How often do auto insurance companies check driving records?

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Things to remember...
  • Standard and specialty auto insurance carriers all check driving records before extending a household insurance
  • Carriers will check driving records when you’re applying for insurance and also when you’re policy is renewing
  • When you have a recent conviction on your driving record, it can affect the rate class that you fall into
  • Speeding convictions and other minor moving violations can be surcharged for up to three years in most states
  • Some carriers don’t check all driving records each renewal to reduce operations costs

Auto insurance companies have to assess drivers and predict whether or not they are likely to file a claim. If carriers didn’t go through this process, there’s no way for companies in the industry to set personalized rates and profit.

Pulling each driver’s motor vehicle record is perhaps the best ways for insurers to predict if there will be a loss based on the driver’s past experiences.

Your driving record is one of the most effective tools that insurers can use for rating purposes. Without a record of your driving infractions, insurers can’t really tell if you’ve maintained a good reputation as a driver or if you’ve had regular issues obeying the law.

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If you’d like to know more about driving records and their affect on your insurance, here’s a guide to help:

Why is your driving record so important?

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If insurance carriers charged someone who has a history of speeding the same rate as someone who’s had a clean record for the last decade, it wouldn’t be a good move. The driver who has a host of infractions on their record is much more likely to get into an accident.

Since accidents typically turn into claims, the carrier needs to take this into account before offering anyone coverage or the option to renew their current plan.

The insurer could just trust what the applicant has to say about their past, but those answers could be biased.

Ordering each person’s driving record is the only way to really verify that what’s being portrayed is true.

Do all insurance companies check your driving record?

If you’re worried about how your driving record will impact your rates, you might be looking for a way to avoid having your record pulled.

With so many carriers licensed to sell insurance, you would imagine that there would be a way around having your record run. Unfortunately, all companies will check driving record. This includes standard, preferred, and even commercial insurers.

Can your driving record make you ineligible for coverage?

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If you’re shopping around for insurance, your driving record could seriously affect your mission to find low rates.

Consumers who want to buy insurance from a preferred provider aren’t going to be able to meet the underwriting requirements if they have several tickets or accidents. Some preferred carriers won’t insurance you with just an infraction.

You’re better off shopping for coverage through a preferred insurer if you’re an experienced driver with a clean record.

If, however, you have had a blemished past or you’re inexperienced behind the wheel, you’ll have to go through either a standard carrier or high-risk insurer until you’ve proven that you qualify for a better rate classification.

What is a rate classification?

Some carriers sell coverage to drivers in multiple risk groups. These risk groups are more frequently called rate classifications.

When a driver gets a quote or renews their current policy, their claims record and driving record will be reviewed to place you into a class that directly affects your premium. Here are the common risk classes used:

How long will your driving record influence your rate class?

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It’s not necessarily the end of the world when you’re convicted of a speeding ticket. You will have to pay higher rates for a period of time, but you won’t fall into a risky rate classification forever. There is a cutoff where information on your report can no longer be used.

In most states, insurers are only legally allowed to use the minor infractions and accident information on your record for classifying you for three years.

If you’ve been convicted of a major violation for reckless driving or driving intoxicated, the information may affect your rate class for five to seven years.

How else will information on your driving record affect you?

Having convictions on your driving record doesn’t just affect where you can buy insurance and what class you’ll be assigned to. It can also affect your rates in the form of a policy surcharge.

A surcharge is similar to a penalty that you must pay for being cited for a moving violation and convicted of it. You can also pay surcharges for accidents.

In most states, each conviction that’s reported on your record can be surcharged for a period of up to three years.

The start date will be considered the date that the driver was found guilty of the infraction. Luckily, some states have ordered that the amount of the surcharge must be reduced from year to year.

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How much will the surcharge be?

Just like rates, surcharges are set by the insurer. Some carriers might not charge quite as much as others to stay competitive in the standard industry. Others might charge a huge surcharge to their drivers with just one infraction so that they insure a lower-risk pool of customers.

Even though the surcharges from carrier to carrier can be dramatically different, there’s still an industry standard. Some convictions are considered less serious and they come with a lesser penalty than others.

Here are the rate increases that you can expect to pay after specific convictions:

  • Reckless driving – 22 percent
  • DUI – 19 percent
  • Driving without license – 18 percent
  • Careless driving – 16 percent
  • Speeding 30+ – 15 percent
  • Failure to stop – 14 percent
  • Improper turn – 14 percent
  • Improper passing – 14 percent
  • Speeding – 12 percent
  • Failure to yield – 9 percent
  • No car insurance – 6 percent
  • Seat belt – 3 percent

Dates on your Driving Record Matter

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Insurers must pay close attention to dates when adding surcharges to your policy. If you were cited for speeding three years ago but weren’t convicted until last year, you could be surcharged for a remaining two years.

If you’re not convicted of an offense at your current renewal, you can’t be surcharged until the next renewal.

Another date that matters is when your license was issued and whether it or not it’s been suspended. This information can be found on your driving abstract.

If you’ve only recently gotten your license or you’ve had your license reinstated, you can still be a high-risk driver. Know how this impacts your rates before applying.

How do auto insurance companies order driving records?

There are a few ways that auto insurers can order your driving record. Each way will cost the carrier money, but some methods cost less than others. One of the more popular methods in the past was to order the record right through the state.

Unfortunately, some states don’t process requests instantly which can create a delay.

The next method is for insurers to order a driver’s motor vehicle report through a different risk solutions company that has access to state records and even claims records.

The most popular company that will offer instant driving record information for a fee is LexisNexis. While this option is faster, insurers will have to pay higher administrative fees to pull the records.

Is your driving record pulled when you get quotes?

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If you’re getting a quote for coverage, don’t assume that the agent already knows that you have a speeding or a failure-to-stop conviction. It’s not out of line to think that your record has been pulled but you have to keep the costs in mind.

If an insurer is giving you a free quote with no obligation to buy, they aren’t going to spend the money to run your driving record.

If the agent isn’t aware of your driving record when you’re applying for coverage, it’s reasonable to wonder when the carrier will see your convictions. It’s not when you’re soliciting a quote that the record is pulled but instead when you submit your application for coverage.

When the agent that’s quoted your policy submits the information, they are sending those details to an underwriter. Some agents have the power to run driving records to verify information in their office, but in most cases, it’s the underwriter that will do it.

After everything is reviewed, a final rate is calculated. That final rate could change if any rating information has changed.

When will your driving record be pulled again?

If you had a clean record when you bought your insurance and then were cited for speeding a month later, you’re not in the clear for long. Technically, the insurer can’t increase your rates in the middle of your insurance term because those rates are guaranteed.

That doesn’t mean that that infraction isn’t going to impact upcoming rates.

Typically, the insurance company will run your record again when your renewal is being run.

The renewal is run about 45 days before the policy is set to expire.

You will probably receive your renewal paperwork about 30 days before your new policy is set to start, depending on the state renewal requirements.

If it shows that you’ve been convicted of that speeding citation when the MVR is run, it will impact your renewal rates and eligibility.

Will the insurer run your record every renewal?

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When you’re a new client, the insurer will probably run your records each renewal. Some carrier will hold off and skip renewals when you’re a long-time consumer with a clean record. It’s not worth the cost of running a report if the client has kept a clean record.

Making one mistake behind the wheel can cost you for as long as three years. If you’ve been convicted of any type of infraction, make sure that you shop around for coverage online by getting instant rate quotes.

Sometimes it’s best to stay with your insurer and other times you’ll be able to find lower rates through competitors.

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