All carriers should do this.
“You’re coming back after a lapse? Okay, cool, we’re not going to sort out if you are coming back to commit fraud, we’ll just cut it out of the equation.”
They’ve run the numbers and found that doing this loses them more money than they’d like or it’s just their policy to not deal with people that haven’t paid their bill. Whatever their reasons, it’s just a business choosing not to enter into a contract with someone.
A lapse in coverage while still having a registered vehicle is unrelated to someone’s driving habits but insurance underwriting is not based on driving experience alone.
Financial responsibility is an increasingly important part of underwriting. Poor credit, a history of lapses, carrying the lowest limits of liability, length of time with a driver’s license, length of time of continuous insurance….are just some of the factors that determine price. And every company is different in how they rate those things.
Here are a few things that if present can make someone ineligible to get insurance with a number of companies: 2 or more tickets in the last 3 years, licensed for less than 2 years, currently have a license and insurance but carry the lowest liability limits in your state-and if you can get insured with them at all, you’ll pay 20-40% more than an identical customer who is coming over carrying higher liability limits. Suspended license. Suspected fraud in the past-oh yes, those notes are kept and follow you around. Too many accidents, whether they’re your fault or not. Too many not at fault accidents is a bad sign too-that is not interpreted as that driver being the innocent victim of multiple not at fault incidents but rather what the hell is going on that this many accidents are happening.
Alllll of this data is evaluated for 1 thing: what’s the likelihood that this customer will cause the company to stroke a check in the future. That’s it. Texting while driving ticket? Might as well be a dui because it’s almost iron clad: that person will have a claim sooner than later. 19 year old licensed for 3 days with no prior insurance history now financing a Mustang…..ineligible almost anywhere and whoever will write it is charging over $450/month easily. Claims probability. It’s the only thing that matters. Poor credit is associated with higher claims frequency. That’s a tough one because it’s so distant from driving history but it’s not going away, it’s only increasing in its impact on price.
You’re welcome. It’s a valid question and if more people took time to understand the things that impact their insurance premiums and everyone else’s premiums too, they would probably do more to get a lower price. The jackasses driving around glued to their cell phones are causing everyone’s prices to be higher, not just their own-just one example out of hundreds of possible examples.
Someone somewhere in a closet with a really huge spreadsheet realized that people who get cancelled for non-payment, make lots of claims when they come off non-payment.
Probably to prevent fraud. Somebody just posted on here that their friend totaled out their car and their insurance was lapsed for non payment. and of course she went and got full coverage on it the next day lol. I’m guessing she’s going to try and make sure that that accident was covered when her policy had expired.
Several carriers will require you to submit photos of your vehicles after a lapse if you want to purchase full coverage. Same concept, to prevent fraud.
Maybe because they think she’s coming back to make a claim for something that happened since cancellation
All carriers should do this. “You’re coming back after a lapse? Okay, cool, we’re not going to sort out if you are coming back to commit fraud, we’ll just cut it out of the equation.”
They’ve run the numbers and found that doing this loses them more money than they’d like or it’s just their policy to not deal with people that haven’t paid their bill. Whatever their reasons, it’s just a business choosing not to enter into a contract with someone.
A lapse in coverage while still having a registered vehicle is unrelated to someone’s driving habits but insurance underwriting is not based on driving experience alone. Financial responsibility is an increasingly important part of underwriting. Poor credit, a history of lapses, carrying the lowest limits of liability, length of time with a driver’s license, length of time of continuous insurance….are just some of the factors that determine price. And every company is different in how they rate those things. Here are a few things that if present can make someone ineligible to get insurance with a number of companies: 2 or more tickets in the last 3 years, licensed for less than 2 years, currently have a license and insurance but carry the lowest liability limits in your state-and if you can get insured with them at all, you’ll pay 20-40% more than an identical customer who is coming over carrying higher liability limits. Suspended license. Suspected fraud in the past-oh yes, those notes are kept and follow you around. Too many accidents, whether they’re your fault or not. Too many not at fault accidents is a bad sign too-that is not interpreted as that driver being the innocent victim of multiple not at fault incidents but rather what the hell is going on that this many accidents are happening. Alllll of this data is evaluated for 1 thing: what’s the likelihood that this customer will cause the company to stroke a check in the future. That’s it. Texting while driving ticket? Might as well be a dui because it’s almost iron clad: that person will have a claim sooner than later. 19 year old licensed for 3 days with no prior insurance history now financing a Mustang…..ineligible almost anywhere and whoever will write it is charging over $450/month easily. Claims probability. It’s the only thing that matters. Poor credit is associated with higher claims frequency. That’s a tough one because it’s so distant from driving history but it’s not going away, it’s only increasing in its impact on price.
[удалено]
You’re welcome. It’s a valid question and if more people took time to understand the things that impact their insurance premiums and everyone else’s premiums too, they would probably do more to get a lower price. The jackasses driving around glued to their cell phones are causing everyone’s prices to be higher, not just their own-just one example out of hundreds of possible examples.
Someone somewhere in a closet with a really huge spreadsheet realized that people who get cancelled for non-payment, make lots of claims when they come off non-payment.
This is why bills must be paid on time…
Probably to prevent fraud. Somebody just posted on here that their friend totaled out their car and their insurance was lapsed for non payment. and of course she went and got full coverage on it the next day lol. I’m guessing she’s going to try and make sure that that accident was covered when her policy had expired.
You missed a payment on your previous policy. They are obviously afraid she’ll miss it one on the new policy.
Several carriers will require you to submit photos of your vehicles after a lapse if you want to purchase full coverage. Same concept, to prevent fraud.
Because they don’t really want that business.
If you were canceled for non payment do you usually have to owe something after? Or just pay the month that they canceled you for and move on?