One of the factors that affect your insurance and premium rates is your risk profile. It can result in you paying a lower premium or a higher premium on your car insurance. In the worst-case scenarios, insurers would decline to quote for your car insurance.
What happens when you cannot buy auto insurance because of a less than ideal risk profile?
Your risk profile is based on several metrics, however, a few of the factors that can adversely affect it are, your driving records, your loss and claim history, any violations of regulations, cancellations of your previous policies, or lapse in coverage. Life happens and any number of things can happen that could mar your otherwise flawless driving and insurance records.
What can you do to fix your risk profile?
First, understand that with a tarnished risk profile, you are likely to receive a few rejections from insurance companies and when you are able to secure insurance, you may have to pay a higher premium to reflect the risk the insurance company is taking on. Do not despair. You can improve your risk profile and start saving on your auto insurance premiums again.
Start by assessing your situation, yourself, and the drivers of your vehicle(s). Examine where you can improve your risk profile(s) and show evidence that you are taking measures to do so.
Next step, although it does not have to be in this sequence, is to correct any traffic violations or regulatory violations as best as you can. Removing negative points from your driving records is aways helpful in improving your risk profile.
If you have been involved in many traffic violations or accidents, consider taking a safety and defensive driving class. This shows insurers that you are making efforts to improve your driving skills towards becoming a safer driver. It will also take 7 points of your negative driving records and save you money on the cost of insurance. Note that you are allowed to do this only once every 5 years.
Ensure to check with your state DMV to verify which safety and defensive driving courses are acceptable. At present, the Georgia Department of Driver Services does not accept online defensive driving courses or online traffic courses for traffic citations or point removal. See their website for certified defensive driving course providers.
If you are a safe driver or have become one, consider installing a telematic system in your vehicle. Several auto insurance companies offer this, and they use the data collected about your driving behavior to rate your premiums. This can help reduce your premiums by 10 to 20 percent. Most insurance companies will give you a discount simply by installing the telematic device and then use it to establish your driving behavior at the end of the policy period. The opposite is also true if your driving behavior leaves less to be desired.
There are a few things that you may not be able to change quickly like, where your vehicle is garaged. If it is located in an area where vehicle theft is rampant, consider adding car anti-theft Apps and devices to your vehicles if none has been built in.
Seek the help of a broker or an agent to buy insurance for your vehicle and keep it insured on a consistent basis unless you no longer own or have responsibility for the vehicle. You can be fined for not having insurance on vehicles registered to you.
When you purchase insurance for the vehicle, set up an autopay arrangement. This allows the insurance company to take installment premium payments from your credit card, debit card, or bank account on a pre agreed periodic basis. A nominal processing fee will be charged for this arrangement.
The use of autopay arrangement or paying the premium in full a few days prior to the policy inception date can garner up to 15% rate reduction on your car insurance premium. Contact us to explore other forms of discounts that may be available to you.
Know the coverages you are buying.
For many reasons most people will settle for the state required minimum liability insurance to cover bodily injury and property damage to third parties, however, note that, this will not cover injuries to you or damages to your own vehicle in an accident. If you lease or rent your vehicle or your vehicle is fairly new, it is advisable to buy additional cover that is available to you.
Auto insurance policies provide both the state mandatory and optional coverages. Let’s take a cursory look at coverages that are typically available to you on your auto insurance policy:
Bodily injury liability – covers accidental injuries to third parties.
Property damage liability – covers accidental damage to third party property.
Medical payment or personal injury protection – covers injuries to the driver and any passenger in your vehicle. It may also pay for loss of wages as a result of injuries sustained in the accident.
Collision – covers damage to your vehicle in an accident.
Comprehensive – covers all other damage to your vehicle including theft and vandalism.
Roadside assistance – as the name implies, it covers roadside assistance including towing charges.
Rental reimbursement – it reimburses you for the cost of renting a vehicle when the insured vehicle has been in an accident or is in repairs after an accident.
Gap insurance – covers the difference between the car’s cash value and what you still owe on a lease.
Excess Policy - This is a separate policy, and you may need it if multiple people drive your vehicle(s) on a regular basis. Excess policy pays in excess of the limits on your car insurance. It can be excess of your other policies, such as homeowners’ policies, or renters’ policies.
Call us if you have any questions. Let’s help you save on your car insurance for you and your family.
At Axios Risk Solutions, LLC., we help small and medium-sized enterprises, families and individuals minimize and manage their business risks through tailored risk management strategies and protect their business and assets through a variety of insurance solutions in the market. To request a quote or speak to a broker, call us at (404) 480 - 0272
Author: Sandra Owusu-Fianko
Sandra Owusu-Fianko is the Principal and Risk Advisor at Axios Risk Solutions, LLC. She has extensive experience in the insurance industry and a MS degree in Enterprise Risk Management. She is passionate about finding appropriate risk management and insurance solutions for her clients.
