Traffic can be crazy in Calgary, and accidents are common (especially during the winter). Unfortunately, they are more common for some than others! Insurance companies are in the business of assessing risk, and car insurance is based on a variety of factors – including your chances of being involved in an at-fault accident. As well as their past driving performance, drivers are evaluated for their premiums according to a wide range of factors such as:
- Their age
- Their relative level of experience
- The type of vehicle they drive
For insurance companies, the bottom line is simple: greater risk means higher premiums. In other words, high-risk drivers pay the highest rates.
Are You a “High-Risk” Driver?
Here is a closer look at the myriad of factors that could lead you to be labeled as a “high-risk” driver:
- Age. On the whole, teen drivers have the highest insurance rates, for two reasons. First, statistics show that teens have relatively high accident and traffic violation rates. Second, young drivers have less experience, and tend not to make the wisest and most conservative decisions when behind the wheel. Generally speaking, the older you are, the less risk you pose…unless, of course, your driving record speaks to the contrary.
- Traffic violations. Drivers who have accrued traffic violations of any kind are considered more likely to be in an accident, which in turn makes them more likely to file an insurance claim…which means they pay higher car insurance rates. Traffic violations include everything from at-fault accidents and speeding tickets to running stop signs or stop lights. These violations result in demerit points being applied to your license, and once you start to lose points, your insurance rates will go up.
- Impaired driving charges and/or convictions. Drinking and driving will get you in trouble with car insurance companies very quickly, and you’ll feel the effects for a long time. Some insurers don’t pay any attention to whether or not you were even convicted of the charges; a drinking and driving arrest is enough to trip a red flag on their end. Note that it doesn’t matter whether or not you were involved in an accident as the result of drinking and driving; a simple arrest or a single conviction can be enough to send your rates skyrocketing.
- Lack of prior insurance. If you have never carried car insurance before, you will automatically be subjected to higher premiums. This is because the insurer has no frame of reference for judging your risk, so you will have to prove yourself not to be a risk before you’ll see your rates start to come down.
- The type of vehicle you drive. What you choose to drive also has a major influence on the insurance rates you pay. Luxury vehicles, high-performance vehicles and high-performance motorcycles all cost more to insure on average.
Also, homeowners are generally considered to be safer drivers by most insurance companies. If you do not own a home, you may have to pay higher car insurance premiums, since insurers tend to consider homeowners safer and more stable. In fact, many insurers offer homeowners discounts on their car insurance if they also carry a homeowners’ insurance policy through their company.
Insurance companies are experts when it comes to predicting risk, and if you’ve been tagged as a high-risk driver, chances are the insurance company has a good reason for classifying you as such. In fact, if you are considered a high-risk driver, your insurance company may choose not to renew your policy or cancel it outright, and some will not insure you at all. If you’re a driver facing that kind of situation, what can you do?
Working With an Insurance Broker
If you are considered a high-risk driver, you may find it difficult to purchase insurance directly from an insurance company. In that situation, your best bet is to work with an independent insurance broker, who deals with multiple companies and shops around for the lowest possible rates on your behalf.
Brokers have privileged relationships with insurance companies, and they may be able to negotiate coverage that may not otherwise have been offered to you. What’s more is that they can leverage these relationships to find you the best available rates; insurance brokers work for you, not for insurance companies, so both you and the broker have shared interests when it comes to shopping around for car insurance.
The Lane’s Insurance Advantage
At Lane’s Insurance, we believe that everyone deserves the benefit of the doubt when it comes to car insurance. If you’re struggling to find an insurance company that will cover you, or if you’re stuck in a situation where your insurance company keeps jacking up your rates or refuses to renew your policy, contact a Lane’s Insurance representative. We’ll work closely with you to ensure your coverage needs are met at a price you can afford, giving you the chance to prove yourself through responsible behaviour and enjoy the lower rates that come with reduced risk.
