Falling into the high risk category of the auto insurance companies can be the worst nightmare for people. The high risk category means that the auto insurance company sees you as a major threat highly susceptible to injury and accidents. The reasons for placing you in the high risk list can be numerous. Let us examine what high risk actually means and how it can impact you.
Typically, any accident caused by you can push your ranking into the high risk category. The only exception to this factor is when you had maintained a clean driving record all these years, with the current incident being your first accident. Then, the insurance company might spare from placing you into the high risk list. If you are placed in the high risk category, you will be forced to pay a higher premium for your auto insurance for the next three years until these accidents get wiped out from your record.
However, if the accident was caused under DUI or DWI, these charges will remain in your records even it is single time offense and you enjoyed a clean record all these years. The auto insurance company will see you as a possible future threat for Driving Under the Influence or Driving while Intoxicated, and penalize you by placing you under the high risk category. So, always refrain from driving while intoxicated as it can accelerate the amount of premium payable by you.
Take pains to pay your premium on time. Failure to do so will put you under the high risk category. Even a single failure from your side can bring you into the negative list of these companies. Remember, the companies’ survival is dependent on the profit they can amass. When you miss a payment, it creates a gap in their earnings. If you make a habit of irregular payments, the auto insurance companies may be forced to reissue policies or reinstate old policies. So, it is always wiser to pay your bills and your insurance on time.
Another factor that is within your control, which can define the high level of risk, is the type of the car driven by you. If you are in possession of a new Corvette that enjoys a 505 hp, never in your wildest dreams can you expect to get pleasure from the same cost of insurance that you had while driving a Ford Explorer. Any resemblance to a ‘sports’ car or any car with greater horse power is sure to put you in a high risk category. This is because the power and the speed presented by the car increases the likelihood for accidents. Also, the cost of repairs in the event of an accident is higher.
In short, if are bent on lowering the cost of auto insurance, then make sure that you don’t ever have an accident, doesn’t own a powerful car and doesn’t drink and drive. If you have fallen into the high risk group, check with the agent on raising the deductible to bring the cost of insurance to manageable rates.