How Your Driving Record Could Affect Your Life Insurance
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UPDATED: Aug 14, 2020
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While you already know your driving record directly affects your car insurance rates, you might not realize it can also have an impact on your life insurance.
Whether you’re shopping for a life insurance policy or you already have coverage in place, you should know that a lack of good standing with the DMV (Department of Motor Vehicles) could have consequences.
Reasons to Clean up Your Driving for the Sake of Your Life Insurance
1. A Bad Driving Record Could Cost You More Money
If you have a poor driving record (traffic violations, accidents for which you were at fault, or DUI charges) and are applying for life insurance, you might either have difficulty getting approved for a policy or you’ll probably pay a higher premium than you would with a clean record. A bad driving record could be enough to bump you from a preferred rating class to a less ideal one. Life insurance companies rate you according to a number of different health and lifestyle factors. If you’ve been a bad driver, they’ll consider you a higher risk. The end result: you’ll pay more.
2. Your Policy Might Not Provide Coverage if You Were at Fault of an Accident
Provided you were honest on your life insurance application, didn’t hide an existing drinking problem or vehicle violations, and have had your policy for at least two years, most companies will pay a death benefit to your beneficiaries regardless of your cause of death.
There have been some instances, however, where insurance companies have fought claims in court based on the premise that when an insured person’s death is caused by his voluntary use of a substance, it’s a foreseeable result of driving under the influence rather than an accident.
Could that same logic be applied to driving distracted, like texting or talking on a phone while driving?
According to a CDC survey in 2011, “31% of U.S. drivers ages 18-64 reported that they had read or sent text messages or email messages while driving at least once within the 30 days before taking the survey.” The agency’s statistics also show that from 2011 to 2012, the number of people injured in crashes caused by distracted driving increased by 9%.
It would make sense that insurance companies consider this as they look to minimize risk and preserve their bottom lines. That gives you one more good reason not to text, respond to emails, and dial your friends while driving.
Read and Ask Questions
All insurance companies are different, so read your policy carefully to see if there are any exclusions because there are things to consider when comparing life insurance companies. If the language is unclear, ask your insurance agent for clarification.
And remember, even if you do have a driving record that’s not entirely spotless, you could benefit from looking into term life insurance. With more affordable premiums than permanent life insurance, term life can give you and your family peace of mind without breaking the bank.
Get a term life insurance quote quickly and conveniently online and talk with a trusted insurance professional about your term life options.