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What Is A Clean Driving Record And How Does It Affect Car Insurance Rates?

Everybody wants to avoid accidents, and everybody wants the roads to be safer. But with over 6 million passenger car accidents (along with almost 6 million commercial vehicle accidents) every year, the roads are far from being safe. The chances of you getting in a car accident are so high that it is almost inevitable.

Every driver is almost certainly going to be in a car accident, either mild or severe. This certainty is the reason why it is mandatory in almost every state for you to carry liability coverage. Just in case you drove into someone else’s car, you are liable to pay for the damages and medical treatments. So liability coverage assures the government that you would be able to pay for the medical treatments and repairs. 

The only problem is liability coverage isn’t the only auto insurance policy you need to get. There are other optional auto insurance policies such as collision coverage, comprehensive coverage, personal injury protection plan, etc that are almost as important as liability coverage. And these policies are expensive as well. 

But there’s a way you can at least pay less than what others are paying for the same policies. This is done by maintaining a clean driving record. A clean driving record is one of the most impactful factors in determining the cost of your auto insurance. Let’s look at what a clean driving record is and how it affects your car insurance rates. 

What Is A Clean Driving Record

Whenever you are on the roads, every little traffic violation is being recorded. From speeding tickets, and running through red lights, to DUI charges and accidents, everything is carefully recorded in your driving record.

This driving record is used by the DMV, auto insurance companies, etc to analyze your driving pattern and the probability of you getting in another accident. You can access your driving record and see how many violations you have under your name.

Look for your CLUE report that has all the details about your driving for the past 7 years or so. Auto insurance companies access your CLUE report to decide the price of auto insurance policies. 

A clean driving record, as the name suggests, is not having any traffic violations on your driving record. It shows that you are a law-abiding citizen and a responsible driver as well. Insurance companies love that and they reward you for it as well. Here’s how.

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How Does Driving Record Affect Auto Insurance Rates? 

Auto insurance companies are risk-management companies. They make money not by selling as many policies as they can, but by managing risks properly so that the number of policyholders who are paying insurance premiums is as high as possible, while the number of policyholders making an insurance claim is as low as possible. Switch these two and the insurance company would go bankrupt.

When a person buys an auto insurance policy, the company considers multiple factors to calculate the risks. They look at the person’s driving record, past insurance claims, age, gender, location, credit score, etc and determine how likely the person is to be in a car accident, make an insurance claim, and/or miss out on insurance premium payment. 

People who are more likely to be in a car accident and make an insurance claim are charged more for the same policy. This is to offset the risk of selling the person the risk. The price hike varies from one company to another. Some auto insurance companies might charge you a lot for something as simple as a speeding ticket, while some companies can charge you almost 50% more. 

Serious violations such as accidents, DUI charges, etc will increase your auto insurance rates by a lot, sometimes even quadrupling it! So do not drive under the influence and drive carefully to save yourself from spending a fortune on getting auto insurance. 

Auto Insurance Policies That Are Affected By Your Driving Record

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Liability coverage: Liability coverage is directly affected by your driving record. If you are more likely to get in a car accident, the insurance company will have to pay for the damages. Liability coverage is already very expensive and it is almost impossible to find the cheapest auto insurance policies with great coverage. So drive carefully and save money on auto insurance. 

Collision Coverage: Collision coverage is just like liability coverage, but for your car. Collision coverage covers the cost of repairs to your car irrespective of whose fault the accident was. So you can get in a car accident and even if it was the other driver’s fault, you can claim your collision insurance. 

Not just accidents with other cars, collision insurance can be claimed even if the car collides with animals, trees, poles, walls, etc. Some collision coverage also covers damages due to bad roads. 

As with liability coverage, collision coverage is also directly affected by your driving record. A bad driving record will result in higher rates of collision coverage.

While the rates can be high due to a bad driving record, there are some ways you can reduce the cost. Here’s how you can bring down the cost of auto insurance rates for people who have a bad driving record. 

Take Defensive Driving Course: Many auto insurance companies offer a price cut if the applicant has taken a defensive driving course (or something similar, often recommended by the insurance company). So take it and it will help you save some money on the already expensive policies. 

Along with this, you can look for discounts to help you save some more money. But as it goes, prevention is better than cure. So keep driving safely, avoid breaking the traffic rules and get an auto insurance quote that does not make your jaw drop.