Insurance for High-Risk Drivers: Who Needs it and Why is it Important?

A car driving in high speed by the countryside

Insurance rates are different for every driver. Before you can buy a new policy, insurers assess you in terms of risk. The greater the chance you will put in a claim, the higher your rates. While this assessment is something all drivers go through, it is particularly important if you are considered a “high-risk driver.” In that case, not every insurance company will cover you. Your existing insurer may choose not to renew your current policy.

Fortunately, some companies specialize in auto insurance for high-risk drivers. They offer coverage when others might not, which is good news for people who need insurance to stay on the road.

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Who’s considered a high-risk driver?

Several factors can make a driver “high-risk,” including what happens on and off the road. A few of the most important considerations are a history of at-fault accidents, traffic tickets, and claims on previous insurance policies. Non-payment of premiums, age, or inexperience may also contribute to the “high-risk” designation. But what exactly makes someone “high-risk” depends on your insurance company. The result of landing in this category may be as simple as more expensive premiums or an outright refusal to renew your car insurance.

Typically, if one company refuses to give you a policy, you may have problems getting coverage elsewhere. But since auto insurance is mandatory, the insurance industry cannot prevent you from getting insurance. In Ontario and Alberta, and some other parts of the country, you can always get a policy through alternate, high-risk insurers or carriers of the Facility Association. The Facility Association has risk-sharing pools to make sure everyone has coverage. It is the insurer of last resort.

High-risk car insurance companies

Insurers that focus on high-risk drivers provide coverage for those with different profiles than standard insurance companies. Other companies may charge high-risk drivers more or drop their coverage at the end of a term. They do this to keep rates lower for drivers who are not high-risk. The result may be expensive rates for drivers with a challenging history. High-risk car insurance companies may offer better rates simply because they specialize in this select group. Part of their intent is to help drivers rebuild a good driving history.

Some drivers may still have problems finding insurance. But the Facility Association contracts with certain servicing carriers so even these drivers can get coverage. That means that no matter what happened in the past, you do have the opportunity to get back on the road and get a fresh start with your driving history.

Discover your options for high-risk car insurance

Drivers should know their driving record to improve future options in terms of insurance carriers and premium costs. After a certain period with a clean history, you can find even more ways to reduce the expense of auto insurance. However, no matter your risk category, you can always go online to shop around for the best rate on auto insurance.