Car Insurance for Graduate Students: What You Need to Know

If you are a graduate student, you may have a lot of things on your mind: your studies, your career, your finances, and more. But have you thought about your car insurance? Car insurance is not only a legal requirement in most states, but also a smart way to protect yourself and your vehicle in case of an accident or theft. However, finding the best car insurance for graduate students can be challenging, especially if you are on a tight budget or have limited driving experience. In this article, we will explain what car insurance is and how it works, why it is important for graduate students, how to save money on car insurance as a graduate student, and answer some frequently asked questions about car insurance for this group. We will also provide some recommendations on the best car insurance companies for college students based on web search results.

Car Insurance for Graduate Students

Car insurance is a contract between you and an insurance company that covers you against financial losses in case of an accident or theft involving your vehicle. You pay a premium (a monthly or annual fee) to the insurer, and in return, they agree to pay for your damages or liabilities up to a certain limit. There are different types of car insurance coverage, such as:

• Liability coverage: This covers the medical expenses and property damage of other people if you are at fault in an accident. It is mandatory in most states.
• Collision coverage: This covers the repair or replacement of your vehicle if it is damaged in an accident with another vehicle or object. It is optional but usually required if you have a loan or lease on your vehicle.
• Comprehensive coverage: This covers the repair or replacement of your vehicle if it is damaged by something other than a collision, such as fire, vandalism, theft, or natural disasters. It is optional but usually required if you have a loan or lease on your vehicle.
• Personal injury protection (PIP) or medical payments (MedPay) coverage: This covers your medical expenses and lost wages if you or your passengers are injured in an accident, regardless of who is at fault. It is mandatory in some states and optional in others.
• Uninsured/underinsured motorist (UM/UIM) coverage: This covers your medical expenses and property damage if you are hit by a driver who has no insurance or not enough insurance to cover your losses. It is mandatory in some states and optional in others.

Car insurance is important for graduate students because it can protect you from financial hardship and legal trouble in case of an accident or theft involving your vehicle. Without car insurance, you may have to pay for the damages or injuries out of your own pocket, which can be very expensive and stressful. You may also face fines, penalties, or even jail time if you are caught driving without insurance or with insufficient coverage. Additionally, car insurance can give you peace of mind and confidence when you are on the road, knowing that you are covered in case of an unexpected event.

However, car insurance can also have some challenges or drawbacks for graduate students, such as:

• High premiums: Graduate students tend to pay more for car insurance than older or more experienced drivers, because they are considered riskier by insurers. According to web search results, the average cost of adding a driver age 18-21 to a car insurance policy is $1,399 per year. 6 This can be a significant expense for students who have limited income or savings.
• Limited options: Graduate students may have fewer choices when it comes to car insurance providers, policies, or coverages, because some insurers may not offer services to this group or may charge higher rates or impose stricter requirements. For example, some insurers may not offer rideshare insurance, which is useful for students who drive for a Transportation Network Company (TNC), such as Uber or Lyft.
• Complex situations: Graduate students may face some complex situations when it comes to car insurance, such as moving to a different state, changing vehicles, or staying on their parents’ policy. These situations may affect their car insurance rates, coverage, or eligibility, and they may need to update their information or switch providers accordingly.

Therefore, graduate students need to be careful and smart when it comes to car insurance. They need to find the best car insurance for their needs and budget, and take advantage of any discounts or savings opportunities that are available to them.

How to Save Money on Car Insurance as a Graduate Student

There are several factors that affect car insurance rates for graduate students, such as:

• Age: Younger drivers tend to pay more for car insurance than older drivers, because they are considered less experienced and more prone to accidents. According to web search results, drivers under 25 pay an average of $2,130 per year for car insurance, while drivers over 25 pay an average of $1,427 per year. 7
• Location: Car insurance rates vary by state, city, and even zip code, depending on the laws, regulations, traffic conditions, crime rates, and weather patterns in each area. According to web search results, the most expensive state for car insurance is Michigan, with an average annual premium of $3,096, while the cheapest state is Maine, with an average annual premium of $965. 8
• Driving history: Drivers who have a clean driving record with no accidents, tickets, or violations tend to pay less for car insurance than drivers who have a poor driving record with multiple incidents. According to web search results, drivers who have one at-fault accident on their record pay an average of $612 more per year for car insurance than drivers who have no accidents. 9
• Vehicle type: The make, model, year, and value of your vehicle affect your car insurance rates, because they determine how much it would cost to repair or replace your vehicle in case of an accident or theft. Generally speaking, newer, more expensive, and more powerful vehicles cost more to insure than older, cheaper, and less powerful vehicles. According to web search results,

the most expensive vehicle to insure in 2021 is the Tesla Model S Performance AWD electric sedan ($4,143 per year), while the cheapest vehicle to insure in 2021 is the Honda CR-V LX ($1,333 per year). 10

Given these factors that affect car insurance rates for graduate students, there are some ways to lower car insurance costs as well. Here are some tips:

• Compare quotes: One of the best ways to save money on car insurance is to shop around and compare quotes from different providers. You can use online tools or websites such as EverQuote’s secure site to get free quotes from participating partners in minutes. You can also contact local agents or brokers who can help you find the best deals and discounts for your situation.
• Choose a higher deductible: A deductible is the amount of money you have to pay out of your own pocket before your insurer pays for your claim. By choosing a higher deductible (such as $500 or $1,000 instead of $250), you can lower your premium (the amount of money you pay to your insurer every month or year). However,

you should make sure that you can afford to pay the deductible in case of an accident.

