Do car insurance companies offer Federal Employee Discounts?
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UPDATED: Mar 13, 2020
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Government employees have multiple benefits available to them. In addition to comfortable benefits packages from their employers, they also qualify for discounts from many different types of companies. From restaurants to hotels and car rental companies, many places offer discounts to military personnel and federal employees. Some car insurance companies offer these discounts as well.
If you’re a federal employee, you should be sure to ask your auto insurance company if there are any discounts that you may qualify for. If not, you may be interested in checking with other insurance companies; you can obtain a quote from a company that’s known for its federal employee discounts and see if the price difference would make a switch worthwhile.
Why Federal Employees Get Discounts
Car insurance companies determine the cost of coverage based on the likelihood of a driver getting into an accident. People who have more accidents pay more for insurance, and this is calculated at both a personal level and a statistical one. General populations that have a lower risk of accidents will, as a rule, pay less for insurance than other groups, although individual policies will vary from one person to the next.
As a group, federal employees tend to have a lower risk of auto accidents than other people. This is determined on a statistical level, so it may not be true of all drivers, but it is a trend that insurance companies have identified. Insurers collect about all sorts of driving behaviors as a way to assess risk and calculate premiums, and some types of jobs are associated with lower risk than others. Government employees, scientists, teachers and computer programmers all tend to have lower premiums than other professions that are viewed as higher risk.
Military personnel especially have lower rates through many insurance companies because they often drive in lower-risk situations than others. They may confine most of their driving to military bases, where fewer accidents occur than open roads, and vehicles might not be driven for many months when someone is deployed.
Another reason why government employees may tend to pay less for auto insurance is because they overlap with other low-risk groups. For example, they may tend to have higher credit scores, and people with good credit pay less for car insurance. They are also a fairly small group when compared to other types of professions, so statistics can skew more easily in their favor. Regardless, most government employees do valuable work and are recognized through discounts from many types of industries, not just insurance.
Companies With Federal Employee Discounts
Perhaps the best known company to offer discounts to federal employees is Geico. In fact, that’s where the company got its roots; the name stands for Government Employee Insurance Company, and for many years it serviced only government workers. Focusing on such a low-risk pool of drivers helped the company grow, and when it began offering direct sales policies it was in a position to provide low-cost insurance to a wider population.
Another company with a similar background is USAA. This company provides low-cost car insurance to military personnel and their families. There is some talk of expanding and offering policies by invitation, but at present a driver must be in the military or directly related to someone in the military in order to obtain coverage. This small risk pool enables the company to provide much cheaper coverage than other insurers.
Although these two companies are best known for offering discounts to government employees, other insurance companies may offer as much as 10% off the cost of premiums. Be sure to inform your insurance company about your profession and be prepared to offer any information they may need, such as pay stubs or a military ID.
How to Get the Best Price on Insurance
Be sure to ask your insurance agent if there are any ways to reduce the cost of your insurance. Even if your insurance company does not offer a discount for government employees, you may still qualify for other types of discounts. Agents don’t always think to offer every discount you may be eligible for, so doing your own research and asking for assistance can help save money in the long run.
If your insurance company is unable to find discounts that will reduce your premiums, it might be a good idea to comparison shop for a new company. Drivers with a good driving history and decent credit should have a wide variety of affordable insurance policies available to them, so obtaining a quote online should introduce you to a number of companies that can provide coverage for a low price.