As a licensed driver, you are probably aware that most moving violations that you are convicted of, as well as any accidents you may be involved in, may cause you to accumulate points on your driver's license. If you accumulate too many points within a specified period of time you stand the risk of having your license suspended. Fortunately, there are several ways to reduce these points. What you may not realize is that in addition to points on your driver's license, you are also accruing insurance points. If you accumulate too many of them, there could also be dire consequences.
What Are Insurance Points?
Insurance points like driver's license points, are penalties that are accumulated from any convictions that result from traffic violations. Unlike driver's license points, you can also accrue insurance points for an at-fault accident which only results in property damage, or bodily injury, even if your vehicle is the only car involved. The number of points that you accumulate is often determined by the severity of the conviction, as well as how much your insurance company has to pay out for the accident.
For example: In the state of North Carolina, driving while impaired may result in your driving licenses being suspended, but you will also receive 12 insurance points, which is one of the highest amount of points you can receive at one time. Once you have your licenses reinstated, you will still have to deal with the high insurance premiums which will result from the insurance points.
Some other offenses which will result in the accrual of a high number of insurance points in North Carolina are:
- Manslaughter or negligent homicide
- Hit and run
- Operating a commercial vehicle with a blood alcohol level of.04 or higher
- Transporting illegal liquor for sale
- Speeding to elude arrest
- Highway racing and more
There are exceptions to the rule. If you are involved in a single car accident that only has property damage, and the damage is below a certain amount, you may not accumulate any points at all. Another exception which may result in you not being awarded any insurance points is if you are convicted of going less than ten miles over the speed limit, and this infraction does not take place in a school zone. While this also depends on what the speed limit was in the area, many drivers will go to court to have a speeding ticket reduced to nine miles over the speed limit in an effort not to accrue points.
How Does Insurance Points Affect What I Pay For Insurance?
In many states, the rates you pay for insurance is determined by several different factors. Some of these are:
- Your driving record
- Your driving experience
- What type of car you drive
- Where you live, work, and drive
- How often your car is driven
- Where your car is housed/parked, if that location is different than where you live
Insurance companies will also consider any insurance points that you have accumulated in the last three years. The amount that your insurance premium will increase is directly tied to the number of insurance points that you possess. After you have accrued a high number of points, you run the risk of your insurance company refusing to cover you altogether.
For example: In North Carolina, if you have one insurance point, your annual premium can increase as much as 30%, if you have six insurance points, you may be facing an increase in excess of 130%. If you accrue twelve insurance points, your premium could increase as much as 340%. To give you a visual: If you have twelve insurance points, a $300 premium x 340% would end up costing you $1,320 per month.
Unfortunately, unlike driver's license points there is no way to make these points go away. They will remain on the driver's licenses for three years. The above illustration is for North Carolina, but you find the traffic laws in your state at ustrafficlaws.com.
What Can You Do?
The easiest way to keep your auto insurance from increasing is to abide by the driving laws in your state. Doing so will not only keep you safe, but it will keep your passengers safe, as well as anyone else who is on the road with you.
Having a clean driving record will show the insurance company they can trust you. When they trust you, they will be able to offer you a lowest rate they have because you do not pose an increased risk to their company. For more specific information, visit sites like http://www.collinginsurance.com/.Share