What is High-Risk Car Insurance?
High-risk auto insurance is for drivers who are considered more likely to file an auto insurance claim by the insurance company. High-risk car insurance is usually more expensive than regular car insurance.
Insurance companies provide drivers with a substantial amount of financial protection for a fraction of that amount from the driver. For example, your car insurance company promises that if you stay current with your insurance payment and pay your deductible, they will pay whatever is left from $25,000 to another driver if you total their car in a wreck. Your payment for this promise is a meager $25 per month. If your deductible is $500, your car insurance company will get $800, but will pay out $24,500.
You can see why insurance companies only give that $25 per month insurance cost to drivers who they feel are very unlikely to cause a wreck. Any driver who has exhibited some sort of reckless behavior behind the wheel or is a young driver with not enough driving experience is going to pay more for the insurance company to take a chance on them.
Some insurance companies won’t even insure high-risk drivers.
How Much Does High-Risk Auto Insurance Cost?
The average amount for high-risk car insurance is somewhere between 74 and 85 percent more than normal car insurance. It depends on what state you live in and what insurance company you choose. If your vehicle is financed, your lender may require you to have full coverage (liability plus collision insurance and comprehensive insurance). This will cost more than just the minimum liability the state requires. Those who are paying for high-risk car insurance will be paying twice as much – or more.
How Can a High-Risk Driver Find Car Insurance?
Because most states require drivers to have minimum liability auto insurance coverage, there is a secondary market that has spawned high-risk insurance companies that specialize in covering high-risk drivers. This competition gives an incentive for standard market insurers to provide high-risk insurance products, as well. High-risk auto insurance typically offers the same benefits and protections as other car insurance plans, but at a much higher price due to the higher risk that the insurance company is taking.
Therefore, shopping around and comparing car insurance quotes is one way to find affordable car insurance. If you have a bad driving record, obtaining proper insurance coverage for your vehicle can be difficult.
Who Needs High-Risk Auto Insurance?
There are a variety of different reasons why you may need to buy high-risk insurance instead of a standard auto insurance plan. However, the most primary reason is because the driver has a poor driving record. You may be a candidate for high-risk car insurance if you:
- Are caught driving without insurance
- Accrue too many traffic violations
- Have a DUI/DWI on your record
- Were involved in an injury-causing car accident in the past
- Have a lapse in your insurance coverage
- Have a history of high insurance claim payouts
- Are under the age of 25
- Are over the age of 65
- Are a first time driver
There are other factors that could classify you as a high-risk driver, but those are the main reasons.
Are SR-22 and High-Risk Auto Insurance the Same Thing?
Yes and no. An SR-22 requirement means you are a high-risk driver to the insurance company. But not all high-risk drivers need an SR-22 certificate.
Typically, drivers who are required to file an SR-22 with the state have done something behind the wheel that the state considers very risky behavior, such as driving while impaired. An SR-22 requirement is a red flag to insurance companies. It’s almost a guarantee that if you are required to file an SR-22, you’ll be paying for high-risk car insurance.
Where Can I Get High-Risk Auto Insurance?
While there are some insurance companies that won’t insure high-risk drivers, there are several who do. There are even some companies that specialize in providing insurance plans for high-risk drivers. Consumers should be forewarned that even the lowest rates for high-risk auto insurance will still be at a higher price than similar coverage on a standard car insurance policy.
Will I Always Have to Buy High-Risk Auto Insurance?
Hopefully not. Time fades all errors. You may be able to change your status and be able to purchase standard car insurance plans if you don’t add any further infractions on your record. Insurance companies will typically look back three to five years for driving infractions and other red flags.
Insurers will feel more comfortable offering insurance at their regular rates once your driving record is clean. While it may take some time, you won’t have to pay higher rates for auto insurance if you make improvements and avoid further mistakes.
Get Low-Cost Car Insurance Online Today
Now that you know what high-risk auto insurance entails, you may be looking for a policy that will cover you. Freeway Insurance specializes in obtaining high-risk auto insurance and SR-22 coverage at the best prices available. Get a free car insurance quote online or call us today at (800) 777-5620 to get covered. You are also welcome to stop in one of our convenient locations.
