5 Tips For Buying Non-standard Auto Insurance

If you've racked up a bunch of speeding tickets or made a lot of car insurance claims, you might find yourself in the market for non-standard auto insurance.

Non-standard doesn't refer to the policy, but rather the type of driver buying it -- someone considered too risky for standard or preferred auto insurance rates.

"You probably are not going to know you're buying a non-standard policy, but your insurer will know," says Penny Gusner, consumer analyst for Insure.com.

You might fall into the non-standard category if you've had multiple accidents or claims, multiple moving violations, or a conviction for a serious offense like driving under the influence.

"That's going to be something that will cause an insurer to tap the brakes before offering you a quote," says Jeff Camara, a partner at Vargas & Vargas Insurance in Dorchester, Massachusetts.

You could also be considered non-standard if you're newly licensed or have a poor credit history, although some states such as Massachusetts don't let insurers consider drivers' credit histories to set rates.

Some car insurance companies, such as The General and Titan Insurance, specialize in serving the non-standard market. But you're not limited to those companies if you have a spotty driving record. Progressive Insurance got its start catering to higher risk customers, although it now also serves the broader standard market. Other major insurers such as Allstate, which traditionally served only standard and preferred customers, also write policies for non-standard drivers.

Here are five tips for buying non-standard auto insurance.

1. Get lots of car insurance quotes.

"You have to do a little legwork," Camara says. "It's not going to be as easy as someone with 10 years of driving experience and a clean record."

Insurance companies have varying appetites for risk, so don't give up if a couple of insurers turn you down - it's always wise to compare car insurance companies.

"You might get some refusals, but that doesn't mean you don't keep going," Gusner says. "There is competition in that market."

If you have a serious conviction, you might be required to obtain a FR-44 or SR-22 form, depending on your state. Your insurer files the form with the state to prove you have coverage. Not all insurers will file the form, but many do. As you're getting quotes, verify with the companies that they offer the filing service if you need a FR-44 or SR-22. Keep in mind you'll have to pay a one-time filing fee, typically about $35, on top of the premium.

2. Consider your state's assigned risk pool as a last resort.

If you can't get anyone to insure you, some states have an assigned risk pool. Insurers are assigned uninsurable customers on a round-robin basis. Maximum rates are set by the state.

Don't assume you're destined for the assigned-risk pool just because you have a few tickets.

"Sometimes people think they're a worse risk than they are," Camara says.

Get quotes from a variety of companies before resorting to the assigned risk pool. "Let the independent insurance agents do their job," he says.

3. Do the mirror test.

Decide the type and amount of insurance you want to buy, and choose the deductible before getting quotes.

If you want to maintain the coverage you already have, put your current policy in front of you as a reference guide, Camara says. Shop for policies that mirror one another, so you compare quotes for the same coverage.

4. Watch out for exclusions and limitations.

Some companies place tighter limits on policies for high-risk drivers. Gusner says those might include:
  • Double deductibles within the first 45 days of the policy.
  • No coverage for rental cars.
  • Step-down liability limits for permissive drivers. Normally your liability coverage extends in full to people you give permission to use your car occasionally. With step-down provisions, the liability limits drop to the state minimum requirements for permissive drivers, even if you buy higher limits for yourself.

"A no-frills policy might be right for you if you need cheaper rates," Gusner says. "You just need to be aware of what you're getting into."

5. Shop for car insurance quotes at renewal time.

Just because you fall into the high-risk category now doesn't mean you'll be considered a high risk forever.

Eventually violations fall off your driving record. The longer you maintain a clean driving record, the closer you get to qualifying for standard or preferred rates. Improving your credit can also help if you live in a state where insurers can consider credit history to rate drivers. Pay your bills on time, and pay off as much debt as possible.

Then shop for car insurance quotes again.

"It's worth checking once a year, if not every renewal period," Gusner says.