Do traffic violations affect insurance?

Car insurance is calculated based on factors that indicate how likely a driver is to file a claim, including age, driving history, car type and mileage. Insurance companies do not release the specific algorithms they use to calculate prices, meaning that each insurer will offer a slightly different rate to the same driver.… read full answer

Since each company calculates premiums using its own individual system, it’s important to get multiple quotes while shopping for insurance. Checking rates from several insurers is the best way to get the lowest price for whatever coverage you need.

It’s also important to note that car insurance is regulated at the state level, so the factors that usually go into calculating rates might not all be considered in every state.

Factors Affecting How Car Insurance Is Calculated

• Age. Teenagers and seniors are the most high-risk, although insurers also consider years of driving experience.

• Coverage levels and state requirements. Each state has its own minimum requirements for insurance, but customers can also choose full coverage or higher liability limits, along with many other optional add-ons. Consequently, more coverage will mean a more expensive policy.

• Claims history. Besides driving history, your previous claims show an insurer how often you cost insurance companies money in the past, thereby hinting at future behavior.

• Coverage history. Although it can seem unfair to drivers who previously didn’t have a car, insurance companies consider you higher risk if you have a gap in your history of insurance coverage.

• Credit History. Most insurance companies use a credit-based number called an insurance score when calculating rates, since credit is shown to correlate with the likelihood of filing a claim. However, not every state allows the use of insurance scores, and many states have some consumer protections in place to restrict their use.

• Deductible. A higher deductible means a lower premium, since your insurance company will have to pay less if you file a claim.

• Driving record. Speeding tickets, at-fault accidents, and serious violations like DUI or reckless driving indicate to an insurance company that you are particularly likely to cause damage with or to your car.

• Gender. Young male drivers are the most expensive to insure, although the gender-based difference in price gradually evens out. As with insurance scores, some states have banned the use of gender as a rating factor.

• Location. Certain areas are low in crime and less of a risk to insurers, while others have plenty of traffic, high crime rates, and/or destructive weather.

• Marital Status. Premiums are usually cheaper for married people, since they are statistically less likely to cost an insurer money.

• Mileage and car use. The more time you spend in your car, the more likely you are to cause a crash, so insurance is often more expensive for commuters, as well as people who use their cars for business reasons.

• Occupation. Certain jobs, especially those that involve late hours and stressful environments, will make your insurance company think you are extra likely to be in a car crash.

• Storage and Parking. Depending on the insurer, you may be charged less if you park your car in a garage rather than on the street, and long-term storage policies are much less expensive than standard policies.

• Vehicle. Insurance companies judge cars on how expensive they are to repair, how likely they are to be stolen, and how fast and powerful they are.

Some of the factors used to calculate car insurance premiums are beyond your direct control, but there are still steps you can take to save on insurance. You can adjust your deductible and coverage level, for example, although you should never jeopardize your future financial stability to lower costs right now.

In addition, you can focus on improving your driving record and credit score. Looking for car insurance discounts and comparing multiple quotes will also help your wallet.

Insurance companies find out about tickets by checking a driver’s record. Prior to renewing an existing policy or selling a new one, insurers will check a driver’s Motor Vehicle Report (MVR), which is a report of their driving history from their state’s DMV. Any traffic violation will show up on an MVR, so an insurance company is certain to find out about it once it’s on the record.… read full answer

If you can prevent a ticket from going on your record, however, then the insurance company has no way of knowing about it. Many states will allow a ticket to be dismissed if you attend and pass a defensive driving course, especially if it’s a first offense. You could also contest the ticket in court.

If your ticket does end up on your driving record, you should contact your insurance company in order to find out how your rates will be affected. For example, there’s a chance that a low-level speeding ticket on an otherwise spotless record might not raise your rates at all. And even if your rates do increase, they’ll usually go back down after 3-5 years of safe driving.

The cost of car insurance will go up at least 20% or around $200 after most types of tickets. Exactly how much your rate will increase depends on the seriousness of the violation, your insurance company, your prior claims and driving history, your age and location, and other factors. For example, insurance goes up roughly 30% after a ticket for spending 30+ MPH over the speed limit, while a ticket for lower levels of speeding will cause rates to go up by about 20%.… read full answer

Most tickets will affect your rate for three to five years, but it depends on the seriousness of the infraction and state laws. Driving drunk can impact your rates for more than 10 years, for example. In Florida, DUIs stay on your record for 75 years. And states like Indiana, Kentucky, and Minnesota treat seatbelt violations like parking tickets, which affect rates for less time than a moving violation. The amount of time a ticket will affect your insurance rate is very dependent on the laws where you live.

How Traffic Tickets Affect Insurance

It’s also worth noting that traffic tickets might cause some drivers to lose valuable safe-driver discounts, which would affect rates even longer and more dramatically. Let’s say your annual premium is $1,500 and your save driver discount is 25%, bringing the price down to $1,125. But you got a speeding ticket, increasing your premium by 20% and eliminating your safe driver discount. Now you’re paying $1,800 per year—full price plus 20%, costing you $675 more than you were paying before the ticket.

After three years, the speeding ticket might fall off your record, allowing your rates to go back down to full price. But you’ll probably have to wait another two years to earn back your safe driver status since most insurance companies look back five years for eligibility.