If you have received multiple driving violations, have had several accidents, have poor credit, or are over 65, you may be considered a high-risk driver by some insurance carriers, resulting in an increase in insurance costs. However, other, less common scenarios could also put you in the high-risk category.
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What Is High-risk Auto Insurance?
High-risk auto insurance is for drivers more likely to get into an accident and file a claim. This may include drivers who have a history of at-fault accidents or have at least one DUI conviction.
You will need to purchase a high-risk auto insurance policy if the insurer determines you are higher risk than typical drivers. As someone who needs high-risk auto insurance, you will, unfortunately, have to pay higher premiums than someone considered low-risk. There are many more high-risk drivers than ever before, so obtaining a high-risk insurance policy is not difficult.
Who Needs a High-risk Insurance Policy?
Anyone considered a high-risk driver, such as someone with multiple moving violations or a DUI, may need a high-risk or non-standard insurance policy. There are many factors that insurance companies consider when determining the risk factor of each driver. Many situations could deem you a high-risk driver, from driving records to credit and insurance coverage history.
Teenage or First-time Drivers
Indeed, a brand new driver will be considered high-risk since they are just learning to drive. A 16-year-old teenager with a brand new license or even a 40-year-old who just now decides to drive can be high-risk. However, there are some things they can do to help lower premiums.
If you have or are a teen driver, consider qualifying for a good student discount, taking a driving course, and avoiding getting tickets or accidents. If you are the parent of a new driver, you can add them to your policy since you are a low-risk driver.
Drivers 65 and Older
Just like a young and new driver can be considered high-risk, so can an elderly driver. Being over the age of 65 can qualify you as high-risk. Statistically, drivers over 65 cause a high number of fatal accidents compared to other drivers.
As we get older, our vision and reaction times can cause our driving to become unpredictable. If you are an elderly driver, be sure to see your doctor for your wellness visits to ensure your vision is sharp enough to continue driving.
Drivers With Lapsed Coverage
Something that should be avoided once you are first insured is having a lapse in insurance coverage. Regardless of the reason, it simply does not look good to the insurance company. Even if the lapse was only two weeks, they might still consider you a high-risk driver.
There may be a situation where you had a car previously but no longer do, and you stopped carrying insurance since you had no vehicle to insure. Or, perhaps you went away to school and didn’t need a car. If you do now, the insurance company may consider you high-risk for some time. The good news is as long as you continue to pay your premiums on time and have no accidents or tickets, your premiums will start to go down at each policy renewal.
Drivers With Poor Credit or No Credit
One factor that insurance companies consider, which may not always seem fair, is your credit score. If you have no credit, the insurance company can consider you high-risk, and you may need a high-risk auto insurance policy.
If you have bad credit, that can indicate to the insurers that you have difficulty paying your bills or don’t take your financial responsibilities seriously. You may have to pay more for your insurance if they consider you high-risk. It is unfortunate, but it can be temporary if you get your credit score back up.
Drivers With Moving Violations or At-fault Collisions
In 2019, car crashes that involved speeding from at least one driver were responsible for about 28% of all fatalities. This is up 2% from the year before. If you are a fast driver and have a few moving violations on record, you will be considered high-risk.
Many insurers will decline to offer you a policy if you have too many violations, so if you don’t want to pay an arm and a leg for car insurance, slow down and be a good driver. Be aware of your surroundings, and put your phone away when you are behind the wheel.
Drivers With Other Serious Violations or DUI Convictions
While it is no secret that drinking alcohol and then getting behind the wheel is illegal, let alone dangerous, if you get a DUI, you will be a high-risk driver and may even have difficulty obtaining insurance if you are a repeat offender.
Most insurers will look at a 5-year driving history. and even if your violation occurred 4 years prior, it does not matter to the insurer. At least for the next year, you will pay more for high-risk insurance.
How Long Are Drivers Considered High-risk?
