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Does My Education Level Affect My Car Insurance Rates?

    2 minute read

    There are many ways you can qualify for a discount on your Car Insurance. But did you know that your education level could be one of them? Yes, people who are well-educated often have lower Car Insurance rates. So, if you’re looking for another way to put your college degree to use, here it is.

    A recent study conducted by the Consumer Federation of America found that some insurance companies charge anywhere from 12% to 45% less for Auto Insurance to customers with a college degree. Also, drivers with graduate degrees or doctorates often pay even less than their bachelor’s degree counterparts.

    Does My Education Level Determine My Risk Level?

    Unsurprisingly, there are some who are upset that better educated drivers get lower car insurance rates. The CFA’s executive director, Stephen Brobeck, claims that the higher rates for people in working class jobs place an additional strain on the finances. This is because jobs that don’t require a college degree tend to pay lower wages. So, why exactly are insurers charging higher rates to less educated drivers? The answer is actually simple. Drivers with a lower education tend to be higher risk drivers. Before you argue, know that there are statistics to back up this claim.

    Facing The Facts

    car insurance rates and education levelTwo states, Maryland and New Jersey, convened lawmakers to take a closer look at the practices of certain insurers. They wanted to know specifically whether or not insurance companies were justified in differentiating premium amounts by education level. Both probes concluded that this practice lawful. They also concluded that the relationship between education and claims risk was sound. Simply put, insurance companies had the numbers to back up the assertion that more-educated drivers tend to file fewer and less-costly Auto Insurance claims.

    However, it should be emphasized that carriers determine Car Insurance rates from a wide range of factors that vary from customer to customer. These factors typically include driving record, driving experience and annual mileage. Those factors are usually weighed more heavily than a driver’s diploma or degree. In the Maryland study, it was revealed that education only resulted in a maximum difference of one pricing tier. Basically, the difference in premiums between a person with a college degree and another with a high school diploma wasn’t substantial. However, that difference can be relative depending on the driver and their financial situation.

    How Can I Lower My Car Insurance Rates?

    It looks like education level will continue to be a factor in determining Auto Insurance rates. So, how can drivers without a college degree lower their premium? Here are a few suggestions:

    • Look for Other Discounts. Unions, trade groups and auto clubs often offer discounted Car Insurance rates for their members.
    • Keep a Clean Driving Record. Accident and moving violation history is one of the top determinants for Auto Insurance rates. Always drive safely and responsibly.
    • Drive Fewer Miles. Cut your annual mileage by carpooling, taking the bus or train or telecommuting to your job. You’ll save money on your premiums as a result.
    • Adjust Policies. You can cut your Car Insurance costs by raising your deductible, dropping non-mandatory coverage or bundling policies with a single company.
    • Call AIS. Our Insurance Specialists shop multiple top carriers at once. Then you can choose the coverage that best suits your needs at a price that fits your budget. Call (855) 919-4247 for a free quote in minutes.

    This information is obtained from various sources. This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverages in a given policy may be different than those suggested here. Such policy will be governed by the language contained therein.