A speeding ticket has many more implications beyond the fine itself, as it becomes a process of reevaluation by the insurance company, which implies an increase in insurance costs. According to national analyses reported by Forbes, the average increase in car insurance premiums after a violation is around 26%. This increase, which can mean an extra expense of $500 to $600 per year, can vary depending on the state and the insurance company. In Michigan, offending drivers may experience a 54% increase, while in Texas it is only 13%.
While companies like State Farm apply a 12% increase, others like Mercury and Progressive impose penalties approaching 39% and 29% respectively. Furthermore, the severity of the offense and the accumulation of points on the license, as in Ohio, increase this cost, forcing the driver to deal with the consequences for several years.
Direct impact on the policy
The main consequence of a traffic violation, beyond paying the fine itself, is the impact it has on the annual cost of insurance. The fine is reported to the insurance company, showing that the driver has exhibited risky behavior, which automatically justifies a higher premium. National studies show that this adjustment is variable, but generally high. On average, drivers should be prepared to pay about 26% more for their insurance.
For many, this translates to an additional $500 to