Why does my job affect my car insurance?

Your occupation affects your car insurance rates through (1) the length of your commute, (2) how responsible your insurer sees you as, and (3) your general stress levels.

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Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Jan 24, 2021

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Here's what you need to know...

  • Your occupation has an influence on your car insurance premium
  • Many insurance companies believe that your tasks and responsibilities in the workplace in some ways define the type of person and driver you are
  • If you have a high-stress job, you can expect your car insurance rates to be higher

Yes, it’s true! When shopping for car insurance, occupations affect rates. As hard as it may be to believe, your chosen occupation has a great deal to do with the rate of your insurance premium.

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On one hand, what you do for a living could save you a bundle. On the other hand, it could also cost you more than you expect. Here are some examples from both ends of the spectrum.

Additionally, there are steps you can take to lower your premium, should you be on the wrong end of that spectrum.

Occupation Rankings

The lowest auto insurance premiums are paid by scientists, who pay an average annual rate of $870. Individuals who are retired from their jobs pay a little more, with an average premium of $920.

Another occupation that fits into the low insurance premium bracket is navigators or airline pilots.

Business owners tend to be the most expensive occupation.

Their insurance premiums average $1,400 every year. Business executives pay an average of $1375, and those in the judicial sector (judges and lawyers) pay an average of $1370.

Overall, occupations with low insurance premiums have several factors in common:

  • The occupations generally have low-stress levels.
  • They are usually responsible for the safety and well-being of others, and their driving records ultimately tend to dictate their ability to practice their line of work.
  • They tend to utilize public transportation more than other occupations.
  • They tend to have meticulous habits, which affect their driving abilities.

On the flip side, those with higher insurance premiums fall into the following category:

  • Their occupations have high levels of stress.
  • They tend to spend a great deal of time in their vehicles.
  • They tend to utilize cell phones more than the average driver.

At first glance, it may seem capricious and arbitrary that some individuals pay less while some pay more, but when you consider the factors above more carefully, it becomes more obvious why some are more expensive to insure than others.

Whatever group you fit in with, if you understand the basics that have a bearing on your insurance premium, you can enjoy considerable savings by shopping around and doing your research.

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Occupation Doesn’t Have to be an Obstacle

The spectrum of jobs is an extremely expansive one. Not only do they identify who you are and what you do, but they also have a great deal to do with how much you are going to pay for your insurance premium. Life insurance is another case in point of this type of job categorization.

As mentioned previously, certain job titles tend to command a degree of consideration to car insurance companies while others do not denote a large risk. Below is a list of occupations and average premiums.

You will have the ability to determine where your own job title falls on the spectrum.

The following is based on a 2006 report provided by Comparison Market, rounded to the nearest dollar.

  • Scientific Field $870
  • Retired Individual $918
  • Currently Unemployed $934
  • Pilot/Flier/Navigation $966
  • Individuals with Disabilities $968
  • Actor/Performer/Artist $971
  • Librarian Science/Historian $1,009
  • Farming $1,016
  • College Student $1,029
  • Public Official/Civil Servant $1,069
  • Designing $1,071
  • Waiter/Food Service/Bartender/Host $1,071
  • Engineer Science $1,088
  • Athlete/Exercise Science $1,088
  • Homemaker/Domestic Engineer $1,092
  • Instructor/Teacher/Coach/Assistant $1,099
  • Animal Trainer/Dog Groomer $1,103
  • Store Clerk/Cashier $1,106
  • Computer Science/Math/Researcher $1,110
  • Restaurant Chef/Baker $1,115

Car Insurance Rankings

For each of the occupations, there is a good explanation for why it ranks towards the top and bottom of the chart.

For example, if you are a scientist, most of your research is done at home or at a company that pays you to be a careful and detailed person. You are paid to do valuable research and work. Such people tend to be more careful in both their thoughts and actions.

Because of this behavior, they tend to get into fewer accidents. Consequently, they are classified as being better drivers, which lowers their average premium to $870.

Another example would be that of retired people. Because retired people don’t have a set schedule or someplace they have to be at the same time every day, they tend to drive less. Therefore, there is less of the possibility of them getting into an accident.

To insurance companies, this makes them a much better risk than someone who commutes to and from an office every day.

For this reason, the average retired person has a premium of $917.

On the other hand, business executives tend to pay approximately $1,375. For one, business executives tend to use their cell phones in their vehicles more frequently than other people, which has been proven to be one of the leading causes of accidents in the United States.

As a result, insurance companies consider executives to be higher risks than senior citizens. Additionally, business executives tend to drive more expensive vehicles. These cars are more expensive to fix in the event of an accident. Therefore, their policies are more expensive.

What you do for a living will affect your automobile insurance.

Based on what you drive, how far you drive each day, and how you drive, your insurance company puts you either in a high-risk driver category or a low-risk driver category, which will dictate your monthly premium.

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Average Monthly Car Insurance Rates by State