Know Your Auto Insurance – What Is A “High Risk” Policy?
Because no two drivers are the same, every auto insurance policy is calculated using a series of pre-determined risk assessments that enable an insurance provider to weigh up how likely it is that they will make a claim in the future.
Your age, the type of car you drive, where it is kept and even your own driving history are all important factors when it comes to calculating the insurance risk. Some situations are quite obviously more likely to come with a hefty premium than others, like performance sports cars for example, or young drivers with very little experience, but some risks are not as obvious as others.
High-Risk policies are just one type of insurance cover where the insurer has to make a decision based upon the drivers record and driving history, before agreeing to insure them and providing a quote for the cost of the cover.
What Is A High-Risk Auto Insurance Policy?
Insurance companies define “high risk” drivers as those who are risky to insure as a result of their poor driving record, their inexperience, or even their credit history. The more accidents you have, the higher the risk you are to an insurer.
Insurers base their decision on a number of factors, the most common of these include:
Drivers with a poor driving record
A bad driving record plays a big role in insurance rates, payments, coverage and premiums. Your “record” could be as simple as a run of speeding tickets, or could be serious, more costly violations that will mean your insurance costs are likely to increase significantly. The more driving violations you have on your record the more likely an insurer is to consider you to be “high risk”.
Your Claim History
The more claims you have on your record the higher your insurance rates will be. If you have been unlucky enough to need to make several claims over the course of your driving career so far, insurers will automatically assume that you are more likely to make further claims in the future.
Your Credit History
The cost of your insurance cover is also very often based on your credit history. As unfair as that may seem, it is generally perceived within the insurance industry that those with a poor credit history are more likely to get into an accident or make a claim.
If you have previously made personal injury claims, insurance companies will likely consider you to be a higher risk. In Florida in particular, this is a direct result of the high rates of PIP fraud that is committed regularly. Some insurers consider a history of PIP claims to be so serious that they may even completely decline cover to anyone who has a PIP claim on their record.
Over time, you may be able to lower your rates by avoiding any further driving violations and not making any more claims on your insurance for a significant period of time. Accidents happen but keeping your record clean for as long as possible may help to redeem you from the “high risk” category eventually.
If you would like information on how to find affordable insurance products for high-risk drivers in Florida, speak to The Sena Group today at 561-391-4661.
For more information about how The Sena Group can help you with any
of your insurance needs, please contact us at 561-391-4661.
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