Low income auto insuranceIn today’s economy, it seems the rich are getting richer while the middle class is struggling just to get by.  Wages have remained stagnant for nearly a decade, while the cost of goods and services have gone up each year.  For most middle-class families, two jobs are needed just to get by and pay the bills.  It’s also frustrating for many lower income workers that they pay more in taxes than the top 1% of the rich.  This is because the rich often are taxed on long-term capital gains, while poorer working families pay much higher rates.  Basic services like auto insurance are also difficult to fit into many struggling families budget.

Rates for low income car insurance are often higher than those charged to higher income customers.  This is because many people that earn less have credit issues and live in more urban areas that cost more to insurer.  It is a frustrating statistic, but people who take home less than $50,000 annually have some of the highest premiums of any wage bracket.  If you are in the lower income bracket and need auto insurance for less, don’t worry, there are steps you can take to save money.  Get quoted with the cheapest direct rates at allied insurance online.

How Income Affects your Insurance Costs

It may be frustrating to you that hard-working, loyal Americans are paying more for car insurance than high net individuals.  Even for excellent drivers making less than $50K yearly, they almost always pay more for coverage than earners making over $100,000.  This sounds like discrimination and an unfair practice by big insurance companies, but the trend will no doubt continue for the foreseeable future.  Just take a look at any automobile insurance application.  Do you see how many questions pertain to a person’s finances?  There are numerous financial measurements insurers use to calculate your risk.  Some of the most common ones include:

*  Your Yearly Salary

*  Do you Rent or own a Home

*  Are you a salaried employee, self-employed or paid by the hour

*  Your Education – including Degrees earned

*  Your Credit Rating  

When you apply for a quote, you are probably surprised by all of these personal questions about your life and finances.  Most have nothing to do with your driving abilities but are all there for specific reasons.  Car insurers use complicated algorithms to determine how risky you are and how much you should be charged for coverage.  These days, more and more lower income households are paying more for basic car insurance policies.

One recent insurance cost study found that “blue collar” workers were charged as much as 50% more for the same exact coverage than “white collar” workers.  In some parts of the U.S., the gap is even greater and puts auto insurance out of reach of many families on a fixed budget.  Stats show that these “blue collar” workers get into more accidents and file more claims, so insurers pass along those costs, to this class of motorists.  While it may be frustrating if you fit into this category, there are things you can do to get better rates.

Low Income Motorists can get Cheaper Auto Insurance

So you don’t make a lot of money, but you still need a good automobile ins policy.  There is hope for you, so don’t panic.  The first thing you need to do while searching for low income car insurance is go online.  Some of the best rates will be found on-line, nd it really is faster than you think.  At sites like allied auto insurance, you can compare up to 10 quotes in only about five minutes.  Buying a direct policy can save you 10% or more.  The other thing that you can do is apply for multiple insurance discounts.  This means military, good driver and so on.  Taking advantage of discounts can save you 10% and even more.  Another tip is to not get wasteful options added on, like towing and rental insurance.  Chances are if you have a credit card, you are already covered anyway.  Get your free direct quote online with allied insurance company and save up to 40% on coverage.