Auto Insurance Tips for High-Risk Drivers

If you are a high-risk driver, you probably already know it. Your auto insurance premium is likely quite high in comparison to the lower insurance rates your friends and family pay. The road to becoming a high-risk driver, however, has many detours along the way which is why many people don’t understand how exactly it is that they’ve earned the title. Let’s start with the insurance basics for high-risk drivers.

What is a high-risk driver?

From an insurance company’s standpoint, high-risk drivers have a significantly higher likelihood of submitting an insurance claim than the rest of the driving population. That’s really it in a nutshell. What’s not quite as simple to explain is what goes into determining if a driver is high-risk or not. Why the difficulty? Well, every insurance company defines a high-risk driver differently and it usually takes a combination of reasons to earn the label.

There are exceptions of course (e.g., criminal convictions like driving under the influence), but usually if you’re a high-risk driver you fall into two or more of the following groupings:

  • You’re a new driver
  • You have two or more traffic tickets
  • You have a criminal or serious conviction on your record
  • Your licence has been suspended
  • You’ve been involved in at least one at-fault collision
  • You’ve modified your car with performance-enhancing features
  • You use your vehicle for delivery services

There are also non-driving related reasons that could result in a high-risk driver status. The most common is for having a history of missing your premium payments that result in a policy cancellation. Another popular reason that has nothing to do with your driving is lying to your insurance provider. No one likes to be lied to. If your insurance company finds out that you’ve misrepresented your situation (such as where you live), you run the risk of having your policy cancelled, which in turn will likely place you in the high-risk category.

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Auto insurance for high-risk drivers

It is not uncommon for standard insurance companies to refuse to provide a car insurance policy to a high-risk driver. Even if you have been with the same company for years, your choices that led to being labelled a high-risk driver may lead to a non-renewal of your auto insurance policy. When faced with the inability to qualify for a standard policy, you’ll have to turn to what’s called the auto insurance provider of last resort: Facility Association.

Facility Association is an industry organization that ensures auto insurance coverage is available to high-risk drivers. Facility, as it is often called, isn’t an insurance company itself but works with specific companies that issue policies on its behalf. High-risk drivers in Ontario, Alberta, Nova Scotia, New Brunswick, Newfoundland and Labrador, Prince Edward Island, Yukon, Northwest Territories and Nunavut can all get insured through Facility.

The goal of Facility Association and the high-risk insurance providers it works with is to offer insurance to drivers who are unable to get it anywhere else. This means that they will cover you while you take the steps necessary to shake off the high-risk title.

How long does it take to lose the high-risk label?

In general, tickets and missed payments will stay with you for three years and at-fault collisions and licence suspensions will follow you for six years. It may take several years before you’re able to return to a standard priced auto insurance policy.

Saving on high-risk car insurance

By its nature, high-risk insurance costs more than a standard policy, but this does not mean there is no way to save on insurance. It’s just more difficult.

The fact is, the number one way for a high-risk driver to save money is to compare car insurance quotes to find the most competitive option. High-risk insurance providers exist to assist drivers who don’t qualify for standard rates, but they must still compete with each other for your business.

It’s also important to check your rate every year and every time a ticket falls off your driving record or a collision drops off your insurance history. As each year passes, your rate will improve and eventually you’ll be able to return to a standard auto insurance provider. For the sake of saving money, the sooner the better, which means driving carefully, avoiding tickets, and paying your premiums on time and regularly.