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How Two Different Points Systems Affect Your Auto Insurance Rate

Close-up to the hands of a traffic officer as he writes a ticket for a driver to illustrate how two different points systems affect your auto-insurance rate.

As you probably already know, there are several factors that help determine your auto insurance rate, such as age, gender, vehicle type and where you live. But perhaps the biggest factor that affects your rate is the points that you accumulate on your state driving record.

Each state’s Department of Motor Vehicles has its own points system in which they assign points for accidents and violations. Every driver accumulates points for these incidents. Typically, the more serious the violation, the higher the point amount. The purpose of the points system is to keep track of and identify risky drivers. When a consumer is shopping for a price quote, or renewing a policy, an insurance company will pull up the individual’s driving record to help determine the insurance premium. And not surprisingly, the more points you have, the higher the premium.

Whether you’re a good driver or a not-so-good driver, everyone is at risk for accidents and traffic violations. The good thing is that there are things you can do to cut back on some of the points you may have accumulated. For example, you may be eligible to take a defensive driving course to eliminate the points for a moving violation, such as speeding. Also, keep in mind that most states will take off points after a certain amount of years. For this reason, it’s important that you keep track of your driving record. Because errors have been known to happen at DMV, you’ll want to ensure that it reflects the most accurate and up-to-date information. For example, if there’s a violation on your record that should have already been removed, it could potentially cost you hundreds of dollars on your auto insurance rate.

Generally, if an incident occurs that results in points on your record, it probably won’t affect your auto insurance rate immediately. Instead, it will affect you when it’s time to renew your current policy, or if you’re shopping for a new one, since the insurance company will check your most current driving record.

But here’s the kicker: In addition to your state’s point system, every auto insurance company has its very own point system to evaluate a driver’s risk factors. There is no standard point value system for insurance companies, as they have unique methods to determine how much to increase or decrease your premium.

Keep in mind that you can also rack up auto insurance points – not driving record points – for other things besides accidents and traffic violations. These can include: numerous insurance claims, unsafe vehicle citations, bad credit score, driving long distances, or even lapses in car insurance. Although most insurance companies are not required to disclose their point system, many will gladly share it with you.

When it comes to getting the best possible insurance rate, the single most important thing you can do is to be a good driver and maintain your record as spotless as you can. However, if you feel that you’re getting unfair treatment by an insurance company for something in your record, you can file a complaint with your state’s Department of Insurance.

Freeway Insurance can help you even if you have multiple traffic violations. Call (800) 777-5620 to speak with an agent and get a free car insurance quote. Freeway works will all drivers.

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