BY JELANI DANIEL
Insurance premiums are tough enough to tackle even with a spotless driving record. What happens when you have a not-so-clean driving history and a fiery investment into a new sports car? You have a high-risk formula for increased insurance premiums.
HOW RISK WORKS:
Low, intermediate and high-risk are contributing factors when brokers calculate your insurance premium. What you may not know, your driving history as well as the make or model of your car (year included) are considered forms of risk.
Vehicles themselves can be ‘high’ or ‘low’ in terms of risk depending on the model, as well as the year. For instance, in Quebec, the motorcycle Aprilia ranks the highest in risk, just above BMW, then Ducati. The 2014 models of each were considered less risk than all the 2015 models mentioned, showing the younger bikes were a cause for increased risk. Therefore, the make is a major factor (speed, color, etc.), but the year is a primary determining factor.
Your driving record is another factor taken into consideration when looking into what premium to charge the driver. If the driver has had a series of accidents, regardless of fault, it shows a higher likelihood that the insurance will have to pay money to the driver in the future in the case of an accident.
It is not uncommon for the accident to not be the fault of the driver due to unavoidable weather conditions from long commutes or an irresponsible driver that hits them. Regardless, the driver pays the premium, but the good news is that your driving record (if not criminal) will likely be clean after roughly three years for minor traffic violations.
THE LOW RISK FORMULA:
If you want to lower your insurance premium, a low-risk formula is the best way to manage your money. Using a low-risk car and driving with care are the two best ways to minimize risk. If you have long commutes, try to use public transit to lower the chance of an accident or carpool with colleagues.
Overall, if you want to drive a high-risk vehicle, it is best to be a low-risk driver, but still prepare for a higher premium than a low-risk vehicle.