Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health insuran...

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Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

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Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager

UPDATED: Aug 9, 2021

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Here's what you need to know...

  • Insurance companies are prohibited from using your employment status to determine if you’re eligible for car insurance
  • While being jobless can’t make you ineligible for the coverage that you’re applying for, getting car insurance without a job can affect how much you pay for your insurance because of the usage classification that will be assigned to your vehicle
  • Vehicle usage affects your coverage because your likelihood of getting into an accident is higher when you’re driving in more stressful conditions
  • Since unemployed drivers and retired drivers can receive a pleasure rating, they will likely pay less for their coverage than a commuter with the same exact rating factors
  • Your employment status can affect the number of miles that you drive. Surprisingly, being jobless can help you lower your rates as long as you keep your credit score up

Can I get car insurance without a job? Having a job or a regular source of income is a requirement when you’re applying for an auto loan, but do you need a job to get car insurance? A job is not a requirement for getting car insurance.

If you recently lost your job and are in the process of buying car insurance from car insurance companies, your current lack of employment could make you nervous about your application for auto insurance being rejected. It’s understandable, but being jobless doesn’t mean you have to be or should be uninsured. In fact, if you have a vehicle, you should have an auto insurance policy.

Employment status cannot and doesn’t directly impact your rates. However, there are related factors that can change when your job status changes. One of these factors is your credit score, which you can read in a later section how that can affect your insurance rates.

If you’re planning on leaving your job or are about to shop for insurance as an uninsured consumer, get familiar with how your car insurance rates and policy class can change when you have no job but need a car insurance policy.

To make sure you’re not overpaying for car insurance without a job, compare rates today. Enter your ZIP code in the box above to get started for free.

Why is using employment status for eligibility determination illegal?

Does being unemployed affect your car insurance rates? No. All insurance companies are prohibited from using discriminatory practices to underwrite an application and calculate rates when writing policies for car insurance for the unemployed.

While every state department has their own definition of what’s considered discriminatory, such as laws about car insurance occupation categories, all states prohibit carriers from denying someone coverage just because they are unemployed at the time of application.

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How does your employment status affect vehicle usage classifications?

Are you wondering how do I get insurance without a job? While you can buy insurance no matter your employment status, it may change your rates. Just because insurers can’t look at your employment status or income when determining eligibility doesn’t mean that being in search of a job doesn’t have an indirect effect on your rates.

When you apply for coverage, the insurance company will use dozens of rating categories to calculate your personalized rate. One of the factors that they use is vehicle usage.

When an agent asks you how you primarily drive your vehicle, you must choose from three options: pleasure, commute, and business. When you’re working, it’s common for your primary vehicle to be assigned as a commuter car or a business car.

After you leave your job, you go from that class to a pleasure user, which is the cheapest option available.

Does low mileage lower insurance rates?

What is the best occupation for cheap car insurance? Being unemployed can actually sometimes be the cheapest employment status for car insurance. Not only does vehicle usage change when you’re unemployed, your annual mileage will go down as well. When you cut 10, 20, or 30 miles from your driving daily, the number of miles that you put on your car will drop quickly.

The less you’re on the road, the less you can expect to pay.

Car insurance companies use mileage rating bands to rate risk. If you’re between 10,000 and 15,000 miles per year, you’re considered average.

If you go below this number, you could be classified as a low mileage driver which will definitely save you money. Drivers who put less than 5,000 miles on their car each year will pay the lowest rates.

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Will I lose my occupation discount if I’m unemployed?

Many carriers offer their clients discounts just because of what they do. Since some professionals are known to be better drivers than others as a whole, you can benefit from pursuing a job in a certain field.

Unfortunately, you’ll lose the occupational and affinity discounts that you were receiving if you were working in a safe field. Still, there are always available car insurance discounts you should always ask about.

Does my credit score affect my car insurance rate?

Are my car insurance rates based on credit score? Acccording to the National Association of Insurance Commissioners (NAIC), state do have laws making sure that insurers can’t use credit score as the sole reason for changing rates or canceling policies.

However, with the exception of three states, insurance companies can use your credit history to help and put you in a rating category. If you live in California, Maryland, and Hawaii, you don’t have to worry about changes in your credit filing affecting your rates. In all other states, you do.

Insurance want to do a credit check on potential customers due to those with bad credit often having trouble with making their payments on time. If your employment status is interfering with your paying bills on time, your credit score may reflect that, and insurance carriers can take notice if you have bad credit.

To show you how credit score impacts rates, we partnered with Quadrant to bring you data on rates by company.

Car Insurance Rates Based on Credit Score
Car Insurance Rates Based on Credit Score Good Credit Fair Credit Poor Credit
Allstate$3,859.66$4,581.16$6,490.65
American Family$2,691.74$3,169.53$4,467.98
Farmers$3,677.12$3,899.41$4,864.14
GEICO$2,434.82$2,986.79$4,259.50
Liberty Mutual$4,388.18$5,604.24$8,802.22
Nationwide$2,925.94$3,254.83$4,083.29
Progressive$3,628.85$3,956.31$4,737.64
State Farm$2,174.26$2,853.00$4,951.20
Travelers$4,058.97$4,344.10$5,160.22
USAA$1,821.20$2,219.83$3,690.73
Average $3,166.07$3,686.92$5,150.76
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If you were suddenly fired or laid off, it’s easy for the quick change in your employment status to affect your ability to pay your bills. You have to prioritize the invoices you’re receiving and let some of the payments go into default status until you can catch up.

Unfortunately, since your credit score is used in ratings, the change in your score can negatively affect your rates.

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How is your credit used when rating a policy?

Insurance companies don’t actually look at your full credit report. Since some of the data reported are considered discriminatory, companies will use a credit-based insurance score that’s calculated by a third-party rating agency.

Some of the factors used to calculate a credit-based score includes:

  • Credit mix
  • Length of credit history
  • Defaults reported by creditors
  • Outstanding debt
  • Payment history
  • Pursuit of new credit accounts

Poor credit may also affect your ability to buy a car. So if you are wondering can I buy a car without a job, the answer will come down to credit.

How can future claims affect your insurance rates?

One of the things you don’t think about when you’re unemployed is how being out of a job can really affect your likelihood of filing a claim after you have a covered loss.

If you get into an accident or someone vandalizes your car, you may be able to pay for the repairs out of your pocket when you have a regular income. This isn’t possible when you don’t have money coming in.

Physical damage claims can affect your rates in the future after your policy renews. If your car is damaged, and you have full coverage, the rates can go up as long as you’re at fault for the loss.

If you have accident forgiveness on your policy or the damage doesn’t exceed the state’s accident reporting threshold, your rates won’t be impacted.

Being unemployed doesn’t mean that it’s okay to be uninsured. In fact, when you own a vehicle in a state where car insurance is mandatory, you must keep your insurance active to keep an active registration. If your coverage has lapsed, it’s time to get insurance.

If you have no job and are looking for cheaper car insurance, use our rate comparison tool to get instant quotes for insurance in just minutes. Can you get car insurance without a job? Now that you know the answer, enter your ZIP code in the box below.