How Impaired Driving Affects Insurance Premiums
Getting convicted of driving under the influence or while impaired is a trying experience to say the least. A driving under the influence (DUI) conviction usually comes with expensive fines, driver's license suspensions, and possible prison time. In addition to the legal ramifications, you will have to face the effects the breach will have on your car insurance rates. Once you receive an infraction, your insurer may raise your premiums or even cancel the agreement. Read on to find out how and why a DUI/DWI conviction will affect your auto policy and rates.
Consequences You Can Expect: License Suspension, SR-22 Filings
Once you receive a conviction, your driving record will reflect the offense. When your carrier checks your driving record at the time your plan renews, the conviction will show up, and your provider will raise your rates and could possibly drop you from coverage. Likewise, anytime you go to apply for a plan with a carrier, the DUI offense will show up and work to your detriment.
Most states will require you to file an SR-22 after a DUI conviction. This is a document filed with your motor vehicles department proving that you carry the minimum amount of coverage that your locality requires. Your provider may file the SR-22 for you automatically, but you should ask your agent about your carrier's specific procedures. Certain jurisdictions may require drivers with impairment convictions to file an these documents for multiple years. How long the SR-22 stays active will depend on the circumstances of your DUI and your state's laws. Remember that this document on your record will put you in a higher-risk category as a driver, so your rates will increase. Your rates will not return to normal until you are no longer required to file.
License Suspension or Revocation
A driver's license suspension or revocation may follow a conviction. If your license is suspended temporarily, you will need to let your provider know right away. You may have to cancel your plan until you get your license reinstated. If you need to switch carriers, you will not be able to apply for protection until you have a valid driver's license. With some carriers, you may be able to apply for a plan if you have a provisional license.
How Your Policy is Affected
Those who have been caught driving while impaired are more likely to file claims, which means car insurers will see them as higher risk. To offset this risk, providers will charge higher premiums. In places that apply penalty points to driver's licenses for violations, a DUI will add points to your record. With most providers, you will pay higher rates if you have points against your license. Certain carriers may even refuse you coverage or cancel an existing policy if you have a DUI on your driving record.
So just how high will the cost of your plan rise after being convicted? That will largely depend on your driving record and your carrier. Don't be surprised if your rates double, triple, or even quadruple after the offense. Your insurer may also move you to a subsidiary that writes policies for high-risk drivers if you were in a preferred-rate class at the time of the incident. Typically, your rates will remain elevated for three to five years following your conviction.
Policy Cancellation after an Offense
When your insurance company finds out you have received a conviction, one of three unpleasant consequences will occur: a spike in premiums, non-renewal, or cancellation. Convicted drivers frequently ask if their provider has the right to cancel coverage following a conviction. Insurance companies do in fact have this right, provided they follow the cancellation guidelines set by your state.
The laws of your jurisdiction will stipulate how an auto insurer must proceed with a coverage cancellation after a conviction for it to be valid. These laws can vary significantly around the country. For example, in Nebraska, auto insurance companies can cancel a policy at any time as long as they send a written cancellation notice to the insured motorist at least ten days before the effective date of the plan cancellation. As long as your provider complies with your state's parameters for cancellation, they have the right to terminate the agreement once you receive a DUI.
Alternative Coverage: High-Risk Pool
In the event you are dropped by your provider after a conviction and cannot find coverage on the private auto insurance market, you may have the option of purchasing a policy from your state's assigned-risk pool. Don't count on this option being cheap, though. For instance, in Illinois, high-risk coverage will cost you an extra $1,500 annually for three years, on average.
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