Lamborghini owners, drivers without prior coverage, drivers with a history of accidents and people with poor credit histories all have something in common when they get car insurance quotes: Insurers probably consider them “nonstandard” drivers.
Nonstandard doesn’t mean substandard. Insurers that sell policies for the nonstandard market still have to follow state insurance laws. But a policy for a nonstandard customer generally costs more for the same coverage than a policy for a standard customer, or it might include more restrictions.
When you apply for car insurance, you fall into a rating category according to how likely the insurer reckons you are to file claims.
Preferred, standard or nonstandard
"Preferred" customers are those considered the least risky. They have clean driving records, good credit and experience behind the wheel. They qualify for the lowest car insurance quotes as well as the best discounts and perks that insurance companies offer.
"Standard" customers are average drivers with decent credit and a decent driving record. Like preferred customers, they drive ordinary vehicles.
Nonstandard customers are the riskiest as far as insurance companies are concerned — because of either the type of cars they drive or their driving or credit histories. In addition, some companies consider customers nonstandard if they buy only the minimum amount of coverage required by their state.
Nonstandard auto insurance policies are available from many places — specialty insurers that focus on the nonstandard market (like The General), large insurers that have nonstandard divisions (like Titan, owned by Nationwide), and insurers like Allstate that also sell policies to preferred and standard drivers.
Are you nonstandard?
You’re likely to fall into the nonstandard tier if you:
Are a teen driver.
Have a foreign license and lack a U.S. driving record.
Have no previous coverage.
Had a lapse in your auto coverage.
Have been convicted of a serious violation, such as reckless driving or driving under the influence.
Have racked up a bunch of speeding tickets or other moving violations.
Have poor credit (if you live in a state that lets insurers consider credit history when setting premiums).
Are required to have an SR-22 or FR-44, a special form the insurer must file on your behalf to prove to the state that you have car insurance. Somes states require one of these forms for drivers who have had their licenses revoked or have been convicted of serious violations.
Drive a rare vehicle or supercar, like a Lamborghini or a Bugatti Veyron.
Check the fine print
Because they’re geared to higher-risk drivers or owners of rare or unusual cars, nonstandard policies may have some restrictions you wouldn’t find in a standard or preferred policy. For example:
Your coverage might not extend to rental cars, as it would under most standard policies.
The liability limits might not extend to “permissive drivers.” These are people who don’t live with you and are not listed on the policy but who borrow your car occasionally. Under a standard policy, permissive drivers generally are covered. Under some nonstandard policies, they are not covered when they drive your car.
A policy for a rare or classic car might limit mileage — for example, to 5,000 miles a year. Here are companies that offer the best classic car insurance.
Such limits and restrictions aren’t necessarily bad. They keep prices affordable and let drivers qualify for coverage they might not otherwise get if they could apply only for standard car insurance. A stripped-down policy might be right for you.
But make sure you understand the coverage and how it works when you get car insurance quotes. Read the fine print before you buy, so you don’t get caught by surprise later if you file a claim.
NerdWallet’s auto insurance tool can help you compare prices.