What Is Non Standard Auto Insurance?
There are generally two types of auto insurance available to drivers: standard coverage and non-standard coverage. Standard policies are less expensive and are issued to good drivers with solid driving histories. Non-standard insurance is issued to drivers with subpar driving records or who do not have prior insurance coverage. Non-standard premiums are normally much higher, and can cause a driver to reduce coverage amounts so he can afford the policy.
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Driving Record
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A driver can end up with a non-standard insurance due to her past driving record. In many states, a DUI conviction will result in the termination of a standard policy, meaning the driver would only qualify for non-standard coverage, assuming the driver holds a valid driver's license. An accumulation of traffic violations over a period of time, as well as numerous at-fault accidents, could also mean the driver may only be able to obtain coverage in the non-standard market.
Lack of Prior Insurance
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A lack of previous insurance coverage or a lapse in existing coverage can also mean a driver may not be able to obtain a standard policy. Since many insurers require a certain amount of driving experience or previous insurance coverage for a predetermined time frame, the drivers may not meet the underwriting guidelines to qualify for a standard policy.
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Vehicle Type
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Some insurers will also consider certain types of vehicles to be ineligible for standard coverage, even if the driver has a satisfactory driving record. Vehicles such as high performance sports cars or those that are custom built may not meet the safety standards of regular vehicles, or may have a higher incidence of being involved in accidents. In some cases, the driver may be able to obtain more favorable rates from an insurer that specializes in covering these types of vehicles.
Conversion to Standard Insurance
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Some insures may write a standard policy after an insured driver has been in the non-standard market if certain conditions are met. These can include having continuous non-standard coverage for a specific length of time, going a certain amount of time without having any at-fault accidents or violations, or obtaining the necessary driving experience.
Pricing
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Rates for non-standard auto insurance tend to be much higher than those in the standard market. Therefore, it makes sense for a potential insured driver to obtain quotes from several insurance carriers to obtain the best rate. Reducing coverage amounts to the minimum required by the state of residence will help to reduce the premium, but could leave the driver woefully underinsured in the event of a major traffic accident.
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