Why does your commute affect the cost of your auto insurance?

If you’ve recently moved or changed jobs, you might be worried about the affect your new commute will have on your auto insurance policy. Although the change might be small, it is always possible that a change to your routine will cause your premiums to rise or fall.

This is why an increase to the length of your commute will result in higher insurance premiums.

Increased chance of accident

The most likely reason your auto insurance will increase if your commute gets longer is that your likelihood of being involved in an accident will increase. As with all types of insurance, the riskier the insurance company considers you, the more it will charge you for insurance coverage.

People with longer commutes aren’t inherently worse drivers. However, people with longer commutes do spend more time on the road. By extension, these long-distance commuters are increasing the likelihood that they will get into an accident simply because they are driving for a longer amount of time. If you drive an hour to work each morning, it is hard to argue that you're less likely to be involved in a collision than someone who drives five minutes.

How to absorb the insurance cost of commuting?

So what’s the solution? It’s unreasonable to suggest you quit your job to work near your home (although that would help), but there are some things you can do to lower your rates.

First, you can pay the increased auto insurance rates and hope that the savings garnered from moving further from your workplace are enough to offset your increase.

Second, you can reduce the distance you drive on your commute by taking public transit. By only driving to the local bus or train station, you can dramatically reduce the amount of time that you’re on the road, which could lead to lower auto insurance rates. Plus, you’ll have more free time to read or listen to podcasts without needing to pay attention to the road for hours every day.

Third, you can ask your workplace if telecommuting is an option, even if it’s only for one or two days a week. Similarly, if you have co-workers who live in your area, you can try to set up a carpool. By reducing the number of days you spend commuting, you will lower your total commuting kilometres. Reducing the number of kilometres you drive each year could have a big positive impact on your auto insurance cost.

Finally, if you’re able, consider giving up your vehicle for commuting purposes all together. By declaring your vehicle a “pleasure vehicle,” you can benefit from some of the lowest insurance rates available. To get to work, you can try a combination of walking, public transit, biking or carpooling.

If you find your auto insurance rates unaffordable, or have recently experienced an auto insurance rate increase, consider reducing your commute. By spending less time on the road, you are reducing the likelihood of an accident, which could result in a lower auto insurance cost.

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