Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates. He has also been featured on sites like UpJourney.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Dec 28, 2020

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Things to Remember

  • If you telecommute or have a shorter than average commute, you can receive auto insurance rates up to 5 percent lower than the national average.
  • Of the 22 largest insurance companies in the U.S., 18 offer low-mileage discounts.
  • A low-mileage discount can mean up to 30 percent off your auto insurance rates, depending on the company.

If you’ve ever called an insurance company for a quote on auto insurance, you know there are many different factors that affect auto insurance rates. One of the first questions an agent will ask you is how many miles you put on your car every year.

You may be wondering, can you cut your auto insurance rates by telecommuting? Or, what is the best telecommuting auto insurance company?

If you telecommute, or work from home, your auto insurance rates will be positively impacted. Statistics say the more you’re on the road, the more likely you are to be involved in an accident. Therefore, more driving means higher auto insurance rates.

If working from home results in a significant enough decrease in your annual mileage, you could see some massive auto insurance reductions.

Read through our guide to better understand why working from home can lead to a decrease in your auto insurance rates, and to learn how to best take advantage of the savings.

Can’t wait to find your cheaper telecommuting auto insurance premiums? For affordable auto insurance for telecommuters, enter your ZIP code into our FREE online tool above and get multiple auto insurance quotes so you’ll know how much you might pay for auto insurance.

Does telecommuting affect auto insurance rates?

If you telecommute but wonder how does annual mileage affect auto insurance, the answer might surprise you. Some companies will charge higher rates if you drive more than the national average, while others will not change your rates at all, no matter how often you drive.

According to Data USA, the average commute length is 25.7 minutes one way. The average American will drive around 14,000 miles per year. However, if you work from home, that number is likely to be much, much lower.

Auto insurance companies take a number of factors into consideration when adjusting your rates, and as we already noted, commute length is one of those.

So what is the best auto insurance if you work from home? It depends on a variety of factors, like your age, driving record, and what state you live in.

However, to help you estimate how much you might save on auto insurance by telecommuting, take a look at the data in the table below, which shows how your commute can affect your auto insurance rates, all else being equal.

Average Annual Auto Insurance Rates By Commute Length
Insurance CompaniesAverage Annual Rates for
10 Mile Commute
(6,000 Miles per Year)
Average Annual Rates for
25 Mile Commute
(12,000 Miles per Year)
USAA$2,482.69$2,591.91
Geico$3,162.64$3,267.37
State Farm$3,175.98$3,344.01
American Family$3,401.30$3,484.88
Nationwide$3,437.33$3,462.67
Progressive$4,030.02$4,041.01
Farmers$4,179.32$4,209.22
Travelers$4,399.85$4,469.96
Allstate$4,841.71$4,934.20
Liberty Mutual$5,995.27$6,151.63
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As you can see, commuting has some effect on rates. On average, longer commutes mean rates that are about 2.33 percent higher than shorter commutes. Though, as we mentioned above, different companies handle commute-based rates differently.

For example, State Farm has the highest average increase in this data set at 5.29 percent higher rates for longer commutes. By contrast, Progressive only increases rates by an average of 0.27 percent for longer commutes.

In addition to lower rates for lower annual mileage, some insurance companies offer low-mileage discounts. Take a look at this table to learn more about which of the major companies currently offer this kind of discount.

Low Mileage Auto Insurance Discounts by Company
Insurance CompanyOffers Low Mileage DiscountDiscount Percentage (if available)
21st CenturyNoN/A
AAAYesNot Available
AllstateYesNot Available
American FamilyYesNot Available
AmeripriseNoN/A
AmicaYes10%
Country FinancialYesNot Available
EsuranceYes15%
FarmersYesNot Available
GEICOYesNot Available
Liberty MutualYesNot Available
MetLifeYesNot Available
NationwideYesNot Available
ProgressiveYesNot Available
Safe AutoNoN/A
SafecoYes20%
State FarmYes30%
The GeneralYesNot Available
The HanoverYesNot Available
The HartfordYesNot Available
TravelersYesNot Available
USAAYesNot Available
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As you can see when you look at the data, we only have the discount percentage information for a few of the companies that offer this type of discount.

You’ll need to speak with your insurance agent to find out exactly what kind of discount you may qualify for if you’re a low mileage driver.

Even if your auto insurance company doesn’t offer a specific low-mileage discount, it’s worth calling them and informing them of the reduced number of miles you’re now driving if you work at home.

