Understanding Non-Standard Auto Insurance For Private Passengers

Non-standard private passenger auto insurance is a type of insurance for drivers who are considered high-risk. This includes drivers with a history of accidents, traffic violations, or other factors such as age or credit score that insurers consider to be higher risk. Non-standard insurance typically comes with higher premiums than standard insurance, as insurers believe there is a greater likelihood of the driver filing a claim.

Who needs non-standard private passenger auto insurance?

Non-standard private passenger auto insurance is designed for drivers who are considered to be high-risk. This includes drivers with a history of accidents, traffic violations, DUIs, or other factors that increase the likelihood of an insurance claim. Drivers who fall into this category may have difficulty finding insurance coverage from standard insurance providers and may need to turn to specialist insurers.

There are several reasons why someone might need non-standard auto insurance:

Multiple traffic violations or accidents

If a driver has multiple traffic violations or accidents on their record, they are likely to be deemed high-risk by insurance companies. This includes speeding tickets, accidents, and DUIs. These violations indicate a higher likelihood of future accidents and insurance claims, leading to higher premiums.

Lapse in insurance coverage

In most states, drivers are required by law to maintain continuous car insurance coverage. Even a brief lapse in coverage, such as a gap of less than 30 days, can be considered a risk factor by insurance companies.

Requirement to file an SR-22 or FR-44

An SR-22 is a document that proves a driver has the minimum required amount of car insurance. It may be mandatory for drivers who have been convicted of DUI or other serious traffic offences. Similarly, an FR-44 is a document that proves financial responsibility for drivers convicted of DUI. If a driver is required to file an SR-22 or FR-44, they will likely need to pay non-standard insurance rates.

Driving without a license or with a suspended license

Driving without a valid license or with a suspended license is a serious offence and can result in higher insurance rates. This is because unlicensed or suspended drivers are considered to be at a higher risk of causing an accident or filing an insurance claim.

Lack of driving experience or poor credit

Inexperienced drivers, especially those under the age of 25, may be considered high-risk due to their lack of driving history. Additionally, individuals with poor credit scores may also be viewed as higher-risk by insurance companies, as credit scores are often used as a factor in determining insurance rates.

Driving a salvage title vehicle

A salvage title vehicle is one that has been in a serious accident and has been repaired. Some major insurance companies may not offer comprehensive or collision coverage for these vehicles, requiring owners to seek non-standard insurance options.

It's important to note that not all insurance companies offer non-standard auto insurance, and the criteria for determining high-risk drivers can vary between insurers. Those who fall into the high-risk category may face higher premiums and limited coverage options. It is recommended to shop around and compare quotes from multiple providers to find the most suitable coverage at a competitive rate.

How does it work?

Non-standard auto insurance is designed for drivers who are considered high-risk and may struggle to get insurance through standard means. This type of insurance works in much the same way as standard insurance, but with some notable differences.

When you apply for a quote, you'll provide personal information, such as your age, address, driver's license number, and history of insurance coverage. You'll also provide details about your vehicle, such as its make, model, age, and mileage. Insurance companies will use this information to calculate your risk factor and the likelihood of you needing to make a claim.

If you are deemed high-risk, you may be placed in the non-standard tier of drivers, and your rates will be much higher than average. This is because insurance companies believe there is a greater chance of you filing a claim due to an accident. The definition of "high-risk" varies from insurer to insurer, and not all companies offer non-standard insurance. Some major insurance companies offer non-standard insurance, but there are also companies that specialize in this type of insurance.

You may be deemed high-risk due to a variety of factors, including:

• Multiple accidents, traffic violations, or speeding tickets on your record
• Driving under the influence (DUI)
• Little driving experience
• Poor credit history
• Lapses in insurance coverage
• Driving a high-performance or custom-built car
• Owning a car with a "salvage title" (severely damaged or declared a total loss)
• Being a young or elderly driver
• Holding a foreign driver's license

Non-standard auto insurance typically comes with higher monthly premiums and may also have limited coverage options. However, the process of purchasing non-standard insurance is generally the same as standard insurance, and you can often buy it from the same providers.

How much does it cost?

The cost of non-standard auto insurance is dependent on several factors, including the average premiums in your state and the reason you require it. For instance, a speeding violation will not increase your rates as much as a DUI. However, it is important to note that age is the biggest factor influencing rates in most states, with teenage drivers paying more than those guilty of a DUI-related accident.

