If you are a high-risk driver you probably know it already, but many people don’t understand what earns them this title. Simply put, insurance companies rate drivers based on the probability that they will be involved in an accident for which the insurance company will have to pay out. The higher this likelihood, the higher the risk that driver presents to the insurance company. Drivers are rated on a variety of factors, and it can vary, but there are a few common reasons for being labelled high-risk. High-risk drivers can find ways to lower the cost of their premium, and may be able to find other ways to save on insurance.
What is a High-Risk Driver?
A high-risk driver is someone who, due to a combination of factors, presents a high likelihood of having an at-fault accident compared to the other drivers on the road. High-risk drivers usually have more than one factor that has led to this label. Some of these include being a new driver, having multiple tickets or accidents, or having a combination of tickets and accidents. Violations such as impaired driving and other serious infractions can quickly lead to a high-risk label.
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High-risk drivers usually pay high insurance rates, and run the risk of non-renewal by their insurance company if additional risks factors are layered in to their already "risky" driving history—like getting [another] ticket. When the insurance company reviews your file for renewal, they may decide that the risk of insuring you is too high for them to take on, and you will receive a notice that you are not being offered a policy on renewal. At that point, as a high-risk driver, you do have some options.
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 many years, the level of risk may lead to a non-renewal of the policy. When faced with the inability to qualify for a standard policy, high-risk drivers can turn to specialty auto insurance companies for coverage.
Today there are more choices than there once were for high-risk drivers to obtain high-risk car insurance coverage. A number of insurance companies have stepped up to fill the gap and help these drivers get back on the road. The goal of a high-risk insurance company is to help you regain your status as a low-risk driver and qualify for standard coverage once again. This means that they will offer you coverage while you improve your driving record.
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It’s important that high-risk drivers take this seriously and focus on becoming safer drivers in order to get back to a low-risk status. Careful driving to avoid any type of infraction or accident is a must while on a high-risk policy.
Saving on High-Risk Insurance
By its nature, high-risk insurance costs more than a standard policy. Because the risk of a claim is higher, the insurance company must spread some of the risk and increase the cost of premiums. This does not mean there is no way to save on insurance if you are a high-risk driver; it’s just a little more difficult.
The number one way for a high-risk driver to save money is to shop around. Get as many car insurance quotes as you can; with many options in the high-risk market today, you can compare rates and look for the most competitive option. High-risk insurers exist to assist drivers who don’t qualify for standard rates, but they must still compete with each other for your business.
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Stay on top of your rates, and make sure that all tickets and accidents that are no longer chargeable fall off at the appropriate time. In Ontario for example, tickets will stay on your driving record for three years, and at fault accidents for six years. Whenever there is a change, like a ticket or accident is no longer a factor, get quotes to compare rates and see if you can save. Eventually, rates from a standard insurance company will start to be on par with a high-risk, and then lower. Get back to a standard company as soon as you can. Because they insure more people, they can spread risk and generally offer better rates.
To see your rates drop, it’s important that you are careful not to get any more tickets or be involved in accidents. Drive carefully, and always compare rates with InsuranceHotline.com