Automobile Insurance
AUTO FINANCING

Slow down, drive safely, save on auto insurance

by Broderick Perkins

(11/24/2011) Erate Exclusive - You might rush to beat the rush out there on the road, but if you get a traffic ticket for a moving violation it'll accelerate the rising cost of your auto insurance.

Speeding, running red lights, ignoring stop signs and reckless driving, as well as certain accidents can push your auto insurance premium hikes into the fast lane.

Your state's Department of Motor Vehicles (DMV) maintains a record of your driving history and insurance companies examine these records (along with your credit report) when they go over new applications for auto insurance and when it's time for you to re-up on your policy.

Your DMV record contains information about any tickets for moving violations, driving under the influence (DUI) arrests, license suspensions or revocations, at-fault accidents and other information.

Depending upon the state, each DMV assigns a number of points for each infraction. The greater the infraction and the more frequent the infraction the greater the number of points and the faster they add up. In California, for example, a minor moving violation might get you one point, reckless driving can get you two.

The more points you rack up, the more insurance companies will consider you as a dangerous driver. If you've become a greater risk than when you first purchased your insurance, your insurer could decide to raise your rates.

You insurer can also refuse to renew your policy if your poor driving habits are getting near road rage levels.

It's not just that you can hurt yourself or wreck your car by driving recklessly, you could expose yourself and your insurer to lawsuits for personal injury and property damage.

A vehicle traveling at out of control speeds or in an erratic manner is like a loaded weapon pointed at everyone else on the road.

There is no universal formula for how many points boosts your rate and by how much, how soon, or even when an insurer will cancel your policy due to too many points.

Insurers generally make those determinations on a case-by-case basis, but Consumer Reports (CR) says drivers with just one moving violation can expect to pay, on average, about 18 percent more than those with a clean driving record.

Three violations can jack up the cost of auto insurance by 50 percent, CR says.

In some states, you can remove points from your driving record by attending driver school for safe driving lessons you were supposed to learn before you first received your license.

A certificate of completion from a state-approved driving course will reveal to the insurance company that you really want to be a safe driver.

Keep in mind, you'll also lose this option if you are ticketed for too many infractions within a given period of time and will have to live with those points and a higher insurance premium for years.

Those higher rates could stick around for up to three years, during which time you'd better keep your nose clean and driving record clear of tickets.

Also a clean driving record over time often will reduce your insurance costs. Again, how long you need a good driving record and how much your insurer will lower your rates varies from insurer to insurer.

If you get stuck with too many points and a higher rate from your current insurer, your only remaining option is to shop around, compare other insurers' premiums and perhaps raise your deductibles on portions of your policy.

Raising deductibles means you will carry more of the risk and if you don't change your bad driving habits, you'll only save money in the short term.

Continue to drive poorly and along with higher insurance premiums, you could end up, down the road, with additional moving violation costs and auto accident related liabilitycosts anyway.