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

By Team
A car driving in high speed by the countryside

Insurance companies rate every driver they insure based on a system of determining risk. The risk that each individual driver represents to the insurance company differs based on a variety of factors: experience, driving record, type of car and more. Some drivers are classified as high risk by car insurance companies because their driving record tells the insurer that they are more likely to have an accident than other drivers. These drivers may require the assistance of a high risk insurance company.

What Qualifies You as a High-Risk Driver?

The term high risk driver generally applies to anyone who has tickets or accidents on their record that add up to a higher statistical likelihood of a claim against the policy. What exactly this combination of marks against your record is varies from insurance company to insurance company. But for most standard insurers, there is a point at which they will no longer consider a driver eligible for their regular insurance program.

This means that if you have become a high-risk driver while insured with a regular insurance company, they may set your policy to non-renew, meaning that at the end of the policy term they will not be offering you an extension of your policy for another term. It’s likely that if one company has non-renewed you and classified you as high risk, you may find that many other insurance companies will view your driving record in much the same way.

Marks against your record that may qualify you has a high risk driver include multiple tickets, multiple accidents where you have been found at fault, serious offences such as driving while impaired, or a combination of these items. Fortunately for drivers who have been designated as high risk, there are auto insurance companies who offer policies to high risk drivers and help them to regain their status as good, safe drivers.

What are High Risk Insurance Companies?

The main difference between a high risk insurance company and a standard one is that their qualification process for a policy are less stringent. High risk insurers design their policies to assist drivers in rebuilding their record. In order to move towards a clean driving record, you must still have insurance so that you can legally be on the road. For a driver with multiple tickets, accidents or both, a high risk insurance company may be the only option.

Standard insurance companies aim to keep rates low by charging higher risk drivers more and setting limits to non-renew those drivers who are not maintaining a safe driving record. High risk insurance companies kick in where the standard insurance company’s limits leave off. Because a high risk insurance company works solely with those drivers who need to rebuild a good driving record, they don’t base their premiums on the same sort of curve. For that reason, high risk drivers may actually encounter better rates at such a company than they would at a standard company.

High risk drivers can expect to pay more for their policy than a driver with a clean record, but that doesn’t mean there is no way to save on insurance. Since there are a number of high risk insurance companies to choose from even high risk drivers can shop their insurance rate.

Shopping for High Risk Insurance

As a high risk driver your choices for insurance are slightly more limited than for a driver with a clean record. That doesn’t mean however that you have no options or that you have to take the first rate that is offered to you.

The high risk insurance market has grown over the years and there are several companies offering high risk policies. Just as any other driver would, high risk drivers should shop around for the best rate. Comparing quotes on high risk policies is the best way to ensure you are getting the best rate you possibly can while working towards improving your driving record in order to qualify for the better rates.

It’s important for high risk drivers to keep tabs on their driving record and ensure that they are aware of when tickets and accidents fall off their record. Every time a ticket or accident reaches the point where it is no longer chargeable according to insurance companies (while this may differ, three years is common for tickets and 6 years for accidents) you can expect to see a rate reduction on renewal. It’s a good time to shop your rate around again and see if you might be able to get a better premium elsewhere.

High risk drivers have options when it comes to their insurance. The best way to see a reduction in rates over time however is to work towards a clean driving record. In time, every high risk driver will again qualify for standard insurance companies as long as they stick to safe driving practices and avoid further tickets or accidents. In the meantime, a high risk insurance company can get you back on the road.