High-risk drivers are a burden on society. They make our streets unsafe and they pose a risk to your car and your wallet. You could be the safest driver in the world, but one way or another, high-risk drivers are costing you more in auto insurance. You just might not know it.
We all know auto insurance companies make money by charging you a premium to cover your car in case of accidents and other incidentals. The best case scenario for the auto insurance company (and you, for that matter) is that you never actually need to file a claim, because that’s when they lose money.
If you’re a safe driver, you may be eligible for additional discounts besides low auto insurance rates. But what if you’re a bad driver? A high-risk driver? In that case, you are a liability for insurers.
To price that cost in, insurance companies are forced to spread the risk around by increasing premiums across the board, not just on the high-risk driver’s policy. So when an insurer is exempt from having to cover high-risk drivers–like the new entrants in Massachusetts–it actually creates an unfair advantage over their competition.
A primary staple of capitalism is increased competition is bad for business, but good for consumers. The reason is because it is in each party’s own self-interest to seek the best option available. If one party outweighs the other, a shift in the spectrum occurs, and the minority will benefit because there is increased demand in the supply they provide.
Fewer companies selling a certain product means there is less competition and fewer choices for consumers to choose from. Conversely, more companies jockeying for the same position means consumers have the upper hand.
So while exemption for high-risk drivers may not be fair for those insurance companies left in the cold, it actually creates an advantage for auto insurance shoppers:
In the case of Massachusetts, the exemption for new entrants end in two years. This provides new insurers with an incentive to enter the market, thus creating more competition benefiting consumers, but also balances the playing field once they are established.
Of course, the group left in the cold is the actual high-risk drivers. Their options are limited and they are vulnerable to jacked-up prices from the insurance companies that can and will cover them.
A high-risk driver is anyone whose record indicates they are more prone to car accidents or other incidents:
If you’re one of the unfortunate ones deemed a risky driver, go over the list above to see what you can fix. You can try taking extra safety driving courses to try and lower your premiums, or change your ride to one deemed safe by your insurer.
For the inexperienced, there isn’t much you can do about that except get a few more repetitions under your belt. However, you can try to piggyback onto the policy of a friend or relative who is a safe driver. This could help you to lower your premiums, but could also negatively impact what they have to pay.
Keep in mind, though, while premiums are important, there are many other factors to consider when picking the right auto insurer for you.
Getting in an car accident is something you don’t ever want to be in, but accidents happen. But what happen if you got into a car accident and the other driver doesn’t have a auto insurance or the other driver just drives away. What do you do next?
Over in the UK there is a company called Motor Insurers Bureau (MIB) which specialized in this kind of accidents. They help the victims compensate for the negligent uninsured and untraceable motorists. In the other hand, we’re not sure if there is such a company in the USA or Canada.
Just because we can’t find a company that specialize in this kind of auto insurance in the USA and Canada. Don’t let that stop you from searching on your own. If you do
Many risks are involved with younger drivers, therefore increasing prices on car insurance. Although, more risks are involved with younger drivers, there is the possibility to find companies with lower rates. Here are some tips to help you find the best car insurance for young driver’s.
Car insurance companies are well aware of the risks involved with younger drivers and usually make you may for this. In some cases you can find yourself paying higher than 50% on average more than others. Even so, while shopping around, keeping some things in mind will help with your search.
When a younger driver starts off with creating their history with driving, it is important to keep a clean record. Read more…