Online Auto Insurance Basics

The Internet offers a plethora of online auto insurance services, making it possible for customers to access a wealth of information on auto insurance. These services allow you to request multiple quotes and compare rates to ensure that you get the best possible deal.

Most everyone can get auto insurance online, but still some consumers struggle because of their credit history. There may be several reasons why you can’t get insurance through traditional private insurance companies:

You have a poor driving record

You own a special, high performance car

You have not driven long enough

You have not owned your car very long and therefore have no insurance record

You live in an area where theft and vandalism losses are high

In this case, you have two options:

State assigned risk pools
State assigned risk pools operate under a system in which every auto insurer participates in proportion to the amount of business they do in that state on a voluntary basis. Each insurer must accept the motorists assigned to it, retaining the profit or absorbing the loss that comes with that customer. The premiums you will pay will be substantially higher under assigned risk pools than directly with a private insurance company, but at least you will be able to obtain coverage. To find the assigned risk pool or the equivalent in your state, ask your insurance agent or the state insurance department.

Get a policy from a private insurance company that specializes in “high-risk” drivers
You may find a better deal by checking with a private insurance company specializing in “non-standard” auto policies. These companies write policies for people with bad accident records, high-performance cars, or who live in “high-risk” neighborhoods. These companies also may be able to sell you more comprehensive coverage than is available through assigned risk pools. To get a list of companies selling non-standard insurance, contact your insurance agent, state insurance department.

Will Your Premium Go Up If You File A Claim?

You may be reluctant to file a claim because you fear that your premium will go up or your insurance will be cancelled. Practices vary from company to company. In general, an insurer will increase your premium by specific percentages for each chargeable claim made against your policy above a specific dollar amount. A chargeable claim is one the insurer considers primarily your fault. The percentages and ceilings vary from company to company. These increases generally stay on your premium for three years following the claim.

Your company may also decide not to renew your policy if your driving record gets markedly worse or you have several accidents. Different insurers have different rules about what constitutes an unacceptably bad driving record. But some accidents, such as those caused by drunk driving, will probably trigger a nonrenewal from virtually every insurance company.

If you have an accident but don‘t report it to your insurer, you are taking a risk, even if the damage seems minor. If the other driver sues you weeks or months later, your failure to report the accident might cause your insurer to refuse to honor the policy. And even if they do honor the policy, the delay will certainly make it harder for the insurer to gather evidence to represent you.