| If there's anything that could drive your car insurance cost sky-high it's a drunk-driving (DUI) conviction.
According to the Insurance Information Institute, there is an
alcohol-related traffic fatality in the United States every 29 minutes.
Aside from the risk of killing yourself and others, drunk driving
carries with it serious penalties from your car insurance company.
Auto insurance
companies may check your motor vehicle record only once every three
years or when you're applying for a new policy. It's possible that
accidents, tickets and DUIs may never make their way to your official
motor vehicle record. However, if your insurer does discover your DUI
and classifies you as a "high-risk driver," shopping around at renewal
time is the best strategy, as rates will vary greatly among auto
insurers. On the other hand, a rate hike may be the least of your
problems; your policy could be cancelled or nonrenewed, especially if
you are currently in a preferred rate class. Then you'll be forced to
look for new car insurance with the double-whammy of a DUI and a
cancellation on your record.
| A rate hike may be the least of your problems. |
Laws
regarding DUIs and car insurance coverage vary by state. Most states
requires DUI offenders to get a form called an SR-22 from their auto
insurers, so you can't hide. This form proves to the DMV that you carry
liability insurance and removes your license suspension. An SR-22 also
requires your insurance company to notify the DMV if it cancels your
auto insurance for any reason. You'll likely have to file proof of
insurance for three — sometimes five — years with your state's DMV.
Some car insurance companies don't even offer SR-22 policies, so you
may be nonrenewed or cancelled because your company can no longer
provide what you need.
| SR-22 laws Delaware,
Kentucky, Minnesota, New Mexico, Oklahoma and Pennsylvania don't
require SR-22s, but if you have an SR-22 and then move to one of these
states, you must continue to meet the requirements of the SR-22 state
where the offense was committed. New York and North Carolina don't
require SR-22 filings at all.In some states there is a fee for SR-22s. Source: Progressive |
It's
possible that your insurance company will never find out about your DUI
conviction if you don't have to get an SR-22. A June 2002 study by the
Insurance Research Council revealed that as many as one-quarter of
driving convictions never end up on motor vehicle records due to lack
of shared information between courts and motor vehicle departments, or
because a conviction has been erased through alternative means, such as
driving school. If you get your charge reduced in a plea bargain, or
have a limited license suspension, such as 30 days, it's also very
unlikely your insurer will find out about your conviction. If your insurance company misses the conviction at the time
it happens, it may still have a few years to raise rates if the DUI is
discovered later.
Your ultimate destiny rests with your car insurance company.
For example, State Farm's action depends on which subsidiary you're
with. The insurer reviews rate-increase decisions on a case-by-case
basis. If you have a preferred policy with State Farm Mutual Insurance
Co. and receive a DUI, State Farm will likely move you into State Farm
Fire & Casualty, which is its standard-policy company for riskier
drivers and higher rates. If you're with Progressive, you will not face nonrenewal or
cancellation because of a DUI, but you may face a rate increase.
Progressive also reviews rates on a case-by-case basis, with multiple
factors such as age, gender, driving history and your vehicle model
going into your rate. It doesn't end there. Your DUI conviction will follow you if
you apply for life insurance and could affect your premiums there, too.
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