AUTO INSURANCE ARTICLE
What is the Difference Between Standard and Non-Standard Car Insurance?
By: RoryFWhether you qualify for a standard or non-standard car insurance policy depends on several factors. Insurance companies have guidelines or specific criteria that tell the agent what kind of insured they are looking for. If you do not meet the guidelines set forth by a standard auto insurer, your only choice will be to obtain coverage through the purchase of a non-standard auto policy instead.
Standard Car Insurance
Standard car insurance can be purchased from insurance companies known as direct writers. Companies such as Farmers, State Farm and Allstate are direct writers. This kind of coverage can also be purchased from independent agents who write through standard market companies that are not direct writers. In order to qualify for this type of coverage the guidelines concerning tickets, accidents and DUI/DWI, credit ratings and bankruptcy filings, young drivers, and certain types of vehicles are very strict. These markets will only write coverage for those they deem to be the least risk.
Non-Standard Car Insurance
Non- standard car insurance is provided in most cases by companies that are called surplus lines markets. These markets are willing to write car insurance for people with poor driving records, people with less than favorable credit, young drivers, and high risk vehicles. Most states also have a high-risk auto pool that provides basic coverage for those that even surplus markets will not write.
The main difference between standard and non-standard car insurance is price. Standard car insurance is much cheaper than non-standard car insurance. The company willing to write non-standard car insurance is accepting a great deal more risk than the standard insurer, and in doing so the premiums they are able to charge take the increased risk and exposure in to account.
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