Do you have a poor driving record, history of claims, or driving convictions? You may be wondering: how much does high-risk car insurance cost? High-risk car insurance typically costs about 25% to 250% more than the typical car insurance. Individual insurance companies may deny coverage to very high-risk drivers.
Various car insurance types are mandated in Canada, and driving without car insurance is an offense punishable by law, which means that despite high-risk car insurance attracting more charges, you can’t simply choose to drive without insurance. While this is true, it doesn’t stop you from getting cheaper rates and exploring your options.
How much does high risk car insurance cost with an example?
Some of the most serious offenses that can have a remarkable increase on your car insurance premiums include impaired driving and stunt driving. If you’re paying the average insurance rate of about $1500 annually, the high risk car insurance may be up to 100% more. So, you may end up paying $3,000
How much does high risk car insurance cost Ontario
Overall high-risk insurance products will attract higher premiums, but different companies will have different rates. You should consider obtaining several quotes, and for consistency, provide accurate information every time you make a request and choose the same deductible amount. Generally, higher deductibles will lead to cheaper premiums.
Brokerages like Surex offer customers the chance to compare quotes from some of Canada’s top insurance companies. The top comparison sites tend to have advisors that may give visitors personalized advice so they can save money on their next insurance plan.
How do car insurance companies check for the driver’s history?
When applying for an insurance plan in Canada, it’s standard practice for the insurance company to obtain information about your driving history. They can formally request the 3-year or 5-year driver’s record. What information does it provide?
- Driver Identification details including your name, driver’s license number, date of birth, sex, height, class, special conditions (for instance, if you drive with glasses), license status, and expiry date)
- Active fine suspensions,
- Convictions under the Highway Traffic Act and Criminal Code of Canada
- Suspensions and reinstatements over the past 3 years
They may also order the Driver’s license history report to see if you completed driving educational courses. While companies are limited to order 3-year or 5-year driver’s records, they also have more means of obtaining additional information about your driving history from other third-party databases. Autoplus, the largest database of automobile policy and claims, may offer additional information, including if you have filed previous claims or being the subject of claims by other drivers.
What factors make a person high risk?
Violating laws under the Highway Traffic Act and Criminal Code of Canada may make you high risk. Non-serious offenses such as obtaining a parking ticket will not likely affect your rating. However, the following two mistakes will significantly affect the cost of your insurance premiums:
1. Stunt driving
In Ontario, stunt driving may attract a fine between $2,000 to $10,000 in addition to a possible jail term of six months and a 7-day impoundment of the vehicle. It entails exceeding the speed limit by 50 kilometers per hour, performing actual stunts, and acting out on your road rage.
The driver’s license may also be suspended for 7 days and suspended for up to 2 years upon conviction. It almost always results in increased insurance rates by up to 100%.
2. Driving under the influence
Charges for driving under the influence vary depending on whether you are a first-time offender or have a prior conviction. In Ontario, first-time offenders may have their license suspended for up to 90 days, face a 7-day vehicle impoundment, and pay a fine starting from $550. If driving-under-the-influence results in another person’s death, the sentence can be up to life imprisonment, and accidents resulting in bodily harm can attract a maximum sentence of up to 14 years. Driving under the influence of marijuana is now also considered impaired driving. A DUI always results in an increase in the car insurance rate by over 100%.
It’s not always mistakes that make you a high-risk driver. Reports show that car crashes are the leading causes of death among young people and the most vulnerable age groups are those between 15 to 19 years, followed by those aged 20 to 24 years. The higher risk of insuring young drivers is reflected in the higher premiums insurance companies charge. Based on recent road safety statistics from the Canadian Association of Chiefs of Police, those aged 16-24 accounted for 40% of speeding charges in 2023, and 27% of road fatalities result from speeding. Teens are also more likely to speed than more seasoned drivers.
4. Poor credit scores
You may be living in a province where the insurance company can review your credit score. Generally, drivers with good credit scores tend to enjoy cheaper premiums than those with poor credit scores. The argument made is that people who are more responsible about their finances also transfer the same behavior to their driving, and reports show that they file fewer claims.
5. Lapses in coverage
Failing to renew your insurance policy or having it suspended following failure to pay monthly insurance premiums may result in a lapse of coverage, and insurance will take this as high-risk behavior. Defaulting on insurance payments and having them go into collections hurts your risk rating and credit score.
6. Elderly drivers
Drivers who are more than 65 years old may also be placed into the high-risk category, and they may see their premium increased by a few percentage points.
So, how much is high risk car insurance? Well, it depends on the severity of your driving mistakes. But generally, you’ll be paying higher because of the increased risk. It’s better to maintain a good driving record than suffer the consequences of being labeled high-risk.