Skip the auto shop - Our mechanics make house calls

How the Demerit Point System Affects Car Insurance Rates

How the Demerit Point System Affects Car Insurance Rates

The point system in traffic parlance refers to the assignment of "points" or values to each infraction you incur. Car insurance companies evaluate the points instead of each infraction when they calculate insurance rates. The insurance companies therefore have a system that may or may not be the same as your state DMV's points system.

Since car insurance companies have their own methods for calculating your rates after you've had accidents and violations, not every company will penalize you the same. If you've recently seen your rate increase after an accident or violation, you can still compare car insurance quotes for a cheaper rate.

Every traffic infraction for which you’re found “guilty” – such as at-fault accidents or driving under the influence – can be assigned a certain point value if your state has a point system in place. Some tickets, such as a parking ticket, typically do not have points associated with them.

For example, a company may use this type of system:

How Demerit Points are Assigned
Description Points:
First Occurence
Points: Second Occurence Points:
Each Additional Occurence
At-Fault Crash 2 3 2
Not-At-Fault Crash 0 0 0
Driving Under the Influence 1 2 3
No-Charge Violation 0 0 0
Major Violation 4 4 4
Minor Violation 2 1 1
Speeding 3 2 2

Some companies’ rating algorithms are complicated, and some are simple. Most of the algorithms used try to put an insurance point value on each infraction or ticket (regardless of the state driving record point system). Based upon that point value, a different rating factor is use to either raise or lower the rate.

The more points you have on your driving record, the worse your record looks to a car insurance company. But because each car insurer has its own method of evaluating applicants, the points on your driving record will impact the rates you pay for insurance differently. However, it's safe to assume that the more points you have, the more you'll pay.

This article is adapted with approval from carinsurance.com: http://www.carinsurance.com/how-do-points-affect-insurance-rates.aspx

The statements expressed above are only for informational purposes and should be independently verified. Please see our terms of service for more details
Icon-warranty_badge-02

Skip the repair shop, our top-rated mechanics come to you.

At your home or office

Choose from 600+ repair, maintenance & diagnostic services. Our top-rated mechanics bring all parts & tools to your location.

Fair & transparent pricing

See labor & parts costs upfront, so you can book with confidence.

12-month, 12,000-mile warranty

Our services are backed by a 12-month, 12,000-mile warranty for your peace of mind.

Get A Quote

Need Help With Your Car?

Our certified mobile mechanics make house calls in over 2,000 U.S. cities. Fast, free online quotes for your car repair.

GET A QUOTE

More related articles

How Long Does a Vacuum Brake Booster Check Valve Last?
The braking system on your car requires a lot of pressure. The vacuum booster is one of the main sources of this pressure. This booster will take the pressure that...
Symptoms of a Bad or Failing Flexible Clutch Hose
Common signs include difficulty shifting, low clutch fluid, and feeling no resistance at the clutch pedal.
P0359 OBD-II Trouble Code: Ignition Coil I Primary/Secondary Circuit Malfunction
P0359 code definition The P0359 code indicates that a fault has been detected in one of the vehicle’s ignition coils, generally the number 9 coil. This code can also be associated...


Related questions

Q: Do I need gap insurance?

Gap insurance is designed to cover the difference between what is owed on the vehicle (your car loan) and what the insurance company may pay out in the event of an accident or loss. Any example might be a situation...

Q: My 2003 Subaru WRX crashed and my insurance is giving me two options.

I would recommend taking the $6000 and getting another car with the money. The body damage is only an estimate of the damages the body shop can see and estimate. There is always hidden damage the body shop cannot see...

Q: Hit a car and want to know the best way to go about this persons repair.

This would all depend on the extent of the damage caused by the accident. If the paint damages on a very large surface it would probably be best to go through the insurance company to make sure it gets repaired...