It’s an unfortunate fact that insurance companies often charge more to unemployed drivers.
Research by the BBC found that on average, car insurance for those without a job and thus with more leisure time was 30% higher than those in full-time work. In one example, it was as much as 60% higher.
From the insurance company's perspective, they argue that leisured drivers are more prone to causing accidents and also more likely to submit a claim, making them a far higher risk.
Some other reasons that are given by insurers for the high costs of premiums for the unemployed include:
Some of these points that have come from insurers are deeply argumentative, especially one which depicts the unemployed as potential criminals.
Nonetheless, statistics do prove that leisured people do submit more claims than their working contemporaries and thus the discrimination in costs seems somewhat justified.
The most valuable tip is to compare insurance quotes and not just accept the first quote you are given.
Other tips include:
Greater mileage means more time on the road and, consequently, a higher risk and higher premiums.
Try to remain within your mileage limit, as passing beyond it can mean you are not insured if an accident occured.
If you are close to the limit, contact your insurance company to discuss raising it with them.
Drop any unnecessary extras, such as legal expenses cover or a courtesy car, and concentrate on just being legal.
Moving from fully comprehensive to third-party insurance could save you a substantial amount. Just make sure it is always the best type of cover for you - getting a cheaper insurance policy may not cover you for what you want.
By having a black box fitted to your car which sends data to the insurance company, you can help gain trust and lower your risk – resulting in cheaper costs.
It doesn’t matter if you are employed or not, your car is likely an essential you cannot do without, but do you actually need the type of car you are driving?
Changing your car to one from a cheaper insurance group can save you money every year, even hundreds of pounds if the change is a big one.
There’s no need to be driving around in a luxury Lexus if you are no longer employed, and cutting back here can help get you through the month and take a chunk from your insurance with no real loss in mobility.
By voluntarily adding to your excess amount, you move more of the risk from the insurance company to yourself.
Remember, the excess is the amount you have to personally cover before the insurance company will pay a penny, so don’t fix it so high that an accident becomes financially devastating, but your premiums will lower with a higher excess.
While you are focussed on getting a job, it is easy to let other things slide, including remaining with your current insurer because switching is too much time.
However, if you keep an eye on your insurance costs you may be able to save yourself money by switching providers at an appropriate time.
Improve your security
If you can afford it, invest in improved alarm systems and an immobiliser for your car. Also, try to make sure it is parked in the safest place possible (and let the insurance company know) to lower its risk level overnight.
