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Car Insurance for Unemployed Drivers: Quotes, Discounts for 2022

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JJ Starr

By: JJ Starr

Edited by Jackie Cohen | Reviewed by Licensed Insurance Agent, Amber Benka

Updated September 15, 2022

When you wind up unemployed, you can feel isolated. But you’re not alone: millions of Americans go through unemployment every year. Most people experience some period of unemployment over the course of their careers. Luckily, it won’t last forever—the average worker spends 21 weeks unemployed before finding a new job.

Making it through unemployment while meeting your basic needs may take some creativity, but you can do it. And this article will help you find cheap car insurance coverage in the meantime. Ready to find cheap coverage now? Use Insurify to compare accurate car insurance quotes and snag the lowest rate quickly. It’s easy and free to use!

Quick Facts

  • Unemployment will not directly affect a driver’s car insurance rates.

  • The cheapest insurer we found for unemployed drivers is USH&C, with average premiums of $92 per month.

  • Usage-based discounts can help unemployed drivers save on car insurance if they drive fewer miles because they’re not commuting to work.

Cheapest Car Insurance Companies for Unemployed Drivers

How much is car insurance for unemployed people?

Car insurance is not directly affected by unemployment. However, if you used to drive to commute to work, you may even save on your insurance costs when you are unemployed through low mileage discounts and changing the primary use of your car from “commute” to “pleasure”.

If you’re looking to lower your auto insurance rate, you should look into working with an auto insurance company known for offering low premiums. Luckily, there are many options for you to choose from no matter where you live.

We reviewed hundreds of quotes given to unemployed drivers across the country to determine which companies are offering the lowest rates. Below is a list of top companies offering the lowest car insurance premiums on average nationwide.

Insurance CompanyMonthly Quote for Unemployed Drivers
Amigo USA$101
National General$123
Travelers$140
AssuranceAmerica$143
Elephant$167
Clearcover$174
Dairyland$179
Nationwide$180
Mercury$198
Bristol West$206
Liberty Mutual$214
The General$234
Disclaimer: actual quotes may vary based on the policyholder's unique driver profile.

See More: Car Insurance Quotes

How does being unemployed affect car insurance?

To fully understand how being unemployed affects you, you should understand the factors that influence the cost of your auto insurance policy. In other words, understand which risk factors are insurers looking at. These factors include:

  • Location—claim rates, crime rates, weather patterns, and medical costs in your ZIP code

  • Usage—how many miles you drive and the primary purpose behind your driving (commuting, pleasure, etc.)

  • Personal details—your age, marital status, job, homeownership status, and other personal information

  • Driving history—your history of moving violations, at-fault accidents, DUI, and how long you’ve had your driver’s license

  • Vehicle—your make and model, plus the age of your car.

You’ll notice that your employment status did not make the list. That’s because it does not directly affect the cost of car insurance. When you lose your job, your rate won’t suddenly go up or down. But unemployment can indirectly affect your expenses in a few ways.

Your car’s primary purpose has likely changed. If you used to commute to work, your vehicle usage classification has changed from “commute” to “pleasure.” And that’s a good thing—“pleasure” drivers get lower rates than “commuters.”

You also may drive less now than when you were employed. That means you could qualify for low-mileage discounts and rates. Driving fewer miles also means less wear and tear on your vehicle, which also saves you money.

On the other hand, you may also lose any employment-related discounts. Unemployment can affect your ability to pay your premium. A lapse in coverage can raise your rates in the future, so always try to work with your insurer when you’re having difficulty paying.

See More: Best Car Insurance Companies

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How Unemployed Drivers Can Get Cheap Car Insurance

There are many ways to lower your car insurance costs, but one of the best ways is by taking advantage of policy discounts. There are many insurance discounts available, and nothing stops you from stacking multiple discounts together.

Different insurers offer different sets of discounts. And some will give more significant discounts for the same thing. Common discounts include bundling, multi-vehicle, low-mileage, and more.

Discounts related to billing—autopay, for example—can get you 2 to 10 percent off your premium. Other discount programs are more valuable. A defensive driver course, for example, can get you up to 20 percent off. Participating in a telematics program can get you as much as 25 percent off when you show responsible driving habits.

Beyond discounts, there are a few other housekeeping rules you should keep in mind to receive low rates now and in the future:

  • Obey traffic laws and practice safe driving habits to avoid rate-hiking incidents like speeding tickets, car accidents, and DUIs.

  • Maintain a good credit score and work on increasing your score if it’s low. Paying bills on time and avoiding debt is possible on a tight budget.

  • Compare car insurance rates often, at least every six months. Rates change quickly. Making comparison-shopping part of your regular financial practice helps you take advantage of lower rates. It might be worth switching car insurance.

See More: Cheap Car Insurance

Cheapest States for Car Insurance for Unemployed Drivers

Where you live has a significant impact on what you pay for car insurance. That’s because insurance companies determine your rate based on risks specific to your ZIP code. Below are the cheapest states for getting car insurance when you’re unemployed. It’s no surprise that this list is dominated by states whose residents primarily reside in rural areas.

