All About High-Risk Car Insurance
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Drivers who have had numerous accidents or DUIs may be considered high-risk from an insurance company’s standpoint. Such drivers have a more difficult time finding car insurance and may require a high-risk policy that comes with a higher-than-average premium to balance out the additional risk taken by the insurance company.
Overview of high-risk, or non-standard, car insurance
Insurance companies, like restaurants or hotels, have the right to refuse service. When a driver who seems likely to file higher claims than the insurance premiums paid applies for insurance, he is not guaranteed to be provided it. Considering insurance is legally required in order to drive, this creates a need for policies specifically for high-risk drivers.
While it is more difficult for high-risk drivers to find insurance, there are insurance companies that specialize in this non-standard coverage. Many companies offering standard policies will also issue non-standard policies at higher price.
Difference between high-risk and standard insurance
The chief difference between high-risk, or non-standard insurance, and standard insurance is the price. It’s a simple matter of supply and demand. High-risk drivers must carry insurance, but companies aren’t beating down their doors to take on the risk of supplying it. Therefore, they can charge more for insurance coverage, partially to offset the risk taken on a driver with a poor record and partially because the competition is low.
Who requires high-risk car insurance?
Drivers labeled as high-risk usually have blemishes on their driving records that exceed those of the average driver. Having several accidents on record, being caught driving under the influence, having been at fault in an accident that caused significant injury, or being convicted of other violations deemed serious are all potential reasons a driver falls into the high-risk category.
Other, less common, reasons a driver may require high-risk car insurance are having gaps in insurance coverage, poor credit score, a car with low safety ratings, or little driving experience.
Purchasing non-standard, high-risk insurance
Although it is more difficult to find high-risk insurance, it is not impossible. Providers of this non-standard insurance may be found online through a search for “high-risk car insurance” or in your local phone book.
While you can expect to pay more for high-risk insurance than a standard policy, some insurance companies take advantage of your vulnerable driving record and charge more than is necessary. Don’t settle for the first policy you find; get quotes from multiple sources before making a final decision.
In the meantime, do your best to improve your driving record by taking a defensive driving course, following all traffic laws, and maybe even getting a car with a higher safety rating. As you go longer without further incident, your insurance company may not alert you of when you qualify for cheaper, standard car insurance again.