Some companies might lower your rates simple because you’re not driving during peak rush-hour traffic.

Remember, auto insurance discounts can stack on top of one another. Qualifying for as many discounts as possible is a great way to help you reduce the cost of your auto insurance.

To ensure you’re really paying your best premiums, you should also compare quotes from multiple companies before choosing a policy.

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Do you need auto insurance if you telecommute?

Working from home significantly cuts down the time you spend on the road, but you’ll still need auto insurance coverage in order to legally drive a vehicle. Just because you don’t commute for work, that doesn’t mean you never drive a car.

According to data reported by the Insurance Information Institute, auto insurance is legally required in 49 states, but 14 percent of American drivers are still uninsured.

The consequences of getting caught driving without insurance can range from a hefty fine, to getting your license and registration revoked, and even potential jail time.

Even if you’re a telecommuter, you don’t want to get caught driving without insurance on your way to the grocery store or while visiting friends or family. Make sure you have an active auto insurance policy that meets the minimum insurance requirements for your state.

What are those requirements? Find the details about the legal auto insurance minimums in your state in the table below.

Auto Insurance Minimum Legal Requirements by State
StatesMinimum BI & PD Liability LimitsRequired Insurance Policies
Alabama25/50/25BI + PD Liability
Alaska50/100/25BI + PD Liability
Arizona15/30/10BI + PD Liability
Arkansas25/50/25BI + PD Liability, PIP
California15/30/5BI + PD Liability
Colorado25/50/15BI + PD Liability
Connecticut25/50/20BI + PD Liability, UM, UIM
Delaware25/50/10BI + PD Liability, PIP
District of Columbia25/50/10BI + PD Liability, UM
Florida10/20/10BI + PD Liability, PIP
Georgia25/50/25BI + PD Liability
Hawaii20/40/10BI + PD Liability, PIP
Idaho25/50/15BI + PD Liability
Illinois25/50/20BI + PD Liability, UM, UIM
Indiana25/50/25BI + PD Liability
Iowa20/40/15BI + PD Liability
Kansas25/50/25BI + PD Liability, PIP
Kentucky25/50/25BI + PD Liability, PIP, UM, UIM
Louisiana15/30/25BI + PD Liability
Maine50/100/25BI + PD Liability, UM, UIM, Medpay
Maryland30/60/15BI + PD Liability, PIP, UM, UIM
Massachusetts20/40/5BI + PD Liability, PIP
Michigan20/40/10BI + PD Liability, PIP
Minnesota30/60/10BI + PD Liability, PIP, UM, UIM
Mississippi25/50/25BI + PD Liability
Missouri25/50/25BI + PD Liability, UM
Montana25/50/20BI + PD Liability
Nebraska25/50/25BI + PD Liability, UM, UIM
Nevada25/50/20BI + PD Liability
New Hampshire25/50/25Financial Responsibility only
New Jersey15/30/5BI + PD Liability, PIP, UM, UIM
New Mexico25/50/10BI + PD Liability
New York25/50/10BI + PD Liability, PIP, UM, UIM
North Carolina30/60/25BI + PD Liability, UM, UIM
North Dakota25/50/25BI + PD Liability, PIP, UM, UIM
Ohio25/50/25BI + PD Liability
Oklahoma25/50/25BI + PD Liability
Oregon25/50/20BI + PD Liability, PIP, UM, UIM
Pennsylvania15/30/5BI + PD Liability, PIP
Rhode Island25/50/25BI + PD Liability
South Carolina25/50/25BI + PD Liability, UM, UIM
South Dakota25/50/25BI + PD Liability, UM, UIM
Tennessee25/50/15BI + PD Liability
Texas30/60/25BI + PD Liability, PIP
Utah25/65/15BI + PD Liability, PIP
Vermont25/50/10BI & PD Liab, UM, UIM
Virginia25/50/20BI + PD Liability, UM, UIM
Washington25/50/10BI + PD Liability
West Virginia25/50/25BI + PD Liability, UM, UIM
Wisconsin25/50/10BI + PD Liability, UM, Medpay
Wyoming25/50/20BI + PD Liability
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If you rarely drive, you may be able to get away with purchasing a very basic policy that only meets the minimum requirements of your state.

A basic-policy will cost much less than a full coverage policy, however, you will not be covered in as many situations.

