Business Insider published an article by Emmet Pierce to let consumers know “The Seven Most Terrifying Car Insurance Words.” These typically come up after some type of accident or driving violation, but in some cases it’s just because of your age. If you cause a car accident, a surcharge will be added to your auto insurance policy for a pre-determined period of time. The only ways to possibly get out of this added surcharge are appealing a traffic ticket and begging your auto insurer. But there is a good chance that you’ll just have to wait it out until your surcharge goes away.
Once your state mandates that you carry SR-22 insurance, the only way you will be able to get cheaper car insurance is by having a good driving record going forward and waiting out the time period of three to five years. An SR-22 form is a certificate of financial responsibility that high-risk drivers have to show the state government after an infraction such as a DUI. Auto insurance rates will increase because your insurer has to file these forms and because you are considered a risky driver.
If your auto insurance policy is canceled, you can be in a world of trouble. Not only are you no longer insured by the company with which you have a history, other insurers will be much less likely to offer you coverage because of the previous cancellation. Nonstandard insurance is reserved for drivers with a bad driving past and is not available from all auto insurance companies. This comes with a hefty price tag, but carrying nonstandard insurance, waiting out the average time period of three years, and driving safely are the only ways to get off the nonstandard insurance list.
Once a parent has to add a teen driver onto their insurance policy, rates can increase by 50 to 100%. This is because teens have a history of driving fast, using poor judgement, and lack experience. Teen drivers are three times as likely to get into a fatal car accident as drivers twenty and older. There are discounts for good students available and it makes a difference if your teen keeps a clean driving record starting at 16, but rates won’t go down significantly until the age of 25.
Many fees are being tacked on now for things like emergency response at an accident scene, even if you weren’t at fault in the accident. Look out for added fees on your policy. Finally, step-downs are used by some auto insurance companies. If someone is driving your car that isn’t listed on your policy, your insurer might have a provision to lower your coverage to state-minimum levels if they get into an accident. Most drivers are unaware they have this step-down provision, but it could cost you a lot of money. Check with your auto insurance company regularly to make sure you know the ins and outs of your policy and to see what discounts you may qualify for.