Car insurance premiums are already significant in many states. But, if you are convicted of a DUI (driving under the influence) charge, your premiums can skyrocket. In addition, there are other impacts that can turn your car insurance policy from a mere nuisance into a major problem. This article will describe the effects that a DUI conviction can have on your car insurance coverage.

Increased Car Insurance Premiums

It’s a foregone conclusion that your premiums will increase once you have been convicted of a DUI. When a driver has been convicted of driving under the influence of drugs or alcohol, the car insurance company that carries the policy on that person will consider him a high-risk driver. From the car insurance company’s perspective, a person who drives under the influence exposes the company to a significant level of financial risk. This increased level of risk is due to the potential liability from property damage and human casualties that a DUI implies may happen in the future.

The higher perceived financial exposure for the car insurance carrier is passed along to the driver who has been convicted of the DUI in the form of higher insurance premiums. Though the amount your premiums will increase is unknown, it is likely they could double. Further, if you have enjoyed a “preferred driver” status with low premiums, a DUI conviction could nearly triple your premiums in some states.

Termination Of Your Insurance Policy

If you are convicted of a DUI, your car insurance carrier may cancel your policy. As mentioned, a DUI implies significantly greater financial exposure for a car insurance company to underwrite your policy. If the carrier considers you too great a risk as a driver for them to continue carrying your policy, they may simply cancel it mid-term. This can often happen when a driver has received the conviction after having a clean driving history with “preferred driver” status. Sometimes, the insurance company will allow your contract to expire at the end of its term and refuse to renew your policy.

Filing Of An SR-22 Proof of Insurance Certificate

A conviction of driving under the influence in most states requires that the driver file an SR-22 Proof of Insurance Certificate. This is usually filed through the insurance company. The impact of filing an SR-22 is that it alerts car insurance companies of a driver’s DUI conviction. As a result, the driver is “red-flagged.” Some carriers do not offer policies for those who have filed an SR-22. So, if you are convicted of a DUI and your insurance carrier cancels your policy, your “red flag” status will likely have a dramatic impact on the premiums you will pay at a new insurance company.

The effects of a DUI on your insurance can be hard to manage. At the very least, you will almost certainly have to pay much higher premiums on your existing car insurance policy. However, if your insurance carrier cancels or refuses to renew your policy, you will be forced to find another carrier who is willing to underwrite a policy given your “red flag” status. The key is to plan ahead once you have been arrested for a DUI. Then, consult an expert regarding how best to approach your car insurance problems before a DUI conviction follows.

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