Some days, it feels like adulthood throws you one problem after another that you never thought about as a child. Car insurance tends to fall into that category.
Auto insurance isn’t an expense anyone enjoys paying. When you’re in that dreaded “high risk driver” category, though, it takes a whole other turn.
It can be a challenge to find coverage at all, despite the fact that the law requires it. When you do find coverage, the cost can be downright crazy.
How do you know if you’re in that high risk category? There are a variety of ways insurance providers evaluate a driver. To find out if you’ll need a car insurance for bad record, check out this list of common criteria:
Circumstances That May Require High Risk Auto Insurance
There are insurance companies that specialize in insuring high risk drivers without breaking the bank. The first step, though, is finding out if that’s what you need to look for. You could be a high risk driver if you meet any of the following criteria:
New Driver Status
It seems like a cruel joke that you’re a high risk drive right off the bat, but it makes sense. After all, people with less experience are more likely to get into an accident, and insurance companies are trying to protect their bottom line.
Keep in mind that a new driver will have higher rates no matter what age you are.
While many of us have gotten tickets we don’t think were justified, the insurance company sees them as signs of risky driving. Citations will affect your auto insurance in different ways.
Citations stay on your driving record for insurance purposes for three years in most cases. If you have one ticket within that time frame, it may raise your rates to a small degree. It won’t put you into the high risk category, though. That doesn’t tend to happen until you have multiple tickets within three years.
The impact a ticket has will depend on how serious it is. Most states have a point system. Each citation adds points to your license, and the more serious the offense, the more points it adds. For example, illegal street racing will carry more points than a ticket for driving 70 mph in a 60 mph speed zone.
In most cases, six points on your license in three years will put you in the high risk category. However, this can vary by state and by insurance carrier.
DUI or DWI Convictions
One of the worst things you can do for your car insurance is to drive drunk. The best case scenario is that you’ll be convicted of DUI (driving under the influence) or DWI (driving while intoxicated). That alone will put you in the high risk category for three years and bring a massive insurance increase. Matters will be even worse if you cause an accident.
It’s no surprise that a driver with a DUI is considered to be high risk. However, did you know that boating under the influence can have the same effect? In many states, a BUI conviction will affect your driver’s license. In some cases, it’s treated the same as a DUI.
At Fault Accidents
For obvious reasons, your insurance rates will go up if you cause an accident. Chances are that one at-fault accident won’t put you in the high risk category. Each accident stays on your record for three years in most cases, though. If you cause another accident within those three years, you could become a high risk driver.
Not all accidents will have the same impact on your insurance status. It may depend on the physical injuries the accident caused or the amount of property damage involved.
Drivers in Certain Age Groups
It might seem discriminatory, but the fact is that drivers in certain age brackets have higher accident rates than others. For that reason, insurance companies may classify you as high risk based on your age alone.
In particular, this is true for drivers under age 25 as well as those over age 70. The high risk classification relates to the number of accidents and severity of accidents for these drivers.
For instance, take a look at the accident rates by age groups. It’s clear that young drivers have higher accident rates overall. While older drivers don’t have much higher accident rates than other age groups, their rate of serious and fatal accidents are far higher.
The circumstance can vary based on each driver’s insurance situation. If a parent adds a teenage driver to their policy, they may not qualify for “high risk insurance” per se, because the other drivers are low risk. However, they can expect their premiums to go up a hefty amount.
Serious Traffic-Related Charges
In some cases, a car accident could lead to criminal charges as well. For example, a driver who causes a serious crash could be charged with serious injury by vehicle or vehicular homicide. For the most part, one serious charge like this is enough to classify you as a high risk driver.
When an insurance company evaluates your risk, they’re not just looking at the risk of a payout. They’re also looking at the risk that you won’t pay your premiums. That’s where credit comes into play.
A good credit score is considered anything above 670 in general. If your credit score is lower than this, you may be in the high risk category for auto insurance. However, every insurance provider has their own credit criteria, so that threshold will vary.
Gap in Insurance Status
Another indicator for a high risk driver is a gap in your car insurance. Perhaps your insurance policy lapsed due to non-payment. Maybe you canceled your last insurance policy before getting another one, or your last insurance company dropped you.
Regardless of the reason, a gap in your insurance coverage could classify you as high risk.
There are plenty of reasons a driver could make an insurance claim that don’t relate to an at-fault accident. Extreme weather might damage your car. Another unfortunate possibility is a hit and run, because you can’t file a claim against the other driver’s insurance in you don’t know who they are.
While they may not be your fault, too many claims can add up to a high risk classification. If you file multiple claims within three years, you might end up paying more than the average car insurance cost.
This is why some people choose not to file an insurance claim. Your insurance company might raise your rates enough that you’ll pay more than you would if you handled the expense out of pocket.
Select Criminal Convictions
In some states and for some insurance companies, specific criminal convictions will affect your car insurance. For example, if you’re charged with carrying an open container of alcohol where it’s illegal, that might affect your insurance classification.
Many insurance companies consider drug possession charges as well. If you use drugs, they consider you at high risk for driving under the influence. This isn’t a hard and fast rule, but it’s a possibility to consider.
Certain Types of Cars
It makes sense that the more money it would cost to replace your car, the more your insurance company will charge to insure it. Some cars, however, will raise you into the high risk category.
For the most part, this applies to sports cars, exotic cars, collectible cars, and high-performance cars. Some insurance companies do this because they think if you have a high-performance car, you’re more likely to speed and crash. These cars are also more expensive to repair, so even minor accidents will cost the insurer more.
Before you buy a car, it’s a good idea to find out how much the insurance would cost. If you provide the VIN (vehicle identification number), most insurers will be able to give you an estimate.
What Should I Do if I’m Considered a High Risk Driver?
If you meet any of the above criteria for a high risk status, the good news is that now you know. Your first step is to look for high risk auto insurance you can afford.
Shop around to various companies, but don’t trust them if they give you a quote without checking your driving record.
The next step is looking for ways to reduce your risk factors. In some cases, you can expunge your citations if you complete a traffic school or other requirement. Many insurance providers will also lower their rates for a senior citizen or young driver if they complete certain courses.
It’s also important to fight any citations that are questionable. Spending a little time in court could save you hundreds or thousands if the citation is dismissed.
Overall, the biggest factor that helps your driving record is time. Be extra cautious to avoid additional tickets and accidents so you’re back to a clean record in three years.
For more tips about your personal finances and expenses like auto insurance, check out our personal finance blog.