Cheap Auto Insurance When Unemployed in 2024 (Save Big With These 9 Companies!)

The lowest rates for for cheap auto insurance when unemployed are at Erie Insurance, followed by Geico and State Farm.

Some of the other best auto insurance companies for unemployed drivers are Progressive, Nationwide, and more.

However, which company is best for you depends on what rates and perks you are looking for.

Take a look below to see which company for unemployed drivers fits your needs best.

Our Top 9 Company Picks: Cheap Auto Insurance When Unemployed

Read on to find cheaper car insurance for unemployed drivers, from the cheapest companies to discount savings. You can also compare quotes from the top insurers by entering your ZIP code above.

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#1 – Erie: Top Pick Overall

Pros

• Great customer service ratings: Erie has great customer satisfaction ratings, including for claims handling.
• Affordable rates: Erie has the best cheap car insurance for unemployed drivers. Learn more about Erie’s affordable rates in our Erie auto insurance review.
• Policy perks: Erie offers perks in its standard coverages that aren’t typical at most providers, such as pet injury coverage of up to $500 per pet ($1,000 total) if your pet is injured in an accident.

Cons

• Availability is limited: Erie is not available in every state, so some unemployed drivers may not be able to get coverage at Erie.
• Stricter eligibility process: Erie’s low rates are partly due to its stricter underwriting process, which means it may be harder for high-risk drivers to qualify for Erie coverage.

#2 – Geico: Best for Online Convenience

Pros

• User-friendly: Geico’s apps are well-rated, and its website is easy to navigate, making it simple for drivers to manage their policies. For example, unemployed drivers can easily reduce coverage limits to lower rates.
• Multiple coverage options: Geico offers multiple types of coverage and limits that unemployed drivers can customize to meet their budget. Learn more about coverage options in our Geico auto insurance review.
• Multiple discounts: There are plenty of Geico auto insurance discounts for unemployed drivers to choose from.

Cons

• Mixed claims handling reviews: Geico has some negative claims handling customer service reviews, although this is typical of any large auto insurance company.
• Location rates vary: Geico is generally one of the cheapest auto insurance companies available, but in some regions is more expensive.

#3 – State Farm: Best for Local Agents

Pros

• Local agent network: State Farm is well known for its local agents, which is helpful for unemployed drivers who want in-person assistance with lowering rates.
• Multiple coverages: State Farm offers a great variety of auto insurance coverages, so drivers can pick and choose how much coverage they want. Learn more about State Farm’s coverage options in our State Farm auto insurance review.
• Multiple discounts: There is a good selection of State Farm auto insurance discounts that drivers can use to save on unemployed car insurance.
• Cheap for young drivers: Generally, State Farm offers affordable rates for younger drivers, particularly for college students.

Cons

• Customer service varies: State Farm has a few negative customer service reviews, so drivers may have a negative experience working with a specific agent.
• Fewer high-risk driver options: State Farm is not the best company for high-risk unemployed drivers, as it may deny coverage or charge high rates.

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#4 – Travelers: Best for Accident Forgiveness

Pros

• Multiple discounts: Travelers offers a good selection of discounts to drivers, including a usage-based discount through IntelliDrive (learn more in our Travelers IntelliDrive app review).
• Strong financial stability: Travelers has great ratings for financial stability, meaning it is well-established and can pay out claims without financial difficulty.
• Multiple coverages: Travelers has a good selection of auto insurance coverages, which you can learn more about in our Travelers auto insurance review.

Cons

• Local agents may be limited: Travelers doesn’t have as many local agents as companies like State Farm, so unemployed drivers may not be able to find in-person help.
• Region rates vary: Travelers’ rates vary by region like all auto insurance companies, so it may not be the most cost-effective choice in some states.

#5 – Progressive: Best for Budgeting Tools

Pros

• Name Your Price tool: Unemployed drivers can check the amount of coverage they can purchase with their budget from Progressive using the Name Your Price tool.
• Usage-based program: Drivers can save on unemployment car insurance with Progressive’s Snapshot program (learn more in our Progressive Snapshot review).
• User-friendly mobile use: Progressive’s apps and website are easy to use, making policy management for unemployed drivers easy.

Cons

• Customer service reviews mixed: Like all companies, Progressive has some negative reviews regarding claims handling customer service. Learn more in our Progressive auto insurance review.
• Accident rate increases: Progressive is a more expensive company for drivers with accidents, so if an unemployed driver gets into an accident, they will see much higher rates.

#6 – American Family: Best for Bundling Policies

Pros

• Bundling discounts: American Family bundling discounts can help drivers save. Read about other available discounts in our American Family auto insurance review.
• Great service ratings: American Family has good customer service ratings.
• Multiple coverages: American Family has a good selection of basic auto insurance coverages for drivers to choose from.

Cons

• Limited availability: American Family does not sell auto insurance in every state, so it’s availability is limited to unemployed drivers.
• Add-on coverages limited: While American Family has a good selection of basic coverages, it is missing a few add-on coverages like rideshare insurance or new car replacement insurance.

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#7 – Nationwide: Best for Roadside Assistance

Pros

• Multiple coverages: Nationwide’s coverage selection is great, with the option to add on extras like 24/7 roadside assistance.
• Strong financial stability: Nationwide has strong financial ratings, which you can learn more about in our Nationwide auto insurance review.
• Multiple discounts: There are plenty of Nationwide auto insurance discounts that unemployed drivers can take advantage of, such as usage-based discounts.

