High-Risk Auto Insurance: How it can Affect Your Finances

Thursday, April 6, 2017, 6:00 AM | Leave Comment

If you have multiple traffic violations or accidents on your driving record, you may not qualify for traditional auto insurance.

Instead, you may need to purchase high-risk auto insurance in order to comply with your state’s minimum auto insurance requirements.

This type of insurance can cost a small fortune, and it generally is not an ideal coverage option for any driver.

Your primary goal may be to improve your driving record so that you can qualify for more affordable insurance.

In the meantime, you will be affected both positively and negatively by your high-risk auto insurance policy.

  • High Monthly Expenses

    Because you do not qualify for affordable rates with the top auto insurance companies, you may have to pay a significantly higher amount for your auto insurance premium each month.

    Shopping for lower rates with Select Insurance Group and other insurers can help you to find a more affordable rate.

    However, while you have high-risk coverage, you can expect to have your monthly budget impacted by this costly expense.

    You may even have to make adjustments to your spending habits to ensure that you can afford your premium payment.

  • Limiting the Ability to Save

    Saving money is a top goal for many individuals, but your need to pay extra for high-risk auto coverage directly interferes with your ability to save more money regularly.

    You may, however, be able to decrease other expenses, such as your cable plan, to adjust your budget appropriately. By doing so, you may still able to save money while getting the coverage you need.

  • Reducing Your Liability Risk

    While there are some downsides associated with buying high-risk auto coverage, there are positives as well.

    For example, this type of coverage allows you to stay legal on the roads even though traditional coverage is not available to you.

    In addition, in the event you are involved in an accident, your insurance may pay for most of the expenses that you otherwise would have had to pay out of pocket.

High-risk auto insurance can be a lifesaver when you have no other insurance options available. After all, you simply must buy a policy if you want to be a legal driver on the roads.

However, as beneficial as this type of policy may be, you nonetheless want to transfer to a traditional auto policy with more affordable rates as soon as possible.

You can make an effort to drive more defensively and safely, and over time, you will notice that your driving record has improved enough to qualify for better rates.

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