• Take advantage of discounts: Many car insurance companies offer discounts for various reasons, such as being a good student, having a good driving record, having multiple policies or vehicles with the same provider, taking a defensive driving course, installing safety or anti-theft devices on your vehicle, and more. You should ask your insurer or agent about the discounts that are available to you and how to qualify for them.
• Adjust your coverage: Depending on your needs and preferences, you may be able to save money on car insurance by adjusting your coverage levels or types. For example, you may be able to drop collision or comprehensive coverage if your vehicle is old or has a low value, or you may be able to increase your liability limits if you have assets or income to protect. However, you should make sure that you have enough coverage to protect yourself and your vehicle in case of an accident or theft.
• Drive safely and responsibly: One of the simplest and most effective ways to save money on car insurance is to drive safely and responsibly. By avoiding accidents, tickets, or violations, you can maintain a clean driving record and lower your risk of filing a claim. This can help you qualify for lower rates and discounts from your insurer.

In addition to these tips, you may also want to consider some of the best car insurance companies for college students based on web search results. Here are some of our recommendations:

• American Family: This company offers a Smart Student Discount of up to 25% for those who maintain a B average, successfully complete the teenSMART educational program, or attend college at least 100 miles from where their car is garaged. It also offers a Milewise Program that bases premiums on the number of miles you drive per month, which can save money for students who live on campus.
• GEICO: This company offers a Good Student Discount of up to 15% for those who maintain a B average or better. It also offers a Student Away at School Discount of up to 20% for those who attend college at least 100 miles from home and do not have regular access to their vehicle.
• State Farm: This company offers a Good Student Discount of up to 25% for those who maintain a B average or better. It also offers a Student Away at School Discount of up to 16% for those who attend college at least 100 miles from home and do not have regular access to their vehicle.
• USAA: This company offers a Good Student Discount of up to 10% for those who maintain a B average or better. It also offers a Family Discount of up to 10% for those who remain on their parents’ policy after graduation. However, USAA is only available to military members and their families.

Frequently Asked Questions (FAQs)

Here are some of the most common questions that graduate students may have about car insurance, along with their answers:

• Do I need car insurance if I don’t own a car? If you don’t own a car, you may not need car insurance. However, if you borrow or rent a car occasionally, you may want to consider getting non-owner car insurance, which provides liability coverage for any vehicle you drive that is not owned by you. This can protect you from being sued or paying out of pocket if you cause an accident while driving someone else’s car.
• Can I stay on my parents’ car insurance policy after graduation? If you are still living with your parents after graduation, you can usually stay on their car insurance policy as long as you are listed as a driver on their policy. However, if you move out of your parents’ home or buy your own car, you may need to get your own car insurance policy. You should check with your insurer or agent about the rules and requirements for staying on your parents’ policy after graduation.
• How does my credit score affect my car insurance rates? Your credit score is one of the factors that insurers use to determine your car insurance rates. A higher credit score indicates that you are more likely to pay your bills on time and less likely to file a claim. Therefore, insurers may offer you lower rates if you have a good credit score. Conversely, a lower credit score indicates that you are more likely to default on your payments or file a claim. Therefore,

insurers may charge you higher rates if you have a poor credit score. However, some states prohibit insurers from using credit scores as a factor in setting car insurance rates.

• What are the minimum car insurance requirements in my state? Each state has its own laws and regulations regarding car insurance requirements. You should check with your state’s department of motor vehicles (DMV) or insurance department (DOI) to find out the minimum amount of liability coverage that you need to drive legally in your state. You should also consider getting higher limits or additional coverages to protect yourself and your vehicle in case of an accident or theft.

• How can I get cheap car insurance with no down payment? Most car insurance companies require a down payment or a deposit when you sign up for a policy. This is usually a percentage of your annual or monthly premium that you have to pay upfront. However, some insurers may offer car insurance with no down payment or a low down payment for certain customers, such as those who have a good credit score, a clean driving record, or a long-term relationship with the insurer. You should shop around and compare quotes from different providers to find out if you qualify for car insurance with no down payment or a low down payment.

• What are some of the best car insurance discounts for graduate students? Some of the best car insurance discounts for graduate students are those that reward them for their academic achievements, their safe driving habits, or their loyalty to their insurer. Some examples of these discounts are:

  • Good Student Discount: This discount is offered by most insurers to students who maintain a B average or better in school. The amount of the discount varies by insurer, but it can range from 5% to 25% off your premium.
  • Student Away at School Discount: This discount is offered by some insurers to students who attend college at least 100 miles from home and do not have regular access to their vehicle. The amount of the discount varies by insurer, but it can range from 5% to 20% off your premium.
  • Multiple Policy Discount: This discount is offered by most insurers to customers who have more than one policy with them, such as car insurance and renters insurance. The amount of the discount varies by insurer, but it can range from 5% to 25% off your premium.
  • Multiple Vehicle Discount: This discount is offered by most insurers to customers who have more than one vehicle insured with them. The amount of the discount varies by insurer, but it can range from 5% to 25% off your premium.

Conclusion

Car insurance is an essential and smart investment for graduate students, as it can protect them from financial and legal troubles in case of an accident or theft involving their vehicle. However, finding the best car insurance for graduate students can be challenging, as they may face high premiums, limited options, or complex situations. Therefore, graduate students need to be careful and smart when it comes to car insurance. They need to compare quotes, choose a higher deductible, take advantage of discounts, adjust their coverage, and drive safely and responsibly. They also need to consider some of the best car insurance companies for college students based on web search results, such as American Family, GEICO, State Farm, and USAA.

If you are a graduate student looking for the best car insurance for your needs and budget, you should get a quote or compare rates from different providers today. You may be surprised by how much you can save on car insurance as a graduate student.