Most states only require you to purchase some form of liability insurance, which will pay for damage to the other driver in an accident you are at fault for.

If your vehicle is parked all day, you might want to add comprehensive coverage to your policy.

Comprehensive auto insurance protects your vehicle from damage when it is not in motion. This includes weather-related damage, vandalism, vehicle theft, and even damage from fires or flooding.

How much will a comprehensive policy cost you each year? Find your state in the table below to see the average annual cost for comprehensive auto insurance.

Average Annual Comprehensive Auto Insurance Rates by State
StateAverage Annual Comprehensive Coverage Auto Insurance Rates
Oregon$93.87
California$100.54
Hawaii$101.56
Maine$104.98
Washington$106.38
Utah$109.50
New Hampshire$110.77
Florida$116.53
Idaho$116.55
Nevada$117.63
Ohio$121.61
Indiana$122.06
Delaware$122.49
Vermont$125.48
Illinois$128.13
New Jersey$131.35
Connecticut$131.62
Rhode Island$132.19
Massachusetts$134.96
North Carolina$136.08
Virginia$136.54
Wisconsin$136.81
Alaska$137.26
Kentucky$141.39
Pennsylvania$144.21
Tennessee$148.45
Maryland$152.72
Michigan$154.85
Alabama$156.31
Georgia$159.18
New York$171.12
New Mexico$172.57
Colorado$174.61
South Carolina$180.94
Missouri$181.27
Iowa$183.53
Minnesota$184.27
Arizona$186.12
Arkansas$190.41
West Virginia$204.28
Texas$206.42
Mississippi$210.33
Montana$211.91
Louisiana$215.17
Oklahoma$225.84
Nebraska$229.25
North Dakota$231.04
District of Columbia$233.24
Wyoming$247.57
South Dakota$258.11
Kansas$267.91
U.S. National Average$148.04
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Comprehensive coverage is a great additional policy for telecommuters. There is a deductible associated with this type of policy. If you want lower monthly rates, consider increasing your deductible amount. Just be sure not to increase it too much.

You can also purchase a pay-per-mile policy, which will offer the same protections as a traditional policy, but charges you based on how many miles you drive per day.

Keep reading to learn more about pay-per-mile auto insurance and determine if it is the right option for you.

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What is pay-per-mile auto insurance?

Pay-per-mile auto insurance is another option for reducing your rates if you work from home. Essentially, you can purchase liability, comprehensive, and collision coverage for rates that are based on the exact number of miles you drive each day.

For this type of policy, the insurance company will charge you a very low monthly base fee. Then you’ll pay a certain amount for each mile you drive per day (usually it’s only a few pennies). However, the specifics will change depending on what company you use.

Even if you purchase a pay-per-mile policy, other factors besides the number of miles you drive will affect your base insurance rate, like your age, ZIP code, and driving record.

However, because you’re also being charged based on how far you drive per day, your rates will vary from month to month.

Currently, Nationwide, Allstate, Mile Auto, and Metromile offer this kind of coverage.

See more details about pay-per-mile programs currently on the market in the table below.

Pay-Per-Mile Program Details by Insurance Company
Insurance CompaniesLow-Mileage Program NameDevice UsedEnrollment Discount (Maximum Possible % Savings)Earned Savings (Maximum Possible % Savings)
AAAAAADriveMobile App15%30%
AllstateDrivewiseMobile App10%30%
American FamilyKnowYourDrivePlug-in5%20%
EsuranceDriveSenseMobile App5%30%
Liberty Mutual/SafeCoRightTrackMobile App or Plug-in5%30%
MetLifeMy JourneyPlug-in10%30%
NationwideSmartRidePlug-in10%40%
ProgressiveSnapshotMobile App or Plug-inaverage of $2520%
Mile AutoMile AutoNeitherN/A40%
State FarmDrive Safe & SaveMobile App or Plug-in5%50%
The HartfordTrueLanePlug-in5%25%
TravelersIntelliDriveMobile App10%30%
MetromileMetromileMobile AppN/A60%
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There are a lot of different pay-per-mile policy options for drivers to choose from when it comes to auto insurance. Working from home and saving money is a combo that just cannot be beat.

Just be mindful of what information the pay-per-mile trackers are collecting from you. Some companies only track the number of miles you drive. However, others will also look for how fast you drive, where you go, and other personal information.

