Each infraction such as moving violations, parking tickets, at-fault accidents, or driving under the influence, is assigned a certain point value. When you are found guilty of one of these infractions, the appropriate number of points is added to your driving record. The more points you have, the worse your record. Each insurance company has its own method of evaluating applicants, so the points on your driving record may or may not have a direct impact on the rates you pay for auto insurance.
A point system is simply the assignment of "points" or values to each infraction. Then, the rating system of the insurance company evaluates the "points" instead of each infraction. For example, a company may use this type of system:
Description | Points 1st Occurrence | Points 2nd Occurrence | Points Each Additional Occurrence | At-fault Accident | 2 | 3 | 2 | Driving Under the Influence | 1 | 2 | 3 | No Charge Violation | 0 | 0 | 0 | Major Violation | 4 | 4 | 4 | Minor Violation | 2 | 1 | 1 | Not-at-fault Accident | 0 | 0 | 0 | Speeding | 3 | 2 | 2 |
Comment Followup: Because each insurance company has a different (complex) rating algorithm there is no set dollar amount or rating point comparison that can be given. If you want to find the specifics for your insurance company, their rates are filed with the state's department of insurance. You can request a copy of those rating factors and how they affect the companies' specific rates. It is very complex and not for the faint of heart.
Typically, you can expect the company rating algorithm to try to put an insurance point value on each infraction (regardless of the state driving record point system). Based upon that point value a different rating factor is use to either raise or lower the rate. Again, it is different for every company. Some companies rating algorithms are much more complex and some are simple.
One major violation can increase your rate by 26%. Then, most rating systems gradually lower the impact each year.
|