A high-risk driver is likely to be considered risky for a longer period if they have multiple serious violations, like a DUI and a couple of speeding tickets. Additionally, getting in an accident could result in additional risk considerations.
One violation will not necessarily put you in the high-risk category, but avoiding any violation is best. Some insurance companies will only look at three years of your driving record, some will look at 5. So, it depends on what the insurance company decides for a timetable. Having a bad driving record doesn’t mean you will be high-risk forever, as long as you work on letting those violations fall off and not accruing new ones.
High-risk vs. Low-risk Drivers
As a high-risk driver, you will be considered by an insurer to have a higher chance of filing a claim. That means the insurance company wants to collect extra money upfront so that if they do have to pay out claims, they don’t lose a ton of money by insuring you. Unfortunately, if you have had violations, are young and a new driver, are elderly, have bad credit, or have let your insurance lapse, you may end up in this situation.
On the other hand, a low-risk driver may pay even less than a standard driver. Having a clean driving record, being an experienced driver under the age of 65 with no lapse in insurance coverage, and having good credit shows the insurers that you are responsible and are lower risk.
Low-risk drivers are more desirable and have an easier time obtaining car insurance. Most insurance companies will insure a low-risk driver, whereas some companies will not even consider a high-risk driver.
Where Can You Get a High-risk Policy?
If you are a high-risk driver, you may need to look outside your standard insurer to get a policy. While some well-known insurance companies offer high-risk auto policies, there are companies that specialize in only high-risk auto policies, which may be a better option and possibly more affordable.
The cause of your being a high-risk driver will factor into where you get a high-risk policy from. A standard insurer may consider you if you have bad credit but a good driving record and insurance history with no lapses. Remember that if you have one violation, they can non-renew your policy.
How Much Does Car Insurance Cost for High-risk Drivers?
You’ll pay different rates for high-risk auto insurance depending on where you live, but one thing to expect is it could be expensive. Several factors will be considered when the insurer is underwriting your policy, and determining premiums, such as your driving history, age, and credit score, also play a role.
With all of the above factors being considered, someone with multiple violations may pay more than someone with bad credit. A violation for a DUI will be considered more severe and high-risk than a violation for not using a turn signal.
How to Make High-risk Car Insurance More Affordable
Now that you understand you will be paying more than a low-risk driver with a standard policy let’s discuss some ways to keep it affordable. Of course, the goal is to be a low-risk driver and avoid needing high-risk auto insurance, but use these tips if you are high-risk.
Improve Your Credit Score
While some insurance companies don’t do a credit history check, most do. One of the best ways to ensure you pay less for car insurance is to improve your credit score. This can take time, so focusing on your credit year-round will benefit you in the long run.
Any bill that you pay late can affect your credit score. If you take out a loan, make sure you can pay it on time every month. Always pay your credit cards, and be sure to pay your medical bills, which can often be set up on a payment plan.
Take a Defensive Driving Course
Several discounts are available on any car insurance policy, but they can vary from insurer to insurer. One popular discount is for a defensive driving course. Take a course, and you may be eligible for a discount on your policy. Plus, it can never hurt to refresh your safe driving skills.
Maintain Good Driving Habits
The most obvious way to make sure you pay fewer premiums as a high-risk driver is to maintain a clean driving record. Be a safe driver at all times. Not only will this help you with your car insurance premiums eventually, but it will keep you and other drivers safe.
If there is a way for you to avoid driving as much, that could be a great option to ensure you start having a good driving history. It will avoid at-fault accidents and any violations that can come with them. Spending less time on the road will undoubtedly decrease your chances of becoming a more high-risk driver.
Maintain Active Auto Insurance Coverage
One of the best ways to remain lower-risk to an auto insurance company is by making sure you have a history of active coverage. Having a lapse in auto insurance shows irresponsibility. Even if you stopped needing a car, showing a history with a lapse will automatically make you a high-risk driver in the eyes of an insurer.