If you're like most people, you may not be familiar with high-risk auto insurance coverage. In some cases, you may have only learned about it after receiving a notification from your state motor vehicle department. Drivers typically receive these notifications after an event that places them in a high-risk category, preventing them from using standard coverage for their vehicles.
When you fall into this category, you must prove to your state government that you hold a minimum amount of liability coverage. You may hear this referred to as "SR-22 insurance" because your insurer provides an SR-22 form to the state to meet this requirement.
What Makes SR-22 Policies Special?
It's essential to understand that requiring an SR-22 doesn't mean that you'll need a particular insurance policy. Instead, insurers classify drivers who must file this form into a high-risk category. Some insurers may be unwilling to offer you a policy if you need to file an SR-22, while other insurers specialize in insuring high-risk drivers.
In most states, filing an SR-22 doesn't mean that you need any additional coverage. Instead, this form certifies that you meet the minimum requirements mandated in your state. However, some states may have different requirements for high-risk drivers. These states typically have separate forms you'll need to file certifying that you meet the higher coverage requirement.
Note that filing an SR-22 does carry one additional caveat: your insurance company will immediately inform your state if you drop your coverage. Penalties can vary for canceling your insurance, but they can be harsh and may include license suspension.
How Should You Choose a High-Risk Insurer?
Filing an SR-22 nearly always puts you into an insurance company's highest-risk category, which means you can expect to pay more for insurance. If your current insurer does not cover high-risk drivers, then you'll need to find a new one that does. While your options might be somewhat more limited, you don't necessarily need to resign yourself to extreme premiums.
When selecting a high-risk insurer, you should follow the same best practices as you would when buying any other insurance policy. Always start by calling multiple companies to request quotes so that you can find the insurer with the best possible offers. You will also be free to adjust your coverage levels so long as you meet the state minimum for liability coverage.
Being told that you must file an SR-22 can be intimidating, but it doesn't have to mean a lifetime of high insurance premiums. Once you purchase a policy, be sure to maintain it for the whole lifetime of your SR-22. By keeping up a perfect insurance record, you'll be more likely to enjoy reduced premiums once your SR-22 requirement comes to an end.
For more information on sr22 insurance, contact your local business in Germantown, TN.