

 

Bundle policies

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.

Insurance bundle savings
Savings with RentersSavings with Home
$73$142

Data show traditional multi-policy parings (home/auto), but this discount can apply to any combination of two insurance policies.

 

Drive safely

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.

Average increase in premiums after incidents
Accident/Violation6 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

 

Be prudent with your coverage

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:

  • Determine the value of your vehicle by using Kelley Blue Book and NADA guide
  • Contrast the premium with full coverage between only have liability coverage. If that difference in premium is enough to replace the value (determined in step 1), you probably don't need full coverage.
  • If the premium difference is not enough, consider raising your deductibles - by raising your deductibles you can lower your premium. If, however, you do raise your deductible, you increase your financial responsibility for any at-fault accidents. Your deductible is what you pay before the insurance company steps in.

 

Compare rates

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.

Compare rates from leading insurance companies today!

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Which insurance companies are affordable for unemployed drivers?

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.


Recent Questions:

Cheap Car Insurance for Unemployed Drivers

Should I stay with my care insurance company even if I'm getting a better quote from elsewhere?

It's possible that your agent is simply trying to keep your business. However, he may actually be correct.

What is the average cost of car insurance in Virginia?

That's a difficult question to answer. Below are some answers based on the information you have given me.

Why am I being asked for my personal information for a car insurance quote?

According to our data, the average cost of minimum liability car insurance in California is $573 per year. Below are some additional coverage options you can consider: State Minimum — Liability Only $573 State Minimum — $1,000 Comprehensive/Collision $1,297 State Minimum — $500 Comprehensive/Collision $1,481   That said, this is based on a 30-year-old male driver with no accidents or violations and good credit.

Is it discrimination not to allow someone to get car insurance w/out an address?

It's not discrimination, it's how car insurance is priced. You have to have a physical address to of where the car is kept the majority of the time since the location is a big rating factor.