Car insurance pricing isn’t one-size-fits-all: it’s customized based on your age, gender, location, and even your education. That might sound arbitrary, but insurance companies pay close attention to any factors that could affect your driving record. Let’s dig into the connection between your education and your coverage.
Case studies: the influence of education on car insurance
Picture two folks on the hunt for car insurance – one with a high school diploma and the other with a college degree. Even if everything else about them is the same, the high school grad might be staring at higher insurance premiums. But why?
Studies suggest that drivers with lower levels of education are more likely to engage in risky driving behavior. They’re more prone to accidents, traffic violations, and a higher number of filed claims. It’s similar to how men often pay more for insurance than women in states that allow gender based pricing, or why younger drivers typically face heftier premiums than seasoned pros. Claims are expensive for insurance companies, so they raise premiums for riskier customers.
On the flip side, drivers with advanced degrees often enjoy lower insurance rates because they tend to keep a clean driving record and file fewer claims.
How much can you save with higher education?
Having a college degree could mean a break on your wallet when it comes to premiums. Of course, these ballpark figures vary based on your situation. Looking at this data, let’s compare the numbers:
How does education level affect your premiums?
Sure, the $34 gap between no degree and a master’s or PhD might seem minor. But these savings can add up over time. When you already need so many types of insurance, any way of lowering your premiums matters!
I have a college degree. How can I make the most of it?
If you have a college degree, congrats! You might already be reaping the benefits of lower car insurance rates. But do make sure your insurance agent knows about your education level so they can check that you get any education discount you’re eligible for.
Does your education affect the price of rental car insurance?
If you buy rental car insurance at the counter, oddly, you won’t usually get a discount for your education. This is because rental car insurance isn’t usually individually rated - it would take forever at the counter if that were the case. Instead, rental car insurance pricing is simply set quite high, and deemed good enough for all licensed drivers.
This is why if you rent cars for personal use frequently and you don’t have car insurance of your own, you should consider a non owner auto policy to cover your liability. Pair that with coverage for the car as a premium credit card benefit, or buy just the physical damage coverage at the counter.
In the driver’s seat of your education and insurance
Just like how education shapes your career, relationships, and life trajectory, it also leaves its mark on your car insurance. Keep in mind that there’s no guaranteed difference – the savings will depend on your circumstances and insurance provider. Still not sure why education matters for car insurance? Need help sorting through the options? Give us a call! Our insurance experts will be happy to help.