When it comes to your premiums, you are what you do

Insurance companies are constantly looking for ways to assess the risk that decides insurance premiums. Admiral, the direct motor insurer, believes that the colour of the car is a determining factor; while Zurich looks to the stars for its clues, and claims that crashes correlate with birth signs.

But for as long as the industry can remember, the occupation of the policyholder has featured on car insurance proposal forms. You may live in the same district, and drive an identical car, but premiums vary dramatically depending on what you do for a living.

Your occupation also affects the cost of household insurance, and it is beginning to have an impact (along with age and gender) on what you pay for mortgage protection policies.

Occupations prone to sickness, accidents and especially redundancies can pay 20 to 30 per cent above average; secure occupations are charged similar amounts less than the norm.

But the biggest differences affect the cost of motor insurance. Here, Nineties-style political correctness goes out of the window, and happy families stereotypes take over: Miss Mouse, the librarian, is a safe driver; and Mr Glitz, the rock star, will drive his pink limousine into a swimming pool.

Actuaries - those chaps who make accountants look glamorous in comparison - decide how much of a risk you represent.

Even if you never use the car for work - they say - your job reflects your lifestyle. While no insurer looks only at occupation to calculate an insurance premium, it continues to be a deciding factor when underwriters agree to cover you - or not - and if so how much it will cost you.

Journalists, for example, find their premiums loaded because of their job. This is because the "typical" hack is pushy in pursuit of a scoop, works long, unsocial hours, and follows them by some long, hard socialising. And public relations types, their opposite numbers in the media, are tarred with the same brush.

At one end of the scale the safest professions, in the eyes of the insurance underwriters, are clerks, bank managers and teachers.

At the opposite extreme, musicians and night-club owners are viewed by insurers with deep concern. They are seen as highly emotional people who lead stressful and irregular lives, return from their job at dead of night, work amid a high consumption of drink and drugs and probably opt for unusual and attractive cars.

They are expected to have driving incidents that would seriously sully their claims records.

Also, if the policyholder is famous, insurance companies expect that he or she regularly gives lifts to other household names. An accident that injured a passenger who was a famous actress could have heavy financial repercussions if the accident ended a promising career, and cut off high earnings for life. The ensuing law suit could run to millions.

With such a high potential risk, insurers are likely to load the premium. The tables (right) show how premiums would differ from one occupation to another in two different examples.

Your job also affects household insurance premiums although the conection is somewhat more tenuous, and occupational premium loadings are relatively small for home and contents cover compared with car insurance.

For buildings cover, there is little discrimination among the professions.

Premiums are determined mainly by the size and rebuild costs of the house and geological factors such as the subsoil on which the house is built and the presence of underground springs or mines, so premiums are relatively constant.

There are some exceptions. Occupations that involve frequent or prolonged absences from home - such as airline staff, sports professionals, oil- rig workers or merchant seamen - are seen to leave their property more vulnerable to risk than a civil servant with regular working hours.

These characteristics may not be recognised in a loaded premium, attracting instead policy restrictions, such as a limited theft cover if the house is unoccupied for long periods.

One underwriter might take the view that a fine-art dealer is a high- theft risk, and that thieves may stop at nothing to get away with a valuable haul - even to the extent of using explosives to gain entry.

Likewise, a famous actress may entertain other famous people in her home, which could result in a high liability claim in the event of a tree falling on to the house, for example.

For contents cover, occupation can have more effect on premiums. Again, once the usual variables of postcode, number of bedrooms and quality of security alarms are taken into account, the householder's job can be a factor, influencing the chances of the house being occupied during the day and the prospect of high-value possessions in the house.

For example, on a 3-bedroom semi in Winchester worth pounds 85,000, and with contents worth pounds 30,000, a civil servant would pay pounds 74 for buildings cover and pounds 103 for contents.

A journalist would fare slightly worse at pounds 96 for buildings and pounds 103 for contents. But a rock star would be hammered for pounds 116 and pounds 228 respectively.

Taking another example, on a detached two-bedroom house in Chesterfield, Derbyshire worth pounds 35,000, with contents worth pounds 35,000, the figures would be pounds 112 and pounds 116 for the civil servant, pounds 119 and pounds 228 for the journalist, and pounds 125 and pounds 228 for the rock star.

The good news is that premiums are still going down, and, according to the AA's British Insurance Premium Index, you should now be paying around 5 per cent less for home insurance than this time last year, and about 4 per cent less for car insurance.

How your job affects motor premiums

A 25 year-old female, living in central London (SWI), with a clean driving record and a Ford Escort 1.4:

Bank worker pounds 395

Teacher pounds 395

Solicitor pounds 406

PR officer pounds 427

Journalist pounds 429

Model pounds 587

Actress pounds 818

A 55 year old male, living in Whitchurch, Hampshire (RG28), driving the same Ford Escort:

Bank manager pounds 168

Teacher pounds 177

Solicitor pounds 184

PR officer pounds 187

Journalist pounds 200

Model pounds 281

Actor pounds 377

BEFORE YOU RENEW YOUR INSURANCE

Do

Car

Restrict the number of drivers on your policy - and keep the under-25s away.

Get a smaller or older car.

Fit a security alarm, immobiliser, tracking device or even a simple steering lock - not only will they get you an insurance discount, they will also reduce the likelihood of the car being stolen or broken into.

Opt for a voluntary excess - but remember, you pay the first pounds 100 or pounds 200 of a claim.

Home

Fit locks on all windows and doors.

Have a burglar alarm fitted.

Get a Neighbourhood Watch scheme going.

Have someone who stays at home during the day.

Get a large dog.

Don't

Leave the car on the street overnight.

Accept the first quote you get - a broker may be able to get you a better deal than a direct writer, simply because they have access to a greater range of insurers.