Insurance CompanyCheapest Monthly Quote
Montana$82
New York$94
Iowa$103
Idaho$105
Indiana$110
Ohio$115
Minnesota$126
Nebraska$127
Kansas$130
New Mexico$131
Illinois$132
Wisconsin$136
Utah$137
Tennessee$138
Arkansas$141
Oregon$141
Virginia$142
Massachusetts$143
Oklahoma$149
Pennsylvania$150
California$153
Alabama$154
Arizona$162
Missouri$179
Washington$183
Texas$189
Mississippi$192
West Virginia$198
Colorado$208
South Carolina$215
Washington, D.C.$231
Georgia$233
Kentucky$239
Maryland$240
Connecticut$242
Louisiana$258
Rhode Island$266
Florida$273
Nevada$283
Michigan$300
New Jersey$306
Delaware$316
New York$375
Disclaimer: actual quotes may vary based on the policyholder's unique driver profile.

See More: Best and Worst Sites to Compare Car Insurance

Tips for Cheaper Car Insurance for Unemployed Drivers

When cheap car insurance is required to fit an unexpectedly small budget, you’ve got to take every measure you can to lower your rate. Deep breaths: there are many ways to get a lower rate. Some require more drastic changes than others but result in a more drastic reduction in your costs. Follow these tips to make car insurance affordable for you.

Remove Coverage You Don’t Need

When you opt for full-coverage car insurance, you end up paying a lot more than you would for liability-only coverage. That’s because collision and comprehensive coverage claims are expensive. Dropping these coverage types can lower your rate by hundreds a year.

A word of caution: don’t lower your liability limits. It typically costs just a few dollars a month to have double or triple the state minimum coverage. That’s a lot of protection for little cost, and you may find you need it in the event of an at-fault accident.

Consider Trading In Your Vehicle for a Less Expensive One

If you have a car with a car loan, your lender will require you to purchase comprehensive coverage, collision coverage, or both. If you have enough equity in your vehicle, you could trade in your newer car for an older, reliable vehicle that you own outright. You’ll have many options that cost less than $5,000.

Older cars cost less to insure, and you’ll be able to drop those additional coverage options. Plus, you’ll be able to cut your car payment out of your budget, leaving you with even more room in your new budget.

Swap for a Car Storage Insurance Policy

If you don’t need to use your car, you can put it in storage and pay for low-cost car storage insurance. This is a great option to lower your costs without getting rid of or exchanging your car.

Raise Your Deductible (Within Reason)

Your deductible is what you pay in the event of a claim: the higher your deductible, the lower your monthly premium. A higher deductible also makes it less likely you’ll make a claim when you could pay for a repair out of pocket. Just don’t raise your deductible higher than what you could reasonably afford.

Shop Around for Car Insurance

Comparing car insurance rates is the best way to know you’re paying the lowest cost possible for auto insurance. With Insurify, this process is fast and straightforward. Fill out one brief, confidential form, and get actual quotes from top insurers in your area. Adjust coverage options, like limits and deductibles, to see if minor tweaks can equal significant savings.

Cheap Car Insurance for Unemployed People Is Possible

When you need to save money, you’ve got to take advantage of every cost-cutting practice you can. Higher premiums are not inevitable. Taking advantage of the best car insurance discounts is a great start. But you can also adjust your plan and/or your vehicle to lower your rate even further.

And don’t forget to shop with Insurify. With our car insurance comparison tool, you can compare costs for different coverage options and save your profile to compare rates quickly in the future. It’s the easiest way to get a car insurance policy for less.

Frequently Asked Questions

  • Car insurance is not deductible for people on unemployment. It is deductible for some self-employed people, qualified performing artists, and army reservists. If you’re unsure if you can deduct your insurance payments, speak to a tax professional.

  • If you’re unemployed, you can lower your premiums by taking advantage of discounts, raising your deductibles, and getting rid of unnecessary coverage. If you need a more drastic reduction in costs, you could trade in your vehicle for one with cheaper carrying costs. You could also choose not to drive your vehicle and purchase a car storage policy while unemployed.

  • The easiest way to get multiple quotes fast is by using Insurify. When you fill out our short form, you keep your information private (no spam!) while getting access to accurate quotes from six or more top companies. We use proprietary AI technology to ensure your quote is accurate. When you find a lower rate, switching is easy.

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  • Data scientists at Insurify analyzed over 40 million auto insurance rates across the United States to compile the car insurance quotes, statistics, and data visualizations displayed on this page. The car insurance data includes coverage analysis and details on drivers' vehicles, driving records, and demographic information. With these insights, Insurify is able to offer drivers insight into how their car insurance premiums are priced by companies.

JJ Starr
JJ Starr
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Insurance Writer

J.J. Starr is a health and finance writer with a background in banking, lending, and financial advising. She holds a Series 6, FINRA, and life insurance licensure and a master's degree from New York University. Through her writing, she strives to use her decade of experience to help consumers make sound financial choices. Connect with J.J. on LinkedIn.

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