In most American states, you are essentially breaking the law if you drive without minimum liability insurance coverage. Drivers who continue to operate vehicles without insurance are not actually saving money. As a matter of fact, this is costlier when you take into account the possibility of accidents or being apprehended for a violation, such as driving while intoxicated. Paying out of pocket for damages you may incur is not exactly cheap.
The requirements for driving are similar in every state, but there are some states that have special demands for some circumstances. For example, having SR22 insurance in TN is how law enforcement and the Department of Motor Vehicles (DMV) verify that you have auto insurance. Your insurance company will prepare this document and file it with the DMV. This is common when you want to have your driver’s license reinstated after a violation like driving under the influence (DUI) or reckless driving.
How Your Insurance Premium is Determined
Not all drivers are the same, so it is only natural that insurance companies will charge different premiums per client. The way they determine how much you should pay, however, is somewhat similar. Here are some factors that may affect your insurance premiums:
1. Driving records. The more violations or accidents you have, the higher the premium you are likely to pay. The insurance provider considers you high-risk.
2. How much you drive. A person who drives only short distances on weekends and takes the bus or a cab every workday will pay less than someone who drives to work every day, because being on the road more means a higher likelihood of an accident or violation.
3. Car type. If you drive an Aston Martin, you’ll pay a higher premium than if you drive a Civic. First, those who like performance cars are typically high-risk drivers; second, maintaining and repairing an Aston is much, much more expensive than doing the same for a Honda.
Other factors include your age, where you live, and even gender and marital status. Insurance providers in other states may also cite special circumstances. The common denominator is you need insurance to operate a vehicle, and not just because the government demands it.