Everything-You-Need-to-Know-About-High-Risk-Car-Insurance

The entire premise of getting auto insurance revolves around how the insurer evaluates your risk. By risk, it means how likely you are to need constant insurance to bail you out. If you fall into this category, your only road is high-risk auto insurance. But what is considered high-risk insurance worthy?

Multiple factors can label you as a high-risk driver. This usually varies from company to company, but the overall checks revolve around your legal history and the number of infractions. If you've had insurance before, then the insurer can also consider the number of claims. Here's a closer look at what can make you a high-risk candidate.

Criteria for High-Risk

Well, just being a bad driver doesn't qualify you as a high-risk candidate. There is a set of people who can be considered high-risk. Most insurance companies will look at three main criteria to determine if you are high-risk. These criteria are:

  • Experience: If you're a person who's rarely driven a car or if you're a person who has recently received their driver's license, then the risk of you causing damage on the road is significantly higher than a person who has been driving for years
  • Infractions: If you have a couple of parking tickets, it is not sufficient to label you as high risk. But if you have multiple tickets, have caused accidents, or have been sued for an accident, your risk evaluation will skyrocket.
  • Credit: Bad credit sends a ton of red flags for insurance providers. The logic behind it is simple. If you have bad credit or have a history of it, you are more likely to file a claim in the insurer's eyes more than once.

Other factors can also lead to being labeled as a high-risk driver. These include but are not limited to:

  • Type of Vehicle: If you have an expensive car, that can significantly affect your risk assessment. This is because any damage is likely to be more expensive than regular cars. Furthermore, if you have a racecar, then your probability of a collision is higher.
  • Commute: If you continually drive to your place of work or even the school to drop your children, then you can potentially qualify for a high-risk candidacy. It is because the more you travel in the insurance company's eyes, the higher the chance you'll be in an accident. This is why people who drive for a living have a completely different form of auto insurance.

Now that you know what qualifies an individual to be considered high-risk, let's take a look at some factors to keep in mind before choosing an insurance provider for high-risk policies.

Driving History

Regardless of what's in your record, it would help if you were upfront and honest about it. Insurance providers will extensively check your records, and if you are caught lying, they will either skyrocket your premiums or reject you entirely.

Budget

High-risk insurance costs more, and that's a fact you can't escape. What you can do is not go for insurance that is way out of your budget. Explore some more companies and get a few quotes before you finalize.

Reputation

Insurance companies are generally looked at as evil and callous, but that is not always the case. Some insurance companies have been a boon for people who were stuck in bad situations. Talk to people around you and compare your options to help you choose a reputable and reliable insurance provider.

Customer Service

Some insurance companies will have policies that are perfect for you. When it's time to call these companies, they will completely ignore you or make things more difficult for you. Look for providers that have a high standard of customer service. You can gauge this when you first approach them.

Coverage Quality

It should be evident by now that high-risk policies require a much higher coverage than a standard policy. Even then, you need to take a close look at what is covered in the policy and what isn't. Refer to your record and understand the areas where you might require the most coverage. This can help you narrow down the right provider as well.

Bottom Line

Now that you understand what is considered high-risk insurance and how to find the right provider, you can do your due diligence before you pick a policy. Remember, there are multiple providers, and they may differ in their criteria and policies, so take some time to explore a few options before you make up your mind.

Image Source: Google Images