What Is Non-Standard Auto Insurance?

What Is Non-Standard Auto Insurance?

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Non-standard auto insurance refers to the tier of car insurance reserved for risky drivers. In most cases, it is the same as standard coverage, except that the premiums are higher. If the insurance company determines you are extraordinarily risky due to your driving record or your age, it may charge you non-standard rates.

Non-standard insurance may also refer to coverage for drivers whose needs don't fit within regular insurance categories, such as car insurance for someone who doesn't own a car. Major carriers sometimes sell non-standard auto insurance alongside their standard coverage or through a subsidiary non-standard insurance company. Some independent companies specialize in non-standard or high-risk auto insurance only.

How Does Non-Standard Auto Insurance Work?

Non-standard auto insurance refers to high-risk coverage, the most expensive tier. It is reserved for drivers who are too risky for insurance companies to cover at their standard rates. Insurers typically break down their coverage into three risk tiers: preferred, standard and non-standard. Preferred customers pay the least for their insurance premiums, while those in the non-standard tier pay the highest rates—though their coverage may be the same. These categorizations help carriers to appropriately calculate their risk exposure and remain solvent.

For example, if you've been convicted of a DUI or have filed multiple accident claims within the past few years, you pose a higher statistical risk to your insurer. As such, you'll fall under the non-standard tier of drivers, and your rates will be much higher than average.

If you're deemed too risky, the insurance company might drop your policy, and you'd have to purchase coverage from an insurance company that specializes in non-standard auto insurance to keep driving. You may also be categorized as a high-risk driver if you're younger than 25, older than 75, you lack driving experience or have a poor credit history.

You can purchase non-standard or high-risk auto insurance the same way you would any other policy, although your state may impose additional requirements depending on the reason for your non-standard qualification. For example, if you are a teen driver and you purchase a policy from GEICO, the only difference you'll see between your policy and that of a middle-aged driver's is in the premiums. The actual process of buying the insurance is the same.

However, your process will differ if your state requires you to file an SR-22 before re-registering your vehicle, as it might if you were convicted of a DUI. In that case, you'll need your insurance company to file the form on your behalf, to prove to your state that you've obtained adequate auto insurance. Such a driver would also see a significant increase in their premiums. At the time of filing, you'll also have to pay a small fee.

How Much does Non-Standard Auto Insurance Cost?

The cost of non-standard auto insurance depends on both the average premiums in your state and the reason you're required to get non-standard coverage. A speeding violation may cause your rates to go up but not as much as a DUI.

Surprisingly, we found that in most states, age had the largest influence on rates. Teenage drivers tend to pay higher rates than drivers guilty of a DUI-related accident. The table below shows that the additional cost of non-standard insurance varies significantly by state as well as by the reason the driver was determined to be higher risk.

StateAnnual Premium (Standard)Speeding ViolationDUI + AccidentYoung Driver
California$1,830$3,060$7,794$6,177
Florida$1,576$2,424$3,384$4,278
Illinois$1,320$2,784$2,004$6,279
New Jersey$2,416$4,452$6,576$9,048
New York$1,812$2,544$5,532$6,216
Pennsylvania$1,819$2,028$3,436$10,208
Texas$1,230$1,242$2,298$4,068

Reasons You May Fall Into the Non-Standard Tier for Auto Insurance

Non-standard insurance is a broad term, and there are a variety of reasons you may have to get it. Generally, any factor that significantly raises your auto insurance rates indicates a non-standard tier of insurance.

  • You are a high-risk driver. If you have had multiple traffic violations and accidents that have resulted in an insurance claim, you will likely be labeled a high-risk driver.
  • You are required to carry an SR-22. Your state may require you to carry an SR-22 if you've been convicted of a DUI or other form of reckless driving. As long as the form is required, you'll have to pay non-standard insurance rates to legally drive.
  • Your car has a salvage title. Some major insurers offer liability coverage for rebuilt vehicles, but not collision or comprehensive coverage. If you can't obtain liability coverage from a major company, you may need to turn to a non-standard insurance carrier.

Another type of coverage that is considered non-standard is if you carry non-owner car insurance. Non-owner car insurance is coverage for people who don't own a car but frequently drive. Unlike high-risk drivers, non-owners can usually find cheap liability insurance through major insurance companies.

Who Sells Non-Standard Auto Insurance?

Many insurance companies offer non-standard auto insurance as a separate tier of coverage. Additionally, some large insurers own subsidiary companies that offer non-standard coverage to the high-risk section of the market.

If you require such coverage, specialist companies may provide you with better rates for non-standard insurance than larger carriers. Be sure to compare quotes from at least three different insurance companies to ensure you're getting a good rate.

Insurance companies that sell non-standard auto insurance

Finally, if you cannot obtain car insurance from any high-risk auto insurance company, consider your state's assigned-risk pool, which provides insurance to high-risk drivers who cannot otherwise obtain coverage. This should only be used as a last resort, however, as most state's assigned-risk programs tend to be more expensive than coverage offered by non-standard insurance companies.

Mark is a Senior Research Analyst for ValuePenguin focusing on the insurance industry, primarily auto insurance. He previously worked in financial risk management at State Street Corporation.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.