Cons

• Limited availability: Nationwide is unavailable in a few states, so it may not be an option for some unemployed drivers, depending on location.
• Mixed customer reviews: Nationwide has some mixed customer service reviews, like most larger companies.

#8 – Farmers: Best for 24/7 Support

Pros

• 24/7 assistance: Farmers offers 24/7 assistance with claims and policies so that unemployed drivers can get help at any time of the day.
• Good customer service reviews: Farmers has good customer service reviews regarding claims satisfaction (read more in our Farmers auto insurance review).
• Multiple discounts: There is a good selection of discounts to choose from at Farmers, including a usage-based discount through the Farmers’ Signal program (read more: Farmers Signal review).

Cons

• Rates vary by location: Farmers may not be the best choice for cheap car insurance for unemployed drivers in some states.
• No gap insurance: Farmers has a great selection of coverages and add-on coverages, but it is missing gap insurance.

#9 – Allstate: Best for Safe-Driving Discounts

Pros

• Usage-based discount: Allstate offers Drivewise, a usage-based program that can help unemployed drivers save on their auto insurance coverage (read more in our Allstate Drivewise review).
• Local agent availability: Allstate has local agents in some areas, so some unemployed drivers may be able to get in-person assistance with decreasing rates.
• Multiple coverages: Allstate’s coverage options are diverse, allowing drivers to carry as much or as little coverage as they wish.

Cons

• Higher rates for some demographics: Allstate’s rates are more expensive for high-risk drivers, so it may not be the most economical choice.
• Mixed customer reviews: Allstate has mixed customer service reviews, which you can learn more about in our Allstate auto insurance review.

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Unemployment and Auto Insurance Rates

Do you need a job to get auto insurance? No, your employment status can’t affect your ability to buy insurance. If an insurance company were to deny applications because their applicants were unemployed, the state regulating officials would penalize them.

Is there auto insurance for the unemployed in California? Not exactly, but California is one of the few states to have a low-income auto insurance plan.

How Auto Insurance Rates are Personalized

Auto insurance rates are personalized. This is why you, your friends, and your family members all pay very different premiums. Auto insurance carriers invest time and money into rate making. This helps the company determine how much they must charge to stay profitable.

After rates are made, the company will use rating factors to come up with a custom price for the coverage that you select when getting a quote from their website.

Each factor that’s used to personalize rates affects the policyholder’s probability of filing a claim based on what the statistics say. Some factors are beyond your control and others aren’t. Here are the most common rating factors used:

• Age, gender, and marital status
• Occupation
• Driving experience and driving record
• Claim history for at-fault and non-fault claims
• Mileage and driving habits
• Vehicle usage (pleasure, commute, or business)
• Garaging zip code and claims reported in the area
• Credit-based insurance score (only used in some states)
• Vehicle size, claims data, and safety features

According to the National Association of Insurance Commissioners (NAIC), your credit-based insurance score isn’t the same as your credit score. A credit-based insurance score is simply a calculation of risk of outstanding debt.

Unemployment as a Rating Factor

Your employment status isn’t a rating factor, but if you go from employed to unemployed, there are a few rating factors that can change. However, affordable car insurance for the unemployed isn’t out of reach. Shopping for coverage at one of the companies below will ensure you get the cheapest rate possible.

Since your income will be limited, it’s nice to know that your rates can go down when some of these factors change. That’s because you may qualify for some new mileage discounts and cheap usage-based auto insurance.

Usage-Based Discounts for Unemployed Drivers

When your annual mileage goes down your premiums can go down. Insurance companies have different mileage rating bands. The higher your annual mileage, the higher your premiums will be.

When you commute five days per week, you will accumulate miles over the weeks and months.

After you cut out that commute, your annual mileage will go down. If it goes down enough, you can qualify for a low-mileage discount. There are also other discounts that unemployed drivers can take advantage of to maximize savings.

Unemployed Driver Auto Insurance Discounts

These discounts vary by provider, but often offer big savings.

Unemployment and Change in Vehicle Usage

When you’re unemployed, your vehicle usage could change. Your agent will ask you how you drive your vehicle regularly. It might sound like a silly question depending on how it’s phrased, but what they’re inquiring about is whether or not you commute to and from work or school.

There are three usage categories. These include pleasure, commute, and business use. If you go from driving as a commuter or for business, you’ll see your rates drop when you become a pleasure user.

Unemployed Credit Score’s Effect on Auto Insurance Rates

If your credit score goes down, your rates may go up. Auto insurance and your credit score are important. A majority of states allow insurance companies to look at your credit when calculating rates. The company uses insurance scores that are calculated by an agency like FICO or LexisNexis to grade a person’s credit.

Learn more: How Credit Scores Affect Auto Insurance 

While delinquencies and credit mix will affect your score, there are factors that can’t be reported. One of these factors is employment status. The company can raise your rates at renewal if your credit score has gone down.

Covering your regular bills can be difficult when you’re living on a limited income or no income at all. If you’re looking to lower your bills, it’s important to shop around for the best rates. Make sure to update your rating information, solicit quotes, and then you can lower your monthly budget to cover your car.

Ready to find cheaper auto insurance if you are unemployed? Enter your ZIP code below to unemployed car insurance rates from multiple companies. Find the best car insurance company for the unemployed for you.

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