Despite what type of car you drive, age, or location, the most critical determining rating factor to an insurance company is your history driving. Your past driving history is what will give insurers the most insight into how much risk they are accepting to insure your car. If your record shows multiple at-fault accidents and tickets, the insurance company may provide you coverage at a higher rate to minimize their risk, or they may refuse you coverage altogether. Insurance companies will place potential future policyholders into three main categories.
Preferred is for those who have withheld a clean driving record for the past three to five years. If you are in this category, you are considered to be low-risk and will receive the lowest rates.
The standard category consists of those who hold a reasonably clean driving record. If you are in this group, you’ll pay a little more than the preferred rate.
The nonstandard category includes those who have a poor driving history of tickets, drunk driving or recklessness, and accidents. This group will be considered high-risk for insurance companies and will pay the highest rates.
All in all, if you are a safe driver and obey traffic laws, then you will have a lower premium than someone else who has a few speeding tickets. If your driving record isn’t spotless, it is up to your insurance company and their rating system (including what the violations were and when they occurred) to determine how much more you will pay.
You can receive a traffic violation or a ticket for numerous reasons. Some offenses are more severe than others. For example, illegal U-turns, failure to use your seatbelt, or failure to signal may be regarded as minor violations and not affect your premiums as profoundly.
However, violations such as reckless and drunk driving, running red lights, or hit-and-runs are more serious. The more serious your violations, the more likely it is to increase your insurance rate for an extended time.
Every licensed driver has a Motor Vehicle Report (a driving record). The driving records are on file in his or her states’ Department of Motor Vehicles (DMV). In most states, you can obtain a copy of your driving record for a small fee from the DMV.
The report will show the status of your license (whether it is expired, suspended, or currently valid). It will also show all accidents or traffic violations deemed to be your fault. Different states will keep violations on your report for varying periods; however, most states will keep them on your record for three to five years.
If you had the option to go to driving school or to erase the ticket, then the ticket will be removed and will not show on your driving record. Also, if you had a violation for a correctable offense and it was fixed promptly, that most likely will not show up on your driving record.
The only way to make your record clean is by being a safe driver. The good news is that every insurance company has a “look-back” period. For example, say that an insurance company has a look-back period of three years, then if you keep your record clean for the next three years, what you did before that will not show up on the insurance summary and will not determine your premium. Therefore, if you have no more violations within the look-back period, your insurance rate may go down during your next policy renewal.