How does my job affect my car insurance?

Insurance companies determine how your job affects car insurance rates based on your likelihood to file a claim. Factors like job stress, commute time, and where you work can all raise your rates.

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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 21, 2021

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Here's what you need to know...

  • There are many factors that go into your car insurance premiums.
  • Your occupation is one of these factors that will potentially raise or lower your car insurance rate.
  • High-stress jobs will impact your car insurance negatively.
  • Certain professions are statistically related to safer drivers, so people working those jobs can expect to pay a little less for car insurance.

Some of these factors can easily be changed and other factors are beyond your control. It is important to learn more about the factors that you can control so that you understand how your lifestyle and your choices affect the cost for coverage.

One of the most surprising factors that can lead to rate hikes or cost-saving discounts that will make your comprehensive coverage more affordable is your occupation.

Your job title and the type of work that you do can really impact your premiums for more than just one reason.

If you are thinking about pursuing a specific job or you just would like to know why your rates are higher than they were before you switched professions, read this guide to your occupation and how it impacts insurance to learn the basics your agent may not have told you.

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Why do car insurance agents ask for your job?

There is a long list of different factors that affect car insurance premiums:

  • Your driving record
  • Your gender
  • How long you have been licensed
  • Your accident history
  • The type of vehicle that you drive
  • How often you drive

When you are getting a quote for car insurance, the agent will ask you a long list of application questions so that they can accurately rate you and assign a risk rating.

It is not out of the ordinary for the agent to ask you what you do for a living. While you might have thought this was small talk, the answer that you give can actually affect your risk rating.

One of the main reasons occupation is used when calculating quotes for clients is because the statistics show that a person’s profession is directly related to how likely they are to get into an accident.

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Enter your ZIP code below to view companies that have cheap car insurance rates.

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How are risk and occupation related?

There’s a long list of occupations that are considered to be high-risk occupations. In the world of insurance, risk and premium are directly related.

In the world of insurance, risk and premium are directly related. With more responsibility and stability comes much lower risk.

The main reason why occupation can make you a higher risk rating is because the research shows that the racier the job, the higher the likelihood of a claim being filed.

Some professionals are classified as more responsible or more financially stable.

What occupations are riskiest?

The highest risk-rated occupations are generally in professional sports.

DJ’s and other professionals that work in social scenes tend to pay higher rates as well. The reason for this is because they are exposed to atmospheres where there is drinking and work overnight where rates for serious accidents are high.

The reason for this is because they are exposed to atmospheres where there is drinking and work overnight where rates for serious accidents are high.

The hours when professionals work, the level of stress, the potential for distractions, the setting they work in, and even the type of work that they do can truly attribute to risk.

You should check to find out if your profession is going to be in the higher risk range so that you are prepared as you search for quotes.

What occupations are low-risk?

Insurers also do studies to determine which professionals are eligible for low rates because of their low-risk occupation.

Based on the statistics, nurses are the lowest risk professionals because they have been proven to be very responsible behind the wheel.

The statistical data says that the following professionals pay the lowest rates because their job requires special attention to detail that leads to better driving habits:

  • School teachers
  • Scientists
  • Police officers
  • Detectives
  • Paramedics
  • Pilots
  • Actors
  • Artists

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Are there discounts for any occupations?

Now that you know how your occupation can affect your rating, you might be wondering if you can receive any job-related discounts.

Insurers offer a long list of auto insurance policy discounts to policyholders who are eligible so that they can keep their premiums competitive.

Many companies do offer affinity discounts to their applicants who work for a specific employer, belong to a professional group or who are in a certain field.

Even members of some fraternities or sororities can save. You should ask your employer or the association you are affiliated with if there is a certain insurer that offers these discounts.

Other Rating Factors That Are Indirectly Related to Occupation

Your job title is not the only thing considered to determine how likely you are to cost the carrier money. In addition to reviewing statistics based on the title alone, the company will assess the applicant’s driving habits.

Your occupation will directly affect your habits because it is the main reason that you drive.

Here are some of the ways that your job affects your car insurance ratings:

Vehicle Usage

A majority of professionals will use their vehicle to commute to and from work when they report to an office. When you report that you are commuting to work, you will be considered a commute user instead of being a pleasure user.

Pleasure users pay the lowest rates because they drive in the least stressful atmospheres. If you drive to multiple locations for work, however, you will be a business user.

Business users have the highest risk because they drive with passengers and often rise on unfamiliar terrain.

Annual Mileage

How much you drive affects rates as well. This is because the more that you drive, the higher your risk of an accident.

If you have a long commute to the office, you are going to pay more than someone who lives right around the block. This is because your distance to work is high and your annual mileage will be as well.

Vehicle Type

In some occupations, your car might be considered a tool used in conjunction with your job. If you are required to buy a specific type of car, your rates may be affected by the type of car that you drive.

This is especially true if you have a car that is expensive to insure, that has special equipment built-in, or if it has a poor safety record.

Not many people are going to switch careers because their insurance rates are high, but it can be helpful to know what you can expect when you buy coverage.

If you are not happy with the rates that you are being charged by your insurer, it is the right time to comparison shop.

You can easily start pricing the cost of insurance and compare rates by using our FREE tool below! Once you enter your information and disclose your occupation, you will be directed to instant rates quotes for easy comparison.

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