High-Risk Car Insurance 101
There are several reasons why a car insurance company might consider you a high-risk driver; for example, if you've recently been convicted of a DUI, your risk profile will be higher than a driver with a clean record.
If you are seen as a high-risk driver, you may have to resort to purchasing high-risk (non-standard) auto insurance, which is typically associated with higher rates.
What Is High-Risk Car Insurance?
Referred to commonly in the insurance industry as “non-standard car insurance," high-risk auto insurance is a category of insurance that covers drivers who are seen as high-risk in the standard market.
Car insurance companies have the right to refuse coverage to drivers. With this in mind, it is easy to come to the conclusion that some companies would not want to provider car insurance coverage to high-risk drivers.
However, the fact that car insurance is a legal requirement in most states has created a significant need for high-risk car insurance that is separate from standard-risk auto insurance.
Several car insurance companies specialize completely in non-standard car insurance, while some other auto insurance companies that do business primarily in standard car insurance also write high-risk insurance policies.
Non-Standard vs. Standard Insurance
The biggest difference between non-standard and standard car insurance is price.
While it can be difficult to predict what your car insurance premiums will be, you can expect high-risk car insurance to be considerably more expensive than standard car insurance. Even if a company advertises cheap car insurance, it will typically have much higher rates for drivers who present higher risk.
In essence, car insurance companies take on more risk by covering a high-risk driver, so they balance this cost with higher premiums.
Who Needs Non-Standard Car Insurance?
Anyone who is considered a high-risk driver amongst car insurance companies is likely going to have to purchase non-standard car insurance.
Generally, you'll be deemed high-risk if you've had certain incidents on your driving record. These include:
- DUI/DWI convictions.
- Convictions of other serious traffic violations.
- Involvement in an injury-causing accident.
You may also be subject to classification as high-risk if you:
- Own a high-risk vehicle.
- Are an inexperienced driver.
- Have poor credit.
- Have had recent lapses in car insurance coverage.
Purchasing High-Risk Car Insurance
Buying high-risk car insurance does not need to be a difficult process. As with standard car insurance, there are a plethora of high-risk auto insurance companies online.
Additionally, several of the big-name car insurance companies either write high-risk insurance policies or own sister companies that specialize in non-standard auto insurance. Note that you may be required to pay the entire premium up front. Ask your auto insurance agent when discussing the high-risk policy.
You can call an insurance agent to ask about how you can get a high-risk car insurance policy, or you can get quotes online. Make sure to get at least 3 quotes to find the cheapest possible car insurance rates.
Consider doing some extensive shopping before resorting to a high-risk policy. While some companies may not offer you standard rates, you may find another company that will.