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What is High-Risk Auto Insurance?

By Susan Grindstaff
Updated May 17, 2024
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High-risk auto insurance is a type of insurance policy that is offered to drivers believed to have a higher risk of having an accident. This assessment may be made because of a poor driving record, or it could be related to their employment. In addition, the age of the applicant and the type of car being insured is also relevant.

Most auto insurance companies have formulas they use to determine risk levels, and one of the heaviest components of that equation is the amount of time the applicant spends driving. For this reason, truck drivers, bus drivers, and salespeople who travel by car are usually considered high-risk. In addition, those who commute long distances to and from work may also have to get high-risk auto insurance.

The driving record of the applicant is usually considered more important than the number of hours he or she spends driving. Drivers who have received speeding tickets and other moving violations may find themselves having to purchase high-risk auto insurance. Even more detrimental to the driving record are charges involving driving while under the influence (DUI) of drugs or alcohol. Automobile accidents, no matter how minor, are usually another important factor in determining insurance premiums.

The age and sex of an applicant is also relevant to the type of insurance coverage needed. In most cases, male drivers under the age of 25 are charged higher premiums than females of the same age. Research seems to indicate that young male drivers tend to be involved in a higher number of accidents and traffic violations than do females in the same age group. This is especially true if the applicant is also unmarried.

Many insurance companies also use financial information to determine what type of insurance premiums will be assigned. One of those factors is the credit rating of the applicant. Insurers typically request permission to review the credit record of the applicant, at which point the applicant can refuse the release of this information; however, most insurers will not complete an application unless they are allowed access to credit reports. Applicants who have poor credit ratings are often charged higher premiums than those with good or fair credit.

In many cases, having a single violation will not put drivers into a situation where they must purchase high-risk auto insurance. Though even a single speeding ticket will sometimes result in higher premiums, most of the time, it takes repeated violations to put a driver into the high-risk group. For drivers who fall into this category, it is a good idea to shop around before purchasing a policy, because insurers are typically very competitive in their coverage and premiums. Only by checking with several insurance carriers will the driver be able to find the most affordable coverage.

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