If you’re having trouble getting car insurance because of a lapse in coverage, an at-fault car accident or a DUI, you may need a policy from a nonstandard insurer, also known as a high-risk auto insurance company. Nonstandard companies sell car insurance to drivers who are the riskiest to cover and may not be able to find policies from standard companies.
Because of this risk, nonstandard insurers typically charge customers higher rates than standard insurance companies. The policy for a high-risk driver may also have additional restrictions.
What is a high-risk driver?
“High risk” doesn’t necessarily equate to being a bad driver. It includes a large subset of drivers, many of whom can’t get coverage from major insurers.
Many companies specialize in high-risk car insurance for nonstandard drivers, but there’s really no standard definition all insurers use. High-risk drivers may include people who:
- Have tickets, at-fault accidents or DUI convictions.
- Have allowed their coverage to lapse.
- Are newly licensed.
- Are elderly.
- Have poor credit.
- Own an exotic or high-powered vehicle.
High-risk auto insurance companies will typically cover drivers who need an SR-22, also known as an FR-44 in some states. Insurers will file the form with your state’s department of motor vehicles if you need one.
Where to find high-risk auto insurance
Although some major insurance companies, such as Geico and Progressive, do insure some high-risk drivers, others like Safe Auto and The General specialize in them. Depending on what makes you high-risk, any of these companies could offer the lowest car insurance rates.
Certain agencies and brokers like Good2Go and Freeway Insurance also provide nonstandard insurance. Brokers charge an additional fee that most states, but not all, require them to disclose. If you use one, ask if there are any additional fees not included in your car insurance quote.
The best high-risk auto insurance companies
If you’ve been pegged as a high-risk driver, shopping around for the best rates is crucial because each insurer prices policies differently. NerdWallet’s star ratings system is used to evaluate both traditional and nonstandard auto insurance companies. Here are ratings for insurers that offer policies to at least some high-risk drivers.
NerdWallet’s auto insurance ratings are determined by our editorial team. The scoring formula takes into account pricing and discounts, the ease of filing a claim, website transparency, financial strength, complaint data from the National Association of Insurance Commissioners and other considerations.
How much does high-risk auto insurance cost?
Although high-risk drivers generally pay more than $1,427 per year, the average national cost for car insurance according to NerdWallet’s rate analysis, there are always exceptions. Auto insurance rates at every risk level vary widely depending on gender, driving history, location and other factors, like the type of coverage you buy.
For instance, “full coverage” auto insurance can cost almost double the amount you’d pay for minimum coverage. Full coverage refers to a combination of different car insurance coverages, including higher liability limits, collision and comprehensive insurance.
While you don’t want to skimp on buying enough insurance, you can change insurance companies if you find a better deal. High-risk drivers, like all drivers, can find the cheapest insurance rates by shopping around for auto insurance quotes.
We can’t predict what your exact car insurance rate will be, but we can provide averages for drivers with high-risk profiles. This includes consumers with bad credit or with an at-fault wreck or DUI on their record.
Car insurance costs for drivers with poor credit
National average car insurance rates for a 25-year-old driver with poor credit are:
- $2,894 per year for full coverage.*
- $1,195 per year for minimum coverage.
National average car insurance rates for a 40-year-old driver with poor credit are:
- $2,506 per year for full coverage.*
- $1,078 per year for minimum coverage.
While using credit history to calculate car insurance rates is illegal in California, Hawaii and Massachusetts, our 2020 car insurance rate analysis found that bad credit can double your insurance costs in other states. That’s why it’s important to shop around — we see drastic differences in price state to state and company to company.
For example, NerdWallet’s analysis found:
- Dairyland charges a 40-year-old driver in Idaho with full coverage and bad credit over 28% more on average than someone with good credit.
- Geico increases the rates for a 40-year-old driver in Florida with full coverage and bad credit by more than 79% on average compared to a driver the same age with the same coverage and good credit.
Drivers receive a wide range of rates, even in the same state. As you’ll see below, a 40-year-old Florida driver with poor credit pays over $2,000 more than a driver with good credit at Progressive. Meanwhile, Direct Auto doesn’t penalize Florida drivers with poor credit at all, which is surprising considering that drivers with poor credit typically pay 75% more for car insurance than people with good credit.
|Insurance company||Drivers with good credit||Drivers with poor credit||Average annual difference in Florida|
Car insurance costs for drivers with an at-fault accident
National average car insurance rates for a 25-year-old driver with an at-fault wreck are:
- $2,451 per year for full coverage.
- $1,008 per year for minimum coverage.
National average car insurance rates for a 40-year-old driver with an at-fault wreck are:
- $2,146 per year for full coverage.
- $910 per year for minimum coverage.
On average, auto insurance rates can cost more than twice as much for drivers who have caused a wreck with $5,000 in damage, according to NerdWallet analysis.
In addition to a base-rate increase for the wreck, you may lose any “good driver” discounts associated with your policy. Whether you have accident forgiveness and the severity of the accident will determine how much your rates increase.
Some companies are more forgiving than others when it comes to accidents. For example, we found these different rates for 40-year-olds with full coverage:
- Safe Auto increases rates after one at-fault accident, around 48% on average in Kentucky.
