How Education Level Impacts Car Insurance Rates | Get a Free Quote

Did you know that your level of education can affect how much you pay for car insurance? It may seem unfair, but car insurance companies use education level as one of the factors to determine your risk profile and premium. In this article, we will explain how education level impacts car insurance rates and how you can save money regardless of your education level.

How Education Level Affects Car Insurance Rates

Car insurance companies use education level as a proxy for risk, based on historical data and statistics. According to a study performed in Maryland and New Jersey, more educated drivers tend to file fewer claims1. While more educated people may not necessarily be better drivers, research indicates that they are less likely to drive under the influence, disobey traffic laws, be involved in a car accident, or drive uninsured1. They are also more likely to own a home and have multiple vehicles, which allows them to qualify for additional bundling and car insurance discounts1.

On the other hand, car insurance companies deem less educated people as high-risk clients. The likelihood of unsafe driving behavior and more insurance claims equates to higher rates and insurance costs for these individuals1. Again, this doesn’t necessarily mean that they are worse drivers. It’s simply a result of the historical statistics that insurers have accumulated.

How much does education level affect car insurance rates? The numbers vary by state, company, and policy, but here are some examples of average monthly rates by education level:

• Liability Only: A high school dropout pays $102, while someone with a master’s degree pays $941.
• Full Coverage: A high school dropout pays $198, while someone with a master’s degree pays $1911.

As you can see, the difference is not huge, but it can add up over time. Generally, as you get more degrees, the savings start to decline2. For example, someone with a Ph.D may only pay $50 less for car insurance than someone with a master’s degree2.

How to Lower Your Car Insurance Rates Regardless of Your Education Level

If you think that your education level is unfair or discriminatory, you may be wondering how you can lower your car insurance rates. The good news is that education level is not the only factor that affects car insurance rates, and there are many ways to save money on car insurance. Here are some tips and strategies to lower your car insurance rates, regardless of your education level:

• Compare quotes from different car insurance companies. Different companies may have different ways of calculating your risk and premium, so shopping around can help you find the best deal for your situation. You can use online tools like Compare.com or CoverHound to compare quotes from multiple providers in minutes13.
• Bundle your policies. If you have more than one type of insurance, such as home, renters, life, or health, you may be able to save money by bundling them with the same company. Many car insurance companies offer discounts for customers who have multiple policies with them1.
• Drive safely and avoid accidents. One of the most important factors that affect your car insurance rates is your driving record. If you have a history of accidents, violations, or claims, you will pay more for car insurance than someone with a clean record. To lower your risk and your rates, drive safely and obey the traffic laws. You may also qualify for discounts if you take a defensive driving course or install a telematics device in your car that monitors your driving behavior1.
• Choose a cheaper car. The type of car you drive also affects your car insurance rates. Some cars are more expensive to insure than others, depending on factors such as the make, model, year, safety features, repair costs, theft rates, and performance. Generally, newer, fancier, and faster cars cost more to insure than older, simpler, and slower cars. To save money on car insurance, choose a car that is cheap to buy, maintain, and repair1.
• Increase your deductible. Your deductible is the amount of money you have to pay out of pocket before your car insurance kicks in when you file a claim. The higher your deductible, the lower your premium. However, this also means that you will have to pay more if you have an accident. Therefore, you should only increase your deductible if you can afford it and if you have a good driving record1.

Frequently Asked Questions (FAQs)

Here are some frequently asked questions (FAQs) and their answers about education level and car insurance rates:

• Why do car insurance companies use education level as a rating factor? Car insurance companies use education level as a rating factor because they believe that it reflects your risk profile and likelihood of filing claims. They base this on historical data and statistics that show a correlation between education level and claims frequency1.
• Is it legal for car insurance companies to use education level as a rating factor? It depends on the state. Some states, such as California, Hawaii, Massachusetts, Michigan, Montana, North Carolina, Pennsylvania, and Utah, prohibit car insurance companies from using education level as a rating factor4. Other states allow it but may have some regulations or restrictions on how it can be used4.
• How can I find out if my car insurance company uses education level as a rating factor? You can ask your car insurance company directly or check their website for their rating factors. You can also compare quotes from different companies and see how they vary by education level1.
• How can I change my education level on my car insurance policy? If you have completed a higher level of education since you bought your car insurance policy, you may be able to lower your rates by updating your information with your car insurance company. You may need to provide proof of your education level, such as a diploma or a transcript1.
• How much does education level affect my car insurance rates compared to other factors? Education level is not the most important factor that affects your car insurance rates. Other factors, such as your driving record, credit score, location, age, gender, marital status, coverage options, and discounts may have a bigger impact on your rates than education level1.
• How can I get cheaper car insurance without changing my education level? There are many ways to get cheaper car insurance without changing your education level. Some of them include comparing quotes from different companies, bundling your policies, driving safely and avoiding accidents, choosing a cheaper car, increasing your deductible, and taking advantage of discounts1.

Conclusion

In conclusion, education level can affect how much you pay for car insurance rates. Car insurance companies use education level as a proxy for risk based on historical data and statistics. More educated drivers tend to pay less for car insurance than less educated drivers because they file fewer claims and qualify for more discounts.

However, education level is not the only factor that affects car insurance rates. There are many other factors that influence your risk profile and premium. There are also many ways to save money on car insurance regardless of your education level.

If you want to find out how much you can save on car insurance with your current education level, request a free quote from us today. We will compare quotes from multiple car insurance companies and help you find the best deal for your situation. Don’t let your education level stop you from getting affordable and reliable car insurance.