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High Risk Auto Insurance

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High risk auto insurance is reserved for a class of drivers who are deemed by insurers to be more of a financial risk. These drivers aren’t necessarily considered bad drivers, but they’re more expensive to insure due to their records, which usually contain anything from moving violations, at-fault accidents, DUIs or a combination of these. Finding insurance for high risk drivers can be challenging, but it’s not impossible.

What is high risk auto insurance?

High-risk auto insurance is a special type of policy that’s reserved for drivers who have a less-than-stellar driving record. These policyholders are labeled high risk because they’re considered more likely to cause an accident. Not every company offers this non-standard type of insurance, so it often means finding the right one that does.

Who needs a high risk insurance policy?

There are a few different reasons why a person might need a high-risk car insurance policy. Most companies have three main categories they look at:

  • Inexperienced drivers – young drivers or those who have just received their licenses are considered inexperienced and thus, a higher risk.
  • Drivers with multiple infractions – While one infraction won’t drive up the risk, having multiple traffic violations or at-fault accidents in a short period of time can lead to being labeled high risk.
  • Drivers with poor credit – drivers who have a poor credit history and score are often put in the high-risk category as they’re considered more likely to file a claim.
Teen driving car cautiously with her mom

How do insurance companies calculate risk?

There are a few considerations that insurance companies evaluate when determining your driving risk. The most important factor is your actual driving record. Those who have at-fault accidents, driving infractions or DUIs on their records will automatically be considered a higher risk. A clean driving record, however, means a lower premium.

Your commute — whether to work or school — is factored in as well. The longer you drive one way, the more chances you have to get into an accident. The make of your vehicle is another consideration because the belief is that someone driving a sports car is more likely to drive recklessly than someone driving a minivan with a family inside. Your age and marital status also play into the insurance quote. The younger the driver, the more inexperienced they are considered to be. A married person is considered to be more responsible than a single person.

Man driving a car being pulled over by female police officer

Where can high risk drivers obtain an insurance policy?

Many insurance companies, though not all, have insurance policies for high risk drivers. Since your risk is typically assessed using your driving record, you’ll likely have to shop around and see which company offers the best rates and coverage.

Some insurance companies may outright refuse to offer the coverage , depending on the infractions a driver has. Those looking for car insurance for high risk drivers might have better luck with small insurers as opposed to large agencies.

Factors to consider when choosing an insurance provider for a high-risk policy

  • Quality of coverage: High-risk auto insurance tends to require a bit more coverage than a standard policy. However, it’s important to look at the quality of coverage and see exactly what is covered and what is not. It’s better to know before you purchase than to find out you don’t have the right coverage when it comes time to file a claim.
  • Customer service and reputation: Not all insurance companies are created equal. Some have a higher standard of customer service and an impeccable reputation. Search for a company that puts your needs first, even when shopping for car insurance for high risk drivers.
  • Your own driving history: Knowing your driving history and what’s on your record can prevent any misunderstandings when you’re choosing a company. Be upfront about your record when applying because all of your infractions will show up when your report is run.
  • Your budget: Your budget is probably one of the most important factors to consider because if you can’t afford the insurance, then you’ll likely struggle to pay for it. Since high risk car insurance costs more, you should get a few quotes before choosing an insurance company.

How does high risk insurance affect my total insurance costs?

High-risk insurance is typically associated with increased premiums. Those who have a high-risk auto insurance policy can pay anywhere from 35% to 69% more than a person who’s not considered high risk. The amount of the increase depends on the type and number of infractions.

  • DUI – If you have a DUI conviction on your driving record, it’s not uncommon to see your rates double.
  • Multiple tickets for speeding or moving violations – People who get several tickets in a short period of time shouldn’t be surprised when their insurance increases by up to 35%.
  • Bad credit – Bad credit often increases premiums to offset the risk. Some insurance agencies charge up to 69% more for individuals with poor credit scores, especially those below 600.

How long is high-risk insurance required?

High-risk auto insurance isn’t a mandate that’s handed down by a court, it’s simply based on a calculation of your risk factors by the insurance company. There is no set time period that a high-risk policy is required, however, some infractions — such as accidents and DUI convictions — stay on a driver’s record longer and have more of an impact on premium costs.

Drivers who are looking to lower their premiums should focus on improving their driving record. While they can’t undo the past, they can adopt safer driving habits for the future, which would take them out of the high-risk category.

  • Drive the speed limit – The safest way to avoid tickets and accidents is to drive the speed limit. Police officers will have no reason to pull the driver over and it’s easier to avoid accidents when following the set speed limit.
  • Take a driver safety course – Many insurance companies will offer a discount if the policyholder takes a driver safety course. It can also help remove “points” from a driver’s record, which in turn, can help lower premiums.

Everyone needs insurance, including drivers in the high-risk category. By shopping around and making sure they are getting the exact coverage needed, high-risk drivers can find the right policy to protect themselves and others.