If you get pulled over by the police, one of the first things you wonder is how much is this going to cost me? That’s an entirely valid question, because speeding tickets have two components: the cost of the citation, and the increase in your insurance that’s likely to follow.
Why speeding tickets affect your insurance rates
Whether it’s auto insurance, life insurance, homeowner’s insurance, or business insurance, insurance companies base the premiums they charge largely on the degree of risk that they take on in issuing a policy.
Risk is the assessment – based on previous behavior – that the company assigns to the likelihood that it will pay a claim on your policy at some point. The higher the risk, the higher your premium will be.
When it comes to car insurance, risk is largely determined by your driving history, particularly within the past few years. Speeding is the most common of all traffic citations. It’s also one that’s considered to be a strong indicator of at-fault accidents. That increases the likelihood that the insurance company will need to pay a claim.
In order to price that higher risk into the policy, you’ll be charged a higher premium to compensate for that expected risk. The company will naturally check your driving history at the time you purchase the new policy. But they will also pull your driving record periodically after that. If any traffic violations turn up on your record, your insurance premium will likely go up.
If you accumulate too many violations, the company might even drop your policy.
Changing insurance companies can help
Each insurance company has a different view of the impact of a traffic ticket on your insurance premium. You might find that you can get a lower premium by going with a different company. Some insurance companies might not raise your premium for a single violation and others may increase it a little bit. Still, others might hit you with an insurance rate increase that screams go away!
Here’s a list of the best auto insurance companies operating in your area.
How far over the speed limit affects your insurance rates even more
Speeding tickets aren’t an either/or situation. It’s often a matter of degree—how far over the limit you were driving. Each insurance company has its own way of recognizing speeding violations.
Some insurance companies won’t increase your premium for a first offense. Others won’t increase your car insurance rate unless you were clocked at more than 15 mph over the posted speed limit.
State law is also a factor. Most states work on a point system, where you’ll be assigned one or more points per violation on your driving record.
Insurance.com provides a Traffic Ticket Calculator tool that will enable you to estimate the insurance increase for a single violation. Testing the tool, I found that a speeding violation of between 15 and 29 mph over the speed limit will result in a premium increase of 12% as a nationwide average. That’s for a driver in the 25-34 year old age range. It could be more or less for other age brackets.
It also varies by state. For example, the same violation will result in a 7% increase if you live in Georgia or New Jersey, 8% in California, and 12% in New Hampshire.
Multiple violations matter even more
If a single speeding ticket causes your insurance to increase, two or more will have an even greater impact. You may even find that an insurance company that’s fairly lenient on a first violation, will be less so on a second or third violation.
Much also depends upon how the point system in your state works.
For example, in California you can receive one point for exceeding the speed limit. (A point will usually be dropped after 39 months.) The accumulation of several points could lead to license revocation or suspension if…
- You receive four points or more within 12 months,
- Six points or more with 24 months,
- Or you receive eight points or more within 36 months.
It’s likely that the more severely your state classifies your driving record, the more your insurance premium will be increased in the event of a speeding ticket.
What to do if you have a speeding violation
Speeding tickets are bound to happen. Sometimes you’re traveling down the road where the speed limit drops suddenly and unexpectedly. Other times you’re just distracted, and you’re not paying close attention to the signs.
But if it does happen, and you get a ticket, here are strategies that you should implement immediately:
- Contest the speeding ticket – In most cases, it will be your word against the police officer’s, so it could be a longshot. But if you win your case, the insurance company won’t hold it against you.
- Slow down from now on – If you already have one speeding ticket, you’ll make the situation a lot worse by adding a second. Become more conscious of your speed, particularly in areas that are heavily patrolled.
- Take a defensive driving course – Some states will drop a moving violation from your record if you take a course. Some courses can even be taken online. There’ll be a cost to take the course, so you’ll have to weigh this out against the cost of the ticket as well as the premium increase over the next three years.
As you can see, getting a speeding ticket will likely cause your premium to increase, but it doesn’t have to be the disaster you might expect it to be. Follow these strategies to minimize the damage.