The Proper calculation at the right price can lead to a profitable conduct while improper one brings potential loss of money. Premium must outweigh the total amount of possible payout to maintain a healthy business. Accumulation of premium from thousands of customers can cover the needs for compensation in case someone gets into the road accident.
The process of risk calculation involves meticulous research to figure out applicant’s information which may include:
– Crime rate at applicant’s neighborhood and office
– Safety devices in the car
– Previous involvement in road incidents
– Credit score
Some personal information differentiates the premiums between one customer and another, even if they drive the same type of car and buy an equal amount of coverage. Many companies also use credit score to determine approval and price. Every piece of data plays its role to help insurer predict the chances of policyholders’ involvement in accidents for as long as the policy is valid.
For insurers, there are three categories of drivers: preferable, low risk, and high risk. The first category refers to drivers who do not have any traffic ticket and have never had any involvement in a road incident. The second one refers to policyholders with minimum possibility of accident or drivers whose risks are within acceptable threshold. The last category belongs to the non-standard market where the application process is easy, but the price for premium is higher than normal.
Reasons for High Risk
There are many reasons why an insurer considers someone high risk. The most obvious ones are a poor record, cancellation from the previous carrier due to late payments, and major traffic violations such as DUI and speeding. However, some less obvious or arguable reasons also exist, for examples:
· Young drivers
· First-time insurance applicant
· Senior citizens
· Home address has high crime rate
· Past involvement in multiple road accidents
· Records of at-fault incidents
· Bad credit score
One of the providers in the nonstandard market is goodtogo insurance. It is a company that provides state minimum coverage for high-risk drivers so they can get back on the road with valid proof of insurance. The reason for easy approval is that the carrier does not ask for many personal information details such as traffic ticket records and credit score. For good reasons, goodtogo insurance requires only basic data to underwrite the policy for every applicant.
State Minimum Coverage
Every state has different coverage requirements. Some require liability, while others also make PIP (Personal Injury Protection) compulsory. Limits for coverage must comply with the state’s insurance regulation as well. At goodtogo insurance, all agents underwrite all policies by the policyholder’s state. At the moment, good to go auto insurance has the license to sell and underwrite policies in Alabama, Arizona, Connecticut, Delaware, District of Columbia, Georgia, Illinois, Indiana, Mississippi, Missouri, New Jersey, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee, Virginia, Washington.
In case the applicant lives in a state in which goodtogo insurance does not have the license to sell policies, the company can refer consumers to other carriers. As part of American Independent Companies family, goodtogo insurance works in affiliations with subsidiaries all over the country to cover all states. Some affiliates are:
· American Independent Insurance Company
· Omni Indemnity Insurance
· Omni Insurance Company
· Personal Service Insurance Company
Payment Options: High-risk drivers must pay more for premiums, but the company offers several payment options to help policyholders manage their expense:
· Economy payment for a period (a year) of policy comes with installment due every month.
· another installment option, but the payment is due every four months.
· Annual and one-time upfront payment that comes with 31% discount.
Optional Coverage: For additional protection, good to go auto insurance also offers optional coverage apart from the minimum state requirements. Policyholders can ask for optional coverage for complete protection.
Collision: state minimum liability requirement assigns all payout for the not-at-fault party. It means an at-fault policyholder does not receive compensation for car damages. For the company to cover repair and replacements, the customer can purchase Collision coverage. The compensation applies only when damages to a car are results of auto accidents.
Comprehensive: an all-around coverage that covers damages to cars from various risks except road accidents. Damages from fire, theft, vandalism, animals, and flood are under the protection of this coverage.
There is no obligation to purchase those additional protections, but an agent can recommend them to customers to get better protection from possible financial losses. High-risk drivers do not have the luxury to get the most affordable options, but they can revoke high-risk status or at least reduce the premium thanks to discounts from:
– Enrollment in Defensive Driving Course- Clean record/claim free on renewal
– Enrollment in Driver’s Education Course
– Safety devices in car
– Non-owner policy
Good to go auto insurance has no affiliation with goodtogoinsurance, which provides only travel insurance policies for customers. They are different entities, and each offers a different type of insurance.
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