How do points affect my insurance rates?
The motor vehicles departments in most states use a “point system”. This type of system is used to track your driving record.
Each type of infarction (violations, parking tickets, speeding tickets, driving under the influence, fault accidents, etc…) is assigned a certain point value. The more points you have, the worse your record is.
An auto insurance company has the right to review your or anyone else’s driving record of anyone who applies for an auto insurance policy from that specific company.
The purpose of the point system is for:
Determining whether you meet the insurer’s standards of insurability (whether you will need insurance or not)
Evaluating your potential of risk (how much your insurance will cost you)
Those two factors are important to insurance companies. This way, they have a completely logical and reasonable way of determining your rates.
Keep in mind that each insurance company has its own method of evaluating their applicants, so the points on your driving record might not be the most crucial factor for your insurance company.
Once you have issued a policy, your insurance agent will probably review your driving record at any time and evaluate the conclusions he finds necessary.
Few insurers have the appropriate resources or the inclination to run daily checks on your driving records. The frequency of these checks won’t be high.
There are some times when you can be sure that an insurance company will be checking your driving record. These times include:
- When you request a change to your policy
- When you add a vehicle to your policy
- When your policy is up for renewal
- When you apply for coverage
These conclusions are reasonable factors for evaluation of monthly payments and premiums. Thus, it is perfectly natural for your insurance company to check with your driving record in a timely fashion.