High Risk Insurance

Written By: Riley Waters on July 12, 2010 No Comment

Should you receive too many claims or traffic offenses in a short period of time, your standard insurer might decide to cancel your insurance policy. In most cases, your only option is to start shopping for high-risk driver coverage. Because all Canadian drivers have a right to insure their car, there are high-risk insurance companies that will provide specialized coverage at inflated premiums. This is a double edged sword, as it’s nice to know that you can always acquire coverage, but the high-risk premiums you receive can be shocking.

Most car insurance companies deny insurance for people who are considered high risk drivers because it is far more expensive to cover them. Standard insurance companies are in the business of earning profits for their shareholders, so they don’t like to pay out for claims too often. High risk claims often happen more frequently, and cost more. High risk drivers generally pay considerably more money for their insurance coverage as they pose a much higher liability to the insurer.

If you have made multiple claims or received several driving infractions recently things can spin out of control quite quickly. You can quickly find yourself on the lookout for a high-risk insurer. As a young driver, it is increasingly tough to find car insurance at reasonable prices. New motorists have a tendency to get into trouble. Leaving the scene of an accident is one frowned upon, as insurers view that as something you do if you were drunk, or being sneaky. Don’t buy a car with a poor reputation, as they are costly to insure. (If it has a really big engine and doesn’t go around corners too good, you might wish to rethink that choice) If your choice in vehicle can do in excess of 260 kilometers per hour your insurance likely won’t be cheap. Always let your insurer know if there are any safety features installed in your vehicle. Insurance companies especially like to know if you’ve got summer and winter tires, an anti-lock break system, and signal flares in your trunk. If you’ve been in several traffic altercations in a short period of time you might consider completing a driving course, and providing your certificate to your insurance provider. If you are a new driver, completion of a driving school certification can often reduce your perceived risk to your potential insurer.

High risk car insurance can be quite costly especially if you have been previously denied coverage. It can be difficult to find an insurance company that will provide you the appropriate policies for car insurance. Some insurance companies will offer you cheaper rates than others. Some companies probably won’t touch you. Your strategy should be to stand vigilant and keep your options open. You just have to look more thoroughly to find the right company that will accept you, and grant you an insurance policy. It is also a best practice to get many of quotes and compare them to get the best rates.

Your claims history and drivers abstract are key factors in establishing risk, and every insurer has its own method for calculating risk. These risks are calculated, and then used to obtain your rates. (If you are found to be worthy of their insurance.) You should fight any traffic ticket you receive, as every infraction established a perceived risk that can affect your eventual premiums.

Did you know that the premiums of most car insurance brokers vary vastly? Talk to a broker today and discover why these variations exist, and what you can do to prevent overspending.