Car Insurance For High-Risk Drivers: Options And Solutions

Being labeled a high-risk driver can present challenges when it comes to obtaining car insurance. Whether you have a history of accidents or traffic violations, it is worth knowing that options exist to help high-risk drivers secure adequate auto insurance coverage. In this blog, we will explore the world of car insurance for high-risk drivers, focusing on options and solutions. This information is particularly relevant for residents across the San Fernando Valley, seeking auto insurance coverage despite their high-risk status.

1. Understanding high-risk drivers

High-risk drivers are individuals who insurance companies deem to have a higher likelihood of being involved in accidents or filing claims. Factors that contribute to a high-risk designation include:

• History of Accidents: If you have been involved in multiple at-fault accidents, insurance providers may classify you as a high-risk driver.
• Traffic Violations: Frequent traffic violations, such as speeding tickets, reckless driving, or DUI convictions, can result in a high-risk designation.
• Poor Credit Score: In some states, insurance companies consider credit scores when assessing risk, and a low score can raise premiums. California is not one of those states, because Proposition 103 does not permit credit history as an auto rating factor here.

What options exist if carriers decline you?

While obtaining auto insurance as a high-risk driver may be more challenging, there are options available:

• Non-Standard Insurance Companies: Non-standard insurance companies specialize in providing coverage to high-risk drivers. They have flexible underwriting guidelines that may accommodate drivers with a less-than-ideal driving record.
• The California Automobile Assigned Risk Plan (CAARP): California runs its own assigned risk plan for drivers who cannot find coverage in the standard market. It assigns the driver to an insurer, and every company licensed to write auto in California has to accept its share. Premiums are the same whichever company you are assigned to, installments are available, and no broker fee applies.
• California’s Low Cost Automobile Insurance Program (CLCA): a separate program, and the one people most often do not know exists. It is aimed at income-eligible good drivers rather than at drivers with poor records. Annual income has to be at or below 250 percent of the federal poverty level and the vehicle has to be worth $25,000 or less. The driver needs a valid California license and has to be at least 16. The liability limits are lower than the state minimum, at $10,000 per person and $20,000 per accident for injury with $3,000 for property damage, and they satisfy the financial responsibility requirement. Premiums vary by county, there is no broker fee, and payment plans are available. Uninsured motorist and medical payments can be added for an extra charge.

3. Solutions for high-risk drivers

While being labeled a high-risk driver may come with higher insurance premiums, there are steps you can take to improve your situation:

• Driving Record Improvement: Focus on improving your driving habits and maintaining a clean record going forward. Safe driving over time can help reduce your high-risk designation.
• Defensive Driving Courses: Completing a defensive driving course can demonstrate your commitment to safe driving practices and may result in insurance discounts.
• Good Driver Discount: California law entitles a driver who meets the good driver standard to a 20% discount. Credit is not a permitted rating factor for personal auto in California, so improving credit will not change an auto premium here.

4. Working with an insurance agent

An agent who writes non-standard business regularly is worth consulting. An agent can help navigate the options available and review the coverage available for your specific circumstances. They have the expertise to identify insurers who specialize in high-risk coverage and can provide personalized guidance.

Routes back to standard rates

High-risk drivers face unique challenges when it comes to obtaining auto insurance coverage. However, options and solutions exist to help you secure the necessary coverage. By understanding your high-risk designation, exploring non-standard insurance companies or assigned risk pools, and working towards a cleaner driving record, you can find coverage as a high-risk driver. Consult with an insurance agent who specializes in high-risk drivers to explore the options and decide on the coverage you need.

Remember, insurance requirements vary by state, so it’s essential to familiarize yourself with the specific regulations, and seek professional advice to navigate the complexities of car insurance for high-risk drivers.

At Schneiderman Insurance Agency, we go through the options with clients so the decision is an informed one. To learn more about how we can help you, please contact our agency at (818) 322-4744 or request a quote online.

Disclaimer

This article is provided by Schneiderman Insurance Agency for general informational purposes only. It is not legal, tax, financial, claims, or coverage advice. We are licensed insurance professionals, not attorneys, accountants, or financial advisors, and nothing here should be relied on as a substitute for advice from a qualified professional in those fields. This content is general in nature and is not a review of, or a recommendation for, any individual reader’s specific insurance needs, policies, or circumstances. Insurance coverage depends entirely on the specific terms, conditions, endorsements, exclusions, limits, underwriting eligibility, carrier, and facts of each situation, and the actual policy language always controls. We do not guarantee any coverage, pricing, eligibility, underwriting approval, or claim outcome. Reading this article does not create an agent-client relationship. To understand how these issues apply to your situation, please review your own policy and speak with a licensed insurance professional, and consult legal, tax, or financial advisors where appropriate.