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Car insurance companies take into account several factors when calculating a driver’s premium. One of the most significant factors auto insurance companies may consider is your driving record. Drivers who have several violations may be seen as a higher risk to insurance companies. Additionally, if you have multiple issues on your driving record or a lapse in coverage, your car insurance company may try to compensate for the increased risk by placing you with a nonstandard policy and charging a higher premium.
Here’s what you should know about nonstandard car insurance, along with some tips on how to save if your insurer deems you a high-risk driver.
- A nonstandard policy is for high-risk drivers.
- Although standard and nonstandard car insurance works the same way, coverage options may be limited.
- A nonstandard car insurance policy is typically more expensive, but there are several ways to save, such as shopping around, reviewing discount opportunities and bundling.
What is nonstandard auto insurance?
To make things simple, you can think of a nonstandard policy as an auto insurance policy for high-risk drivers. On a fundamental level, not much will change if your insurance company places you on a nonstandard policy, but you should expect higher premiums. The average cost of car insurance for a full coverage policy is $2,014 per year, but you will likely pay more than the average if you have nonstandard car insurance.
Regarding coverage, standard and nonstandard car insurance work in the same way, but your coverage options may be limited. These coverage limitations may be placed by your insurance company, the DMV or both.
Suppose you were convicted of a DUI. As a result, the DMV required you to carry an FR-44 and liability coverage limits of 100/300/50. After the DUI, your insurance company placed you on a nonstandard policy.
Some insurance companies place a cap on the liability coverage that a policyholder can carry on a nonstandard policy; in this hypothetical scenario, that cap is 100/300/50. If that were the case, you’d have no choice but to carry 100/300/50. Anything lower won’t meet DMV requirements, but you also can’t carry anything higher due to your company’s coverage restriction on nonstandard auto policies.
Why would someone need nonstandard car insurance?
If you’ve had enough traffic violations, your insurance company might place you on nonstandard insurance. In a broad sense, this classification is for drivers who are risky to insure, primarily but not limited to more serious traffic or insurance violations, such as:
- Numerous tickets
- Driving without insurance
- Suspended license
- Reckless driving
- Having lapses in car insurance
These types of offenses, especially when there are numerous occurrences, mean a driver a is seen as a greater financial risk for the insurance company. Drivers with past offenses or accidents are statistically more likely to be involved in another accident in the future. For instance, someone who speeds a lot or has had multiple DUIs is more likely to get into a serious accident.
Drivers with a salvage title and non-car owners may also require nonstandard car insurance.
How do you get a nonstandard car insurance policy?
Many of the larger car insurance companies offer nonstandard insurance options, so you may not even need to switch carriers. However, shopping around may be a good idea. Some auto insurers specialize in risky drivers and may offer more competitive rates to those customers as a result.
Before you shop, you might want to also look into the average cost of auto insurance in your state to establish a baseline for reasonable premiums in your area.
When in doubt, find a licensed insurance agent to talk to about your insurance needs when comparing quotes. A licensed expert can help you navigate all the different options available.
Companies that offer nonstandard car insurance
Car insurance companies calculate premiums based on risk. If a driver poses a higher risk, the auto insurance company will likely charge a higher premium. In certain instances, a car insurance company can even refuse to insure a driver. Fortunately some companies cater specifically to high-risk drivers and offer nonstandard car insurance. Some of the car insurance companies that offer nonstandard auto insurance include:
How do you save money if you have higher premiums because of a nonstandard policy?
The increased rates that go with nonstandard auto insurance policies can be a pain, but there may be ways to lower costs, including:
- Shop around: Requesting quotes from the cheapest car insurance companies may help ensure you’re getting the most competitive rate possible.
- Review your discount opportunities: It may benefit you to make sure that you are taking advantage of all available discounts, even those that might require a bit of extra work. For instance, some companies may offer you a discount on your car insurance if you complete a defensive driver course.
- Consider bundling: Many insurance companies offer a bundling discount if you carry your auto and property policies under the same roof.
- Improve your driving record: Although improving your driving record isn’t a quick fix, it may result in car insurance savings over the long term.
- Work on your credit: Like your driving record, improving your credit score isn’t something that happens overnight. If you live in a state that allows car insurance companies to use a credit-based insurance score, a bump in your credit score may mean a dip in your premium.
Frequently asked questions
Insurance-related penalties for driving offenses that may make you require nonstandard auto insurance are based on many factors and will vary. Still, it’s relatively common for insurance penalties to last for roughly three to five years. Further violations will likely increase the amount of time you’re required to get nonstandard insurance.
Actual rate increases vary significantly based on several factors, including where you live and what offenses are on your record. Nonstandard auto insurance almost always comes with higher-than-average rates, though. It might be a good idea to speak with a licensed insurance agent if you have several serious driving offenses on your record to try to find the most reasonable premiums.
When it comes to the best car insurance company, there is no simple answer, as every driver is looking for something different in their insurance company. For some, price is the most important factor, but others may be willing to pay a higher premium if the company has high customer satisfaction ratings. You may find it helpful to list your priorities before shopping around to use as a guide.