Do Points on License Impact Car Insurance?

August 11, 2020

Traffic tickets come in varied severity. Minor the moving violation, lesser the impact on your insurance premiums. Moving violations affect auto insurance premiums rather than when your vehicle is parked or not moving. To what extent premiums go up is not exactly predictable and it depends on the insurance company and its policies. Your driving record is an important contributing factor in determining your auto insurance premiums.

Check with DMV first on points accrued

The first thing to do is to check the DMV website of your state if the kind of ticket you received accrues any demerit points. Most states have a point system that stays on your driving record for a period of time usually 3 to 5 years. Severe infractions like DUI, accidents, fleeing from an officer will stay longer, like more than 10 years. Accumulation of such demerit points can lead to cancelation of your driving license which in turn will adversely affect you either in an increase of insurance premium or buying very expensive insurance.

States that do not use a point system simply monitor the driving record. If there are too many infractions within a certain period your license can be suspended for 30 days or can be canceled.

Out of state ticket

If you got an out of state ticket, please know that states have a system to share ticket information, and it will show up on your driving record. Most of the states will assign points and put the ticket on your driving record. You will get a reprieve in  Colorado and Pennsylvania only if its a minor violation. In a few states, the violation is not assessed but it will show up on the driving record. There are also states who assign points and record the violation. Be sure to check with the concerned DMV of the state and or the police department where you got the ticket.  

Serious violations will definitely go on your driving record. Once violations are on your driving record, it will be seen by the insurance companies. Only thing is,

does your insurance company pulls your driving record at every renewal or once a year?

The DMV and insurance use a different point system

While the DMV point system leads to suspension or cancellation of license if too many points are accumulated in a given time period, the insurance company follows its own point system to determine Insurance premiums. The insurance company checks your driving record to ascertain your risk. The Insurance premiums are determined by internal rules. If your driving record is littered with tickets obviously you are a higher risk rather than someone who has a long safe driving history with an occasional ticket. Your premiums will vary accordingly.

Sometimes the fines and points are dependent on county rules rather than that of the state. You can check with the clerk of the court for accurate information.

Order a copy of your driving record from DMV, you can also do this online.  It is a good practice to keep checking your driving record at least once a year. If you got a ticket for a moving violation, it is even more important to check the driving record for any inaccuracy. Maybe you got a minor ticket but points might be for a much more severe issue like speeding.

Taking Driving courses to remove points

Most states have laws according to which if you enroll in a prescribed safe driver course or defensive driver course, and present the certificate before the ticket adjudication points will be waived and it will not affect auto premiums.

Such safe driving courses can be taken for the following if you qualify. Check with DMV or concerned department.

  • To get insurance discounts.
  • To dismiss a traffic ticket. (Finish the course within the time ticket is adjudicated).
  • Court ordered, where it is mandatory to take such a course.
  • Remove Points on record so insurance premiums will not increase.
  • Reinstate a suspended license.

Courses are offered online and offline and run for a duration of 4 hours to 14 hours. It is a good idea to take the course since it gives a good knowledge of rules, road rage, driving tips etc.

Check with your Insurance agent, Insurance policy fine print

It is your insurance company that has the authority to reduce premiums and not the state  DMV(Department of Motor Vehicle) department. So check with your insurance company if you take a safe driver course, or defensive driver course your premiums will go down. Check the fine print in your insurance policy for information as to how moving violations affect premiums. You can find this information in the declaration page of your policy.  You can also call your insurance agent or insurance company and get this information. If you have a lengthy, clean driving record and have one speeding ticket it might not affect your premium. The speed you were over the limit also matters. For ex. If you were speeding say 10 miles over the limit instead of 30 or 40 is also a factor.

Accident Forgiveness Programs

Some insurance companies offer this in addition to the regular policy, wherein, if you qualify an at-fault will be forgiven and it will not result in an increase in premium. Some companies automatically give this if you are a policyholder while others require purchasing it separately. Even in this program, not all at-fault events are treated equally. It might be a good idea to buy such an addition if you are embarking on a road trip and will be in unfamiliar territory. A minor speeding ticket etc. resulting from not knowing the local laws might be spared from an increase in premiums. Be sure the ticket will show on your record. That cannot be prevented. If you have a clean driving record you will easily qualify for such a program. A driving record with accidents, DUI etc. will most certainly not qualify. Check with your insurance company or agent for more details.

Disappearing Deductible Program

Another insurance program worth checking with your insurance agent is the disappearing deductible program. As per this program, for every year of incident-free driving, you will see a certain reduction in your deductible. Different companies offering this have different variants. A great way to monetize a  clean driving history, this program is not very useful if you have many incidents on your driving record since this program costs extra premium to be paid.