- Progressive charges New Mexico drivers an additional 74% on average after one at-fault accident.
An accident generally affects car insurance rates for three to five years, so be sure to shop for auto insurance quotes on those anniversaries.
Taking the time to shop around after an accident can help you save hundreds of dollars per year. For example, Infinity charges $1,799 per year on average for 40-year-old drivers with full coverage in California. After an at-fault accident, average rates rise 94.5% to $3,500 a year. Still, 21st Century increases rates even more drastically. California residents with one at-fault accident see an average rise in their insurance of 136% a year under 21st Century.
|Insurance company||Drivers with clean records||Drivers with one at-fault accident||Average annual difference in California|
Car insurance costs for drivers with a DUI
For a 25-year-old driver, national average car insurance rates after a DUI are:
- $2,911 per year for full coverage.
- $1,204 per year for minimum coverage.
For a 40-year-old driver, national average car insurance rates after a DUI are:
- $2,531 per year for full coverage.
- $1,079 per year for minimum coverage.
As always, these rates fluctuate significantly depending on state and company. For example, our rate analysis found the following for 40-year-old drivers with full coverage:
- 21st Century raises rates by 191% a year on average for drivers in California with a recent DUI compared to drivers with a clean record.
- Direct Auto charges an additional 4.8% a year on average for drivers who have a recent DUI in Florida.
Again, shopping around for car insurance is the best way for you to find the cheapest and best insurance company for you. For instance, in Indiana, Geico increases rates after a DUI by over $800 on average. Progressive and Safe Auto both charge drivers with a recent DUI considerably less, raising rates over $245 and $380 a year, respectively.
|Insurance company||Drivers with a clean record||Drivers with a recent DUI||Average annual difference in Indiana|
Evaluating high-risk auto insurance companies
As you compare high-risk car insurance options, look for a company that is financially strong (so you can be confident it’ll be able to pay claims) and that doesn’t have too many complaints.
Here’s what you should evaluate:
Complaints: The National Association of Insurance Commissioners collects data on complaints about insurance companies and calculates a ratio for each type of insurance. The NAIC’s ratios are based on the number of complaints filed against an insurance company with state regulators, adjusted for market share. The national median is 1.00. Very high complaint ratios — higher than 1.7 — are out of the ordinary and often indicate a company has had many unsatisfied customers relative to the value of premiums it has written during the year.
Financial strength: The financial strength of a company tells you how likely it is the insurer can pay a claim. An insurer with any of the A grades is a safe bet, but not all car insurance companies have a financial strength rating. A company could be unrated by A.M. Best for a variety of reasons, including that the company hasn’t requested a rating or requests not to be rated anymore.
Still can’t find a company to insure you?
Even after applying to several nonstandard insurance companies, you may still be denied coverage. As a last resort, you can turn to your state’s high-risk insurance pool through the Automobile Insurance Plan Service Office. To start, find your state in AIPSO’s directory.
How to avoid high-risk car insurance rates
Some factors that make drivers a high risk in the eyes of insurers, such as age, could be outside your control. Others, like owning a fancy car, may not be things you want to change. But in general, here are some tips to get out of the high-risk insurance category (and lower your rates) as soon as possible:
- Take steps to improve your credit. Drivers with poor credit and a clean driving record pay almost as much for car insurance as a driver with a DUI, according to NerdWallet’s 2020 rate analysis.
- Become a safer driver. You can even take a driver safety course and earn discounts from some companies after completion.
- Shop for better insurance rates three years and five years after a traffic violation conviction.
- Don’t let your auto insurance lapse. Drivers with a gap in coverage are labeled high-risk, even if they don’t own a car. Non-owner car insurance can help you avoid being labeled as a high-risk driver.
Ready to shop? NerdWallet’s car insurance comparison tool can help you find rates.
For our “good driver” profile, NerdWallet averaged rates from the largest insurers in the state for 40-year-old men and women in all ZIP codes with 12,000 annual miles driven. The policy includes:
- $100,000 bodily injury liability per person.
- $300,000 bodily injury liability per accident.
- $50,000 property damage liability per accident.
- $100,000 uninsured motorist coverage per person.
- $300,000 uninsured motorist coverage per accident.
- Collision coverage with a $1,000 deductible.
- Comprehensive coverage with a $1,000 deductible.
If required, minimum additional coverages were added and “good driver” discounts were automatically applied. Our “young driver” had all the same characteristics, but average rates were for 25-year-old men and women. We used the same assumptions for all other driver profiles, with the following exceptions:
- For drivers with minimum coverage, we adjusted the numbers above to reflect minimum required coverage by law in the state.
- We changed the credit tier from “good” to “poor” as reported to the insurer to see rates for drivers with poor credit.
- For drivers with one at-fault crash, we added a single at-fault crash costing $10,000 in property damage.
- For drivers with a DUI, we added a single drunken driving violation.
We used a 2016 Toyota Camry LE for all drivers. In all cases, a paperless discount, e-signature discount and electronic funds transfer discount were automatically applied. These are rates provided by Quadrant Information Services. Your own rates will be different.