Insurance companies typically break down their coverage into three risk tiers: preferred, standard, and non-standard. Customers in the preferred tier are deemed the least risky and, therefore, pay the lowest rates, while drivers in the non-standard tier are considered the riskiest and pay the highest rates.

The cost of non-standard auto insurance is also influenced by the reason you require it. For example, if you have multiple accidents or traffic violations on your record, you will likely fall into the non-standard tier and pay higher-than-average rates. Similarly, if you are deemed too risky by your insurance company, they may cancel your policy, and you will have to purchase coverage from a company specialising in non-standard auto insurance, which will likely be more expensive.

To get the best deal, it is recommended that you compare quotes from multiple companies, as rates can vary significantly depending on the insurer. Additionally, shopping around, reviewing discount opportunities, bundling policies, and improving your driving record and credit score can all help lower your non-standard auto insurance costs.

How to get it

Non-standard auto insurance is a type of insurance for drivers who are considered high-risk. This includes drivers with a history of accidents, traffic violations, or other factors that increase the likelihood of future insurance claims. It is typically more expensive than standard insurance and not all insurance companies offer it.

• Understand the reasons for needing non-standard insurance: Non-standard insurance is typically required for drivers who fall into the "high-risk" category. This can include having multiple accidents, traffic violations, speeding tickets, DUIs, or a lack of driving experience. If you fall into any of these categories, you may need to explore non-standard insurance options.
• Shop around for insurance providers: Not all insurance companies offer non-standard auto insurance. Some major insurance companies provide non-standard coverage, while others have specialised subsidiaries that offer better rates for non-standard policies. It's worth shopping around and comparing quotes from different providers to find the most suitable option.
• Consider specialised high-risk insurance companies: Some insurance companies cater specifically to high-risk drivers. These companies may offer more competitive rates for non-standard insurance policies. Research and reach out to these specialised insurers to explore your options.
• Compare quotes and understand the coverage: When requesting quotes, provide detailed information about your age, driving history, vehicle specifications, and other relevant factors. Compare the coverage options and limitations offered by different insurers, as non-standard policies may have restricted coverage.
• Review discount opportunities: While non-standard insurance typically comes with higher premiums, you may be able to find ways to lower costs. Look into potential discounts, such as those offered for completing a defensive driving course or bundling multiple insurance policies with the same provider.
• Consult a licensed insurance agent: Navigating the world of non-standard insurance can be complex. Consider consulting a licensed insurance agent who can guide you through the different options, coverage limitations, and help you find the most suitable policy for your needs.

Remember that the process of obtaining non-standard insurance may vary depending on your location and specific circumstances. It's always a good idea to research the regulations and average insurance costs in your state to establish a baseline for reasonable premiums.

How to save money on it

Non-standard private passenger auto insurance is a type of insurance designed for drivers who are considered to be high-risk. This includes drivers with a history of accidents, traffic violations, or other factors that increase their likelihood of filing a claim. As a result, non-standard auto insurance typically comes with higher premiums than standard policies.

• Shop around: Compare quotes from multiple insurance companies, including those that specialize in non-standard or high-risk auto insurance. By obtaining quotes from different insurers, you can find the most competitive rate for your situation.
• Review discount opportunities: Look into potential discounts offered by insurance companies. For example, some companies may provide a discount if you complete a defensive driving course. Taking advantage of these opportunities can help reduce your overall premium.
• Bundle your policies: Consider combining your auto insurance with other types of insurance, such as property insurance, under the same insurer. Many companies offer bundling discounts, which can lower your premium.
• Improve your driving record: While this may not be a quick fix, working on improving your driving habits and maintaining a clean driving record over time can positively impact your insurance rates. Avoiding violations, driving safely, and minimizing claims can contribute to a better risk profile.
• Work on your credit score: If you live in a state that allows insurance companies to use credit scores as a metric for calculating rates, improving your credit score can help lower your premium. A higher credit score may be perceived as a lower risk, resulting in potential savings.
• Explore telematics-based insurance: Telematics involves using technology to monitor and track your driving behavior. Insurers can analyze data such as speed, braking, and mileage to assess your risk more accurately. Safe driving practices may lead to lower premiums with telematics-based policies.
• Take advantage of driver education initiatives: Insurance companies often offer discounts for completing safe driving courses or participating in educational programs. By improving your driving skills and knowledge, you may be able to reduce your premium.

Frequently asked questions