How Unpaid Parking Tickets can Jack up Your Insurance Rates

Question: Will having my license suspended, due to something non-driving related such as failure to pay parking tickets, affect my car insurance rates?

Answer:  Yes, your suspended license will affect your auto insurance premiums because it will be noted on your motor vehicle record.

Your driving record is normally pulled at the inception of an auto insurance policy and before the end of your policy term, when it's time to see if your insurer will renew your policy.

While parking tickets alone are usually of no concern to an insurance provider, if your insurer sees that you've lost your driving privileges for unpaid tickets, it will definitely take notice.  How much it focuses on the suspension and how much that can affect your rates depends upon the underwriting rules and rating system of your car insurance company.

Insurance providers will usually charge a suspended driver's license like yours as a minor violation, so at very least it would cause you to lose your safe driver discount (if you had one previously). Depending on your insurer and state, your rates could actually rise, too.

For an example, we ran quotes for a 40-year-old woman in Albany, N.Y., driving a 2012 Prius.  With a clean driving record, her annual premium was $1,064.  But if she informed the insurer that there was a suspension and reinstatement of her license in the last year, her rates more than doubled to $2,774 a year.

If you had a major offense on your record, such as a DUI, in connection with the suspension, then rates would go up even more because your insurer would be rating you on that violation as well.

If you are unable to get your license reinstated in a short period of time, there is a good chance that your car insurance company will not renew your policy. Your insurer wants you to have a valid license, and some insurers require it to keep your policy valid.  In some states, such as Illinois and Maine, your policy can be canceled midterm if your insurer finds out you have a suspended license.

If you drive while your license is suspended and crash, it's likely that the incident will be covered, unless your policy specifically states that you must have a valid license for your coverages to be in force.

We would, however, discourage you from driving with a suspended license. In many states this is a major offense with harsh penalties -- and of course frowned upon by your insurance company even more than just having a suspended license - meaning that your policy likely would be canceled and a new insurer would ask for much higher rates.

The original article can be found at suspension from unpaid parking tickets affect my rates?