Guest Post

How might tickets and accidents affect your car insurance premiums? One speeding ticket in the last three years will likely not have a significant impact on your car insurance rates, unless it is a teenage driver. However, multiple tickets and accidents most certainly will impact your rates.

If you have experienced a large increase in car insurance premiums your best bet is to take time to receive comparison auto insurance quotes from competing insurance companies.

All insurance companies are not equal

The reason why it is important to request comparison car insurance quotes is because insurance companies charge differing amounts of money when tickets and accidents accumulate. Some insurance companies essentially want you to take your business elsewhere by increasing your rates substantially, while other companies will make your rate increase more reasonable.

Depending upon the company, the rate increase for multiple tickets or accidents can be most severe. Some companies may increase your individual rate two to three times the normal rate meaning that your car insurance premiums could double or triple! Or worse, you could be dropped by your insurance company altogether, being labeled as a high risk driver.

As the owner of an independent insurance agency in Cincinnati we witness the frustration of drivers who are penalized excessively by insurance companies for tickets and accidents.

Multiple tickets and accidents

If you have had multiple tickets or accidents what can you do to lower your car insurance rates?

Some may conclude that taking remedial drivers’ training courses would be the best option. Taking such a course may remove points from your driver’s license for the state in which you live and are licensed, but it will not help your insurance record with your insurance company!

The underlying reason is that remedial driver’s training does not necessarily change the behavior of the driver. It may remove the points from the license, but not necessarily the behavior that led to the tickets or accidents in the first place.

I distinctly recall as I was sitting in a class room for driver’s education many years ago, watching a gruesome video of car accidents and the victims being pulled from the wreckage, with the purpose of “scaring” teenage drivers into considering the seriousness of speeding.

Did it work for me? Absolutely not! My parents made the mistake of allowing me to drive a sports car they had purchased. On many occasions, I pushed the ‘pedal to the metal,’ one time exceeding 140 miles per hour with a few of my school buddies egging me on.

Remedial drivers training may remove the points from your driver’s license, but insurance companies will likely not remove the surcharge for tickets or accidents.

Changing your driving behavior is the best way to lower your insurance rates over the long term.

If you are in the unfortunate position to have a number of tickets or accidents on your driving record currently, contacting an independent insurance agency is your best bet to find the lowest rates on car insurance. The reason why is because only an independent insurance agent can truly shop the market for their clients.

Jack Thomas is an insurance writer and author with more than 23 years of experience in the insurance industry. Jack manages an independent insurance agency in Cincinnati, Ohio.

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By Kevin M

Conventional wisdom holds that once a car reaches a certain age and book value that the collision coverage portion of an auto insurance policy be canceled. But I may have stumbled upon a compelling reason why you might not want to drop the coverage no matter how low the book value of your car.

My wife and I own two cars, both of which have long since been paid off and at least one of which has a book value low enough that most financial advisors would recommend dropping collision. However, as both cars are of advanced age, we’ve been renting vehicles for the two or three long distance trips where flying doesn’t make financial sense. This saves a small fortune over the purchase of four round trip air fares and gives us use of a late model vehicle a good distance from home.

When renting a vehicle, one of the requirements of car rental companies is current and adequate auto insurance coverage, including collision and comprehensive. Had we dropped our collision coverage, we would be required to pay for coverage through the rental company.

Our most recent experience

One of our annual rental experiences ocurs every year for the Christmas holiday. We travel from our home in Atlanta to the Northeast where our entire extended families are located, a distance of about 860 miles. Now to give an idea as to why we endure the hassle of rent/drive for such a great distance versus a 2.5 hour flight, the reason is all in the numbers.

This year, the lowest price we found on round trip air fare for our family of four was in excess of $1500. We found we could rent an intermediate SUV for 13 days for less than $800, or about half the cost of flying. The car rental also provides two substantial advantages. We have a vehicle for the entire time we’re away and, with it being Christmas, we need to ferry holiday related packages and luggage coming and going, something that’s far less convenient and more expensive when done by air travel.

For the substantially lower price and the tangible advantages of renting a car, we’re willing to endure a 16 hour car ride each way. And as a bonus, this year we did an overnite stay in Williamsburg, Virginia, for an early Christmas dinner–18th Century style–at the Kings Arms Tavern in that historic community. An experience like that just isn’t in the cards when you fly!

The payoff

But back to the car rental. $793 for a 13 day rental of an intermediate SUV with unlimited miles is a pretty good deal, especially when you consider the busy time of year it’s happening.

Our regular auto insurance policy coverage extends to use of short term rental cars as long as the vehicle rented is in the same value class as the vehicles we already own. Translation: they won’t cover the rental of a Mercedes if your regular car is a Camry. Since we continue to maintain collision and comprehensive coverage, we’re fully covered for a car rentals.

Had we dropped our coverage as is often recommended, we’d be forced to pay $26 per day for coverage through the rental company. That’s $338 for 13 days, or about 40% higher than the base rental price. Now conveniently, $338 is close to the additional annual cost of keeping collision and comprehensive on our policy. It’s worth it then to keep the coverage just for car rental purposes and any additional benefit we might receive as a result will be in our favor. And again, we typically rent cars for two or three long distance trips per year to save wear and tear on our own cars.

Good deal, or am I missing something?