Standard Vs Basic Auto Insurance: Which Offers Superior Financial Protection?

When buying auto insurance, there are two main types of coverage to choose from: standard and basic. Standard auto insurance is the type of car insurance obtained from traditional insurance companies by preferred and standard drivers. It is the auto insurance offered to average-risk drivers with only a few blemishes on their driving, insurance, or credit histories. Basic auto insurance, on the other hand, provides limited coverage and is more suitable for those who do not require as much financial protection.

Standard auto insurance is for average-risk drivers

Standard auto insurance is for drivers who are considered average-risk. This means that they have a relatively clean driving record, with only a few blemishes. To qualify for standard auto insurance, drivers should have no recent lapses in coverage, a valid driver's license, and good credit.

When applying for auto insurance, drivers are typically categorized into one of three groups based on their driving experience, past claims and violations, insurance score, and payment and coverage history. Standard auto insurance is for those who fall into the preferred or standard categories.

Drivers who are deemed high-risk may be unable to obtain standard auto insurance and may need to pursue a non-standard policy, which tends to be more expensive and offers fewer coverage options. Factors that may cause a driver to be considered high-risk include being a new or inexperienced driver, having a foreign driver's license, or having a history of accidents, speeding tickets, or driving under the influence (DUI) convictions.

Standard auto insurance typically covers minimum state liability limits, collision, and comprehensive coverage. It also includes personal injury protection (PIP), which covers medical expenses for the driver and passengers, and uninsured motorist coverage, which protects against uninsured or underinsured drivers. The specific coverage provided by standard auto insurance can vary by state and insurance company.

Standard auto insurance offers financial protection in the event of an accident or other covered loss by paying for damages and injuries up to the applicable coverage limits. It is important to note that standard auto insurance may not cover vehicle customizations, modifications, or losses above liability limits.

Basic auto insurance provides medical cover for the policyholder's family

Basic auto insurance provides $15,000 of medical cover for the policyholder and their family members in the event of an accident. This includes medical payments, lost wages, and the cost of replacing services normally performed by someone injured. It may also cover funeral costs. This figure can increase if there has been a brain or spinal injury.

It is important to note that basic auto insurance does not include benefits such as income continuation and bodily injury liability coverage. Additionally, it will not cover the policyholder or their family if injured by an uninsured or under-insured motorist. This is in contrast to standard auto insurance, which offers uninsured motorist protection of $15,000 per person and $30,000 per accident for bodily injury, and $5,000 for property damage.

Basic auto insurance also does not cover injuries sustained by the policyholder or their family members if they are in a different vehicle than the one insured. In this case, medical expenses may be covered by the health insurance plan of the policyholder, but this will depend on the specifics of the health insurance plan.

When deciding between basic and standard auto insurance, it is important to compare rates and coverage options from several companies to find the one that best suits your specific needs.

Non-standard auto insurance is for high-risk drivers

Non-standard auto insurance is for drivers who are too risky for insurance companies to cover at their standard rates. Insurance companies typically break down their coverage into three risk tiers: preferred, standard, and non-standard. Preferred customers are considered the least risky and, therefore, pay the least for their insurance premiums. Drivers in the non-standard tier are considered high-risk and pay the highest car insurance rates.

High-risk drivers include those who are younger than 25, older than 75, have little driving experience, or have a poor credit history. Additionally, if you've filed multiple accident claims within the past few years, insurance companies will calculate that you're more likely to be in another accident than other drivers, and you'll fall under the non-standard tier.

Non-standard auto insurance policies are essentially the same as standard ones, except that the premiums are more expensive. This is because the insurer has a greater risk of having to pay out a claim. Many non-standard auto insurance policies also have higher deductibles than standard policies. This allows the insurance company to keep monthly premiums at a somewhat reasonable level.

If you're deemed too risky, the insurance company might cancel your policy. In this case, you would need to purchase coverage from an insurance company that specializes in non-standard auto insurance.

Standard auto insurance is usually cheaper than non-standard

Drivers who are deemed high-risk have usually racked up serious infractions like multiple speeding tickets, at-fault accidents, or a DUI. Other reasons for being considered high-risk include being a new driver, having a foreign driver's license, or having a lapse in insurance coverage.

Insurance companies typically break down their coverage into three risk tiers: preferred, standard, and non-standard. Preferred customers pay the least for their insurance premiums because they are considered the least risky. Drivers in the non-standard tier pay the highest rates.

For example, if you've filed multiple accident claims within the past few years, insurance companies will calculate that you're more likely to be in another accident than other drivers. You'll fall under the non-standard tier of drivers, and your rates will be much higher than average.

Standard auto insurance is offered by major insurance companies, while non-standard insurance may be offered by their subsidiary companies or specialist non-standard insurance providers.

It's important to note that the availability of standard and non-standard insurance, as well as the specific criteria for determining risk, may vary depending on your location.

Standard auto insurance is easier to obtain than non-standard

Standard auto insurance is generally more accessible than non-standard auto insurance. Standard auto insurance is designed for average-risk drivers, and insurers consider various factors to determine eligibility, including driving record, accident history, vehicle type, car usage, credit history, and location.

Drivers with only a few blemishes on their records usually qualify for standard auto insurance. This means that, aside from a few minor issues, they have a relatively clean driving, insurance, and credit history. Standard auto insurance is widely available from major insurance companies, and drivers can easily obtain quotes from multiple providers to find the best rates.

On the other hand, non-standard auto insurance is intended for high-risk drivers who do not qualify for standard coverage. These drivers may have multiple accidents, serious traffic violations, a history of unpaid premiums, or other issues that make them riskier to insure. As a result, non-standard auto insurance is typically more expensive and may not be offered by all insurance companies.

While some major insurers provide non-standard coverage, there are also specialist companies that focus on this market. These specialist companies may offer better rates for non-standard insurance than larger companies. However, it is important to shop around and compare rates, as the cost of non-standard insurance can vary significantly.

In summary, standard auto insurance is more readily available to drivers with clean records and average risk profiles. Non-standard auto insurance is a more specialized product for high-risk drivers and may require more effort to find a suitable provider and obtain affordable coverage.

Frequently asked questions