Putting the Brakes on Road Rage Costs

Most of us shrug off road rage as merely the blustery byproduct of congested highways, electronic driver distractions and the frenetic pace of modern life.

But should push come to bumper-nudge, out-and-out fisticuffs or even Mad Max-style auto demolition, road rage could wreak some serious havoc on your car insurance.

The National Highway Traffic Safety Administration draws a distinction between aggressive driving and road rage. Aggressive driving is dangerous on-the-road behavior such as speeding, tailgating, weaving and running stop signs or red lights. Road rage involves angry or violent behaviors at the extreme end of the aggressive-driving spectrum.

A Criminal Offense

The difference: Aggressive driving typically results in a traffic offense; road rage, beyond the yelling and gesturing stage, can escalate into a criminal offense.

Cross that line, and your car insurance may not follow you.

"Generally, insurance is designed to cover accidents and our own stupidity, not intentional acts," says Michael Randles, president of Insurance Center Associates of San Pedro, Calif. "Most policies have an exclusion for intentional acts with regard to property damage and bodily injury."

Flying off the handle and voiding your insurance can prove far more costly than fixing a fender.

"A dent might only be a couple (of) thousand dollars out of pocket, but the bodily injury you cause can be much higher. It could involve paying for their hospitalization, time off of work, pain and suffering; the whole thing," says Randles.

It's all in the Intent

That said, not all intentions are necessarily bad -- or excluded. "If you were intentionally speeding and ran into somebody, that's covered," says Randles. "But if you intentionally rear-end or sideswipe somebody because you're mad, that's not going to be covered."

Michael Barry of the Insurance Information Institute says the gray area surrounding road rage accidents makes auto insurers particularly nervous.

"Usually there is not a cop who witnesses the whole series of events that lead up to that road rage accident," he says. "Even if you have a couple of witnesses, it can be tougher to nail down than a drunk driver in a way, because the cops carry a breathalyzer. The events leading up to road rage accidents are often more in dispute in terms of who cut off whom."

So what's likely to happen if you engage in road rage?

"What we've seen happen is, the insurance company is probably going to defend you, but under a reservation of rights," says Randles. "That is, if you are found guilty of road rage or aggressive driving, the carrier is not going to be required to pay."

Don't get Mad in California

In California, where extreme road rage is treated as felony assault with a deadly weapon, punishable by up to four years in prison, a $10,000 fine and driver's license suspension, insurance may be the least of your worries.

Barry says it is unlikely that your insurance company will cancel your car insurance outright. "In general, the only two ways that an auto insurer can cancel you is for nonpayment of premium and misrepresentation on your initial application," he says.

More likely, they will either not renew your policy when its term expires (usually one year) "or they may just raise the rates the next time around to the point where the policyholder leaves."That's going to make it more difficult -- and expensive -- to pick up another policy.

"It would be similar to someone who has a reckless driving or DUI conviction. The list of companies that will take you goes down dramatically and their rates are much, much higher," says Randles. "You're going from a preferred or standard-type carrier to a nonstandard carrier where you'll be paying at least double if not triple your current rates."

'He Said, she Said' Defense

And don't rely on the "he started it" defense -- responding in kind to road rage carries its own risks.

"If you're found 50% at fault, that accident is going on your record, too," Randles says. "What's more, if their insurance doesn't cover them because of an intentional accident, yours may not cover you if you contributed to it."

Barry says, "An auto insurer is going to pay out a claim that is covered under the policy, no matter what happened. If it's lawbreaking, you'll get some pushback from your insurer, but the overwhelming majority of crashes are going to get paid out."

But Randles says the only sure way to avoid being sucker-punched by road rage is not to play.

"Just put as much distance between you and the other person as possible, because if they're driving crazy, even if they don't hit you, they're likely to cause an accident up ahead that you definitely don't want to be involved in."