Non Standard Auto Insurance

Non-standard car insurance is designed for high-risk drivers or those requiring specialized coverage. Insurers classify drivers into preferred, standard, and non-standard risk tiers. Non-standard drivers face the highest insurance rates due to factors like multiple accident claims, young or advanced age, limited driving experience, poor credit history, foreign driver license, or license suspensions. Failing to find coverage from most traditional insurers, drivers must seek non-standard insurance policies, which provide coverage for high-risk drivers normally at a higher cost. It’s important to note that “non-standard” refers to the level of risk associated with drivers and not substantial differences in coverage options or claims handling. Motorists may still be able to get nonstandard vehicle insurance from a well-known insurer, their subsidiary or specialized insurers focusing on high-risk or non-standard coverage.

Standard auto insurance refers to a policy that follows the industry norms and typically is not restrictive, doesn’t have special conditions and is often competitively priced. They are offered to typical drivers with average risk profiles. Most drivers fall into this category, which is highly accommodative. For example, even if you have an accident and a ticket for improper turn in your record, if you are an over 25 years old driver with years of driving experience, continuous coverage and good credit score, you can still find a reasonably priced policy in the standard vehicle insurance market, especially if the accident was a few years ago. But a teenage driver with no history may require a nonstandard car insurance policy.

Why You May Need Nonstandard Vehicle Insurance:

The main reasons why people are placed in the non-standard category is that they are considered high risk for several reasons. This may be because of things they have done like accidents and tickets but also lack of history and experience may be enough at times, as well as having a riskier automobile to insure.

  • Teenage drivers are often considered risky but senior drivers can be included in this category too.
  • At-fault accidents and too many claims can easily result in non-renewal and place you in a non-standard category and get charged significantly higher rates.
  • History of serious or too many traffic violations and license suspension require non-standard car insurance.
  • Lack of insurance history or long lapse in coverage worry insurers so they consider these applicants a non-standard risk, requiring higher rates.
  • Having a poor credit can make you a high-risk motorist as nearly all insurers in almost all states look at credit score when they determine the premium and insurability.
  • Having a foreign driver’s license or similar special circumstances often means that you need to look for a non-standard auto insurance.
  • Driving an exotic, luxury, high-performance or rebuilt title car may place you in the non-standard category requiring you to look for specialist insurers.

Non-standard auto insurance can help drivers with multiple violations or accidents, a limited driving experience, a history of license suspension, unusual license, car or other requirements find coverage, even though they would usually be charged higher rates. When you run out of luck with typical insurers or cannot get a standard policy, you often don’t have much choice since you are required to buy at least minimum liability vehicle insurance to drive in virtually every state.

Key Difference between Standard and Nonstandard Car Insurance

Often motorists can buy non-standard automobile insurance the same way they buy a typical policy and have similar coverage. Yet there are a few key differences between these two classifications and they are:

Driver risk profile: If you are a typical driver even with one or two blemishes in your record but long driving and insurance history and good credit score, you can get standard auto insurance from most companies. Typically, drivers who are considered high risk and therefore deemed likely to make a claim are turned down by traditional insurers or placed into the non-standard category and charged significantly higher rates.

Costs: It is clear that once you cannot qualify for a standard policy, you are most likely to pay higher premiums. Having only a few companies you can go to doesn’t help in finding affordable coverage too. Some non-standard drivers may have to pay as much as twice or even three times higher rates in comparison to a driver over the age of 25 with clean driving record and good credit.

Restrictions: It isn’t always the case but you may have restrictions on your policy if it is nonstandard. For example, you may not be allowed to lend your car to other drivers or there may be limitations as to who you can lend to.

Limited coverage: At times, you may not be able to choose the coverage or deductible you want. For example, if you have a car with a rebuilt title, many insurers may not offer Collision and Comprehensive coverage.

Limited availability: Depending on the type of risk you are, you may have only a few companies you can get coverage from. Although, most high-risk drivers would be able to find coverage from even well-known carriers and the only difference would be the price of the policy, at times the options may be limited. For example, only a few companies may entertain a driver with a DUI on record.

Transitioning from Non-standard Car Insurance to Standard Coverage

Non-standard vehicle insurance companies offer an alternative solution when standard policies aren’t readily available and get drivers insured. At the time you may have no other options but buy nonstandard coverage. However, many factors that contribute to being categorized as non-standard, such as driving record, age, or the type of car driven, can be improved or resolved over time. If you believe you have made significant improvements and meet the criteria for standard coverage, it is important to proactively reach out to your agent or carrier and request a reevaluation, as they may not automatically recategorize you without your request. You can also get a few car insurance quotes online and see the reactions from traditional companies.

Usually, most automobile insurers look at 3 – 5 years history and if an at-fault accident was before this time period they may not take it into consideration in their premium calculations. Also, traffic violation tickets normally come off your record in 3 years for most violations and in most states. If you replace the high-risk auto with a typical sedan or you recently passed your driving test in the US and don’t need your foreign license anymore, you may no longer be considered nonstandard and start looking into standard vehicle insurance policies.