The High Risk Auto Insurance Pool

The High Risk Auto Insurance Pool
The cost associated with getting insured is dependent on the potential risks of a policyholder filing a claim and an insurer suffering a loss. Individuals that are riskier to insure in the eyes of carriers are far more likely to pay inflated premiums than motorists that pose a low-risk. Insurers have put much effort into assessing risks and take many factors into account when determining what classifies a driver as a high risk. Some of these factors are out of the control of consumers and others can be controlled to avoid paying higher rates for coverage.

Factors that are commonly used to determine premiums are age, gender, driving history, claims history, place of residence, type of vehicle and annual miles driven. Many of these items are taken into consideration by insurers and most tend to agree which types of drivers will land in the high risk auto insurance pool based on each factor. In some cases these “risky” motorists may have a hard time locating coverage and an even harder time finding an affordable rate. Many companies will deny a policy to such motorists while others may be willing to accept the elevated risks, but at an increased premium.

Who May Need High Risk Car Insurance
A person with numerous tickets and accident on a driving record can find themselves viewed as riskier to insure by carriers and may have to pay higher premiums for auto insurance than those with clean driving records. A trend of committing traffic violations or being involved in accidents indicates to insurer that the trend may continue throughout the policy term and although carriers do not pay any costs associated with tickets, things such as running red lights and stop signs, speeding and tailgating can all lead to accidents.

One almost immediate way to land in the high risk pool is by being convicted of driving under the influence of drugs or alcohol. Impaired driving is a very serious offense and dangerous, which can lead to accidents, injury and death. Not only will a conviction make the price of policies skyrocket, it could cause a motorist’s current insurer to drop them altogether. This is something that a motorist should avoid not only to keep premiums down, but to lower the chance of being involved in a serious accident.

When it comes to automobile coverage teenagers always have it rough, especially males. Drivers between the ages of 16 and 19 pay rates than any other age group (assuming that driving records are similar). The reason for this is simple, statistics show that these teens are 3 times more likely to be involved in an accident than more mature drivers.

Policy cancellations and lapses can also affect premiums. According to the Missouri Department of Insurance, Financial Institutions & Professional Registration an insurer can place a motorist in the high risk pool if they have not been insured in the last 30 days, although laws may vary in other states. Many factors can cause the cost of policies to increase and many can be controlled.

Source: http://www.onlineautoinsurance.com/learn/high-risk-drivers.htm