Before signing your name on any dotted lines, make sure you are comfortable with all of the information you are sharing with the insurer. Read the fine print and never be afraid to ask questions about what the provider is tracking.

Metromile offers a well-rounded pay-per-mile program that is currently only available in Arizona, California, Illinois, New Jersey, Oregon, Pennsylvania, Virginia, and Washington.

For a monthly base rate of $29, plus a few pennies per mile, you can be insured for a much lower rate than a traditional policy. Metromile claims low-mileage drivers can cut their rates in half by switching providers.

There is also a cap for how much you’ll be charged per month. That way, you’ll still be able to take that road trip you’ve been considering without getting stuck with a massive auto insurance bill.

Keep in mind that pay-per-mile insurance policies are relatively new, and are only just now starting to be available in most states.

You will need to speak with a licensed insurance agent in your area to find out if this type of auto insurance policy is available to you.

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How to Ask Your Boss If You Can Work from Home

These days, working from home is becoming more and more normal.

Even auto insurance work from home policies are being implemented across the country, allowing many agents to telecommute. For example, there is currently a temporary Progressive work from home program in place.

If your company doesn’t currently have any telecommuters, you can professionally request a work from home schedule with your boss. You can suggest working from home on a trial basis so your supervisor and company can see that it won’t affect your productivity.

Be sure to mention how the company can benefit through reduced overhead, safer social distancing practices, and decreased carbon emissions. Some bosses respond well to data and factual evidence.

If your job is unable to commit to a full-time work from home schedule, you can talk to your boss about the possibility of telecommuting for just one or two days a week. You’d be surprised how many miles you can chop off of your annual average by staying home to work just one day out of the week.

If these suggestions do not convince your boss to let you work from home, keep an eye out for other telecommuting employment opportunities. You might also consider biking to work or taking public transportation.

If remote work is simply not an option for you, just remember that driving less miles per year in general can lower your auto insurance rates. Just remember to keep your insurer accurately informed about your annual mileage so your rates can be adjusted accordingly.

Can I lower my auto insurance rates if I’m unemployed?

It may be possible to reduce your insurance rates during periods of unemployment. However, some companies increase rates subtly if you are unemployed or a stay-at-home parent.

Denver7 news reported about how one stay-at-home mother noticed her auto insurance quote increase after she informed a provider about her employment status. When she changed her occupation, her quote suddenly decreased.

As you can see, your employment status can change your insurance quotes. If you’re unemployed, consider comparing rates from companies that do not ask about your work status. Also, remember to inform your insurance agent that you drive less than average.

Even if you’re driving to and from job interviews, it’s likely you’re on the road less frequently than if you’re driving to and from work every day. 

You can also talk to your insurance company to see if they’re willing to reduce your rates temporarily while you search for work. Better yet, try to find a job that will allow you to work from home and keep those lower rates permanently.

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Cut Your Auto Insurance Rates by Telecommuting: The Bottom Line

If you telecommute, make sure you’re getting the cheap auto insurance rates you deserve. You can either switch to a pay-per-mile insurance program, or receive low-mileage discounts for a traditional policy.

There are a few things to keep in mind when considering auto insurance and work from home jobs:

  • More and more companies are allowing employees to work from home.
  • Some insurance companies offer special telecommuter rates for those who work from home.
  • Low-mileage discounts and pay-per-mile policies can help you lower your auto insurance rates.

Now that you know you could save some money by working from home. If telecommuting is an option for you, be sure to inform your insurance company so you can take advantage of the savings.

Frequently Asked Questions: Cut Your Auto Insurance Rates by Telecommuting

Do you still have questions about auto insurance rates when you telecommute? Read through these frequently asked questions to learn even more.

#1 – What are the best auto insurance companies?

The answer to this depends on a number of factors, including your personal insurance needs, your age, where you live, and who else might be on your policy. However, comparing rates from the top auto insurance companies is a good place to start.

You can get quotes online to easily get started. Enter your ZIP code into one of our online tools to get telecommuting auto insurance quotes right now, or you can speak to insurance agents to find a policy that meets all of your needs.

#2 – How do I find the cheapest insurance?

The best way to find affordable auto insurance is to shop around and compare quotes. You should also do what you can to keep your rates low by driving safely and following the rules of the road.

Are you ready to buy telecommuting auto insurance?

Don’t wait to get the best telecommuting auto insurance rates. Simply enter your ZIP code into our FREE quote tool below to get started.