What many people don’t realize is there are actually insurance companies that are in business solely to insure customers with bad insurance scores and loss history. These companies are known behind the scenes as “sub-standard” carriers.
So why does this matter to you?
You don’t want to become “sub-standard” business folks. The only way to avoid this is by paying your insurance premiums on time, and keeping your loss history as clean as possible.
Sub-standard carriers generally charge much more than a regular company because they are insuring thousands upon thousands of folks who have poor driving records and/or credit. Their loss ratio’s are generally much higher than normal companies and therefore they must bring in more premium to offset their higher than normal claims payouts.
Being insured with a sub-standard company can also impact your insurance score. This is because insurance companies use your “prior carrier” as a variable in your rate. If you are currently with a sub-standard company and trying to change to a “preferred” carrier, they are going to see which company you are with, and it could impact your rates.
Bottom line is, be safe, and try to keep your accidents and claims to a minimum. Sometimes this is not within your control, but most of the time it is.