What is a High Risk Driver?

High Risk Driver Equals High Rate Insurance

Teen Driver
••• Bojan Senjur/Getty Images

The term high risk can be used in different ways when applied to car insurance and drivers. Sometimes a high-risk driver refers to one driver being a higher risk driver than another. It can also be used in reference to a driver not eligible for insurance through a preferred carrier. In very serious cases, it can refer to someone who has to have a special form completed and filed with the government in order to have car insurance at all -- but this is usually for high-level offenses that result in death or serious injury (or racking up one too many minor offenses).

You can be sure that if you’re in this category, you are definitely a high-risk driver. Therefore, most drivers are a higher risk than those few so-called perfect driving risks.

Most of these high-risk drivers do not get the very best insurance rates. Sometimes it’s because they don’t know how to find insurance they’re qualified for easily, and other times it’s because they’re legitimately an expensive risk for an insurer to take on. Four of the most common ways to NOT get the very best rate include:

1. Not having the Best Insurance Credit Score

If your insurance company sent you a notice stating you are not getting the very best rate because of your credit score, don't panic. The very best score is extremely difficult to obtain. You may still be getting a very good financial stability discount with your current credit score. Insurance companies have tied credit scores with the probability of a claim. So if you do not get the very best credit score, you are considered a higher risk than someone with the best score.

2. Having a Traffic Violation or At Fault Accident

Even one traffic violation puts you at a higher risk than someone with none. It can be frustrating when you have gone years and years with no tickets to get a surcharge for one small lapse in judgment. Some insurance carriers do offer an extra bells and whistles type coverage which would waive a single minor violation per driver. However, you do pay a small fee to get a ticket waived.

The same goes for at-fault accidents. Filing a claim is a sure fire way to become considered high risk. Sometimes even not at fault claims can raise your rates. Insurance carriers have come up with a way for you to avoid those increases by purchasing Accident Forgiveness. It is an extra option which you would pay extra for in lieu of a surcharge after an accident.

3. Being a Teen Driver

It is true, young drivers do not have to do anything wrong to be considered a higher risk than a seasoned driver. Their age alone instantly puts them in a high-risk price range. So many young drivers are in accidents and have traffic violations which increase the severity of already high-cost insurance. All drivers go through this period of high risk.

4. Not Owning a Home

Normally the term high risk and non-home owner do not go together. But, the homeowner discount can be so good when you think about it, non-home owners must be considered a higher risk than homeowners in the eyes of insurance carriers. Insurance companies like stability and owning a home is a large part of the stability factor. Several online insurance companies do not rate based on home ownership.

High-risk driver meaning a driver who does not qualify for a preferred carrier is the most common use of the term. Three common ways to be a true high-risk driver include:

1. DUI/DWI

Most drivers know a DUI means higher insurance rates, however, many are surprised to see a cancellation notice from their preferred carrier after the ticket. Preferred carriers do not tolerate major violations. Once a preferred carrier is aware of your major violation, your policy will be canceled at renewal.

2. Multiple Traffic Violations

Multiple violations tallying more than six points typically means you will no longer qualify for a preferred insurance carrier. It can be a mishmash of tickets and at-fault accidents to create the seven points or more. When it comes to at-fault accidents the police do not have to issue a ticket for insurance points to be added to your record. A single car accident with a claim paid out is always an at-fault accident regardless of the circumstances.

3. No Prior Insurance

Driving without insurance is against the law. Unfortunately, very few exceptions are made for drivers with no prior insurance. Driving a vehicle is so common in our daily lives, insurance companies have good reason to believe you drove at some point in time without insurance. Having a valid driver's license means you need to have car insurance in some form. Without proof of at least six months of continuous insurance, you are considered a high-risk driver.

Every insured individual is a driver risk of some sort. Not many drivers qualify for the very best rate. High-risk drivers always have room for improvement. Knowing where you stand is the first step in improving your record.