Many people don’t know that their history behind the wheel, or driving record, can influence their life insurance. Insurance companies place a lot of weight on what type of driver a policy applicant is. This factor can determine whether or not they grant the policy and how much it will cost.
In this article, we will explain how your driving record can be important in obtaining insurance with good coverage at the best price. Keep reading to find out more.
Your Driving Record and Life Insurance: Article Contents
What Is a Driving Record and Who Keeps Track of It?
Road safety is very important in the United States. That’s why the driving history of every person is carefully monitored and any incidents are recorded in what’s called a “Motor Vehicle Record” (MVR).
This MVR is generated by each state, as state governments are in charge of road safety. Each driver with a driver’s license has an MVR, which includes any situation that might happen: traffic accidents, major violations, minor violations, driving under the influence of drugs or alcohol, etc. Any history of poor driving caught by the authorities will be reflected in your driving record.
In principle, this information will remain in the MVR for a certain period of time, determined by each state. Minor violations, such as running a stop sign, will only remain in your driving record for a short time. In contrast, accidents caused by a violation of traffic rules are considered very serious and will remain in the record for ten or more years.
Each driver can request a copy of their MVR from the state authorities to see what information it contains. In general, you just have to pay a small fee to the Department of Motor Vehicles to get the document. Sometimes, you can receive it instantaneously.
And just like it can be given to a driver, it can also be given to insurance companies when that driver is applying for life insurance. In fact, when applying for a policy, you grant the insurer permission to access your MVR and find out first-hand what your driving history is.
How Does My Driving Record Affect My Life Insurance?
During the underwriting process for both permanent or term life insurance, and even no medical exam life insurance, insurance companies gather together information of all types to assess the risks it would take on in insuring the applicant. They may require medical reports, pharmaceutical reports, or MIB database reports, in which insurers can consult the insurance history of people requesting their services. Another piece of information they typically require is your MVR or driving record.
These details are very useful for the insurer, because they contain information on traffic accidents and violations. Companies pay particular attention to information on:
- DUI or DWI. The most serious traffic violation is driving under the influence. The acronyms DUI or DWI refer to driving under the influence of drugs or alcohol; the definition may vary slightly in each state. Sometimes the term driving under the influence of drugs or alcohol is used, while other times we talk about driving while intoxicated or impaired by these circumstances. In any case, an arrest for driving under the influence can result in a big fine, a lost license and even a prison sentence.
- Reckless driving. Another offense insurers pay close attention to is any major violation that causes an accident. This is called “reckless driving.”
- Multiple moving violations. Multiple moving violations are also often recorded in the MVR. This term refers to an accumulation of violations for not respecting signals, speeding or other offenses.
- Racing. The US authorities are very strict about illegal racing. This is considered a major violation.
- Hit and run. The term “hit and run” means leaving the scene of an accident and failing to provide assistance to the people involved.
- Aggressive behavior. Driving aggressively or violently and insulting, threatening or frightening other drivers are considered major violations in the United States. This is also referred to as “road rage.”
- Homicide. Causing the death of another person by negligent or reckless driving is considered a very serious traffic violation. This is called “vehicular homicide.”
As you can see, insurers care about serious or accumulating offenses. They look at patterns of danger and risk in the way a person drives. They are not concerned with small offenses, such as parking violations, mechanical problems, or other minor issues.
However, if a person’s driving history contains repeated major violations, especially during short periods of time, the company can assume that their risk of having a traffic accident is high. This may be a reason to deny a life insurance policy or, at the very least, charge higher prices for it.
How Can I Improve My Driving Record?
Most insurance companies look at MVR information from the last five years. As such, when applying for life insurance, it’s important that your driving history does not contain any major violations during that period.
What’s more, many companies also pay attention to moving violations during the last two years. These are offenses committed while the car is moving and on the road: not respecting signals, speeding, not wearing your seatbelt, etc.
If you have a problematic driving history, there are various ways you can improve it:
- Take traffic safety classes. If you have a history of several accidents or major violations, you can attend traffic safety classes. These classes will retrain you and the insurance company will see you’re taking steps to become a more responsible driver.
- Appeal fines. One way of eliminating fines from your record is to appeal them. Fines can often be dismissed if you dispute them in court, and any record of them in your history will be eliminated.
- Pay for damage without reporting it. Traffic accidents often cause minor damage. If you can pay for this damage directly, you can avoid reporting this to the authorities and thus having the accident be recorded on your MVR.
- Wait. The simplest way to clear your driving history is to wait. Minor violations will be deleted after a few years. But keep in mind that major violations, especially driving under the influence of drugs or alcohol, can remain on your record for over ten years.
As such, your driving history can seriously affect your ability to get life insurance–so much so that many companies directly reject people who have very serious violations on their record.
However, there are also companies that are less strict and pay less attention to these incidents. Make sure you are well informed and consult specialized insurance agents: they know which products are most appropriate when getting life insurance with a bad driving history. Lastly, you can always turn to life insurance for the uninsurable.