Nonstandard auto insurance: Your ultimate guide

Reasons you may need nonstandard auto insurance

Your driving record, history of insurance coverage, age, and other factors are taken into consideration when you buy car insurance. Some of the reasons an auto insurance company might only offer you nonstandard car insurance include:

Poor driving record

You could be placed in the nonstandard category if you have a history of violations. Overall, this designation is typically reserved for drivers that have been involved in serious accidents or have committed violations in the past, such as:

• Reckless driving
• Driving under the influence (DUI)
• Driving a car with no insurance
• Driving without a license (or with a suspended or revoked license)
• Committing any other traffic violations resulting in citations

When a driver has offenses of this nature, they present a higher risk for insurance companies. This risk increases exponentially the more violations a driver has on their record. In other words, insurance companies consider a driver who's ever been designated an uninsured motorist, who has several DUI offenses, or who's been in multiple accidents more likely to commit the same offense again in the future.

Some states require drivers with multiple offenses to get an SR-22 certificate (or an FR-44 in Virginia and Florida). An SR-22 isn't a policy in itself, but rather a statement from your insurance company proving you carry insurance on your vehicle. Some auto insurance companies charge higher rates for policyholders who must obtain an SR-22 form. 

Inconsistent insurance coverage

Auto insurance companies are happy to assist when you reach out to them for coverage. But one of the first in a line of questions they'll ask is: Do you currently have insurance?

A lapse in coverage won't automatically put you in the nonstandard auto insurance category, but too many lapses or stretches of time with no auto insurance can make you appear risky to a potential insurer.

Age

Your age plays a role in your car insurance classification, too. Young or young at heart—how old you are can factor significantly into whether you'll be classified as nonstandard.

• Younger drivers: Young drivers, especially those who've just recently gotten their driver's license, are statistically more prone to accidents because they lack driving experience.
• Older drivers: While more mature individuals have years—sometimes decades—of driving experience, they may be classified as nonstandard for other reasons, like being more likely to have slower reaction times, poor vision, diminished physical abilities, or other health problems.

Foreign license

Like a coverage lapse, a foreign driver's license doesn't automatically place someone in the nonstandard auto insurance category—but other factors are examined, such as those mentioned above, and whether the driver has a driving record in the U.S. If the insurer can’t access a driving record to gauge potential risk, the person will most likely be considered nonstandard.

Bad credit

Having a low credit score doesn't disqualify you from getting a car insurance policy, but it may affect your policy premiums. Your credit score is typically used by other entities, such as banks or other lenders, to determine your creditworthiness when applying for a loan. However, an insurance company may look at your credit report to gauge your financial responsibility—policy applicants with poor credit may be classified as nonstandard.

You don't own a car

If you don't own a car but you have to drive a vehicle to get to work or have other responsibilities that require you to drive, you’re not necessarily considered a high-risk driver. However, your auto insurance provider will still classify you as a nonstandard driver and offer you non-owner auto insurance, protecting you in the event of an accident while driving someone else's vehicle.

Your policy also acts as supplemental insurance for the car owner to help pay for any damages not covered by their primary auto insurance policy.