Auto Insurance & DUIs: Why Did My Rates Go Up?

It’s not just Oregon auto insurance providers that hike up the rates for anyone convicted with a DUI; it’s a nation-wide trend. There is no set rate increase, so the price hike can be set by each insurance company separately. The rates vary from one auto insurance company to the next, and drivers convicted of a DUI can expect their insurance rates to increase. It may only be by a couple hundred dollars over the policy term, or their rates may double, triple, or even quadruple. 

 

So, why exactly does a DUI make insurance rates spike? In order to understand that, you have to understand how auto insurance providers calculate their rates to begin with. When we talk about insurance here, we’re talking specifically about auto insurance, but this process is similar across any type of insurance. Basically, insurance providers use incredibly complex formulas that they use to determine how much of a risk each individual is likely to be. That formula looks at the type of car being driven, where they live, how much the car is driven, how old a person is/how long they’ve been driving, how many accidents and tickets they have, and more. All of those factors tell an insurance provider how likely a person is to have an accident or otherwise have something happen for which the insurance company would need to pay out. Basically, the less risky that actuarial formula says someone is, the lower their insurance premiums. This is also why anyone with a DUI conviction is likely to see their insurance rates jump up. Being convicted of a DUI tells insurance providers that someone is more risky to insure. Since everyone who drives is required by law to have auto insurance, insurance providers raise their rates for those individuals to compensate for taking on that additional risk. In most cases, that rate hike will stay in effect for five years following the DUI conviction, since that is the general rule of thumb for how long an insurance company will include that factor as part of their risk assessment. However, if that is the only major risk factor, rates will start dropping over time as a policy holder demonstrates that they learned from their mistakes and is otherwise a safe driver.

If someone loses their license due to a DUI conviction, they won’t be driving for the period of time mandated by the courts. In those instances, it makes sense to wonder whether or not you can just stop carrying insurance for that time period. In general, the answer is no. Auto insurance is unique in that it follows the car, not just the driver. When you set up an insurance policy, they ask for basic driving-related details about you as the policy holder, but they also need details about any vehicles you own. That way, if someone else is driving your vehicle and gets into an accident, your car will still be covered by your policy. Even if your license is suspended due to a DUI conviction, you will need to keep your insurance active to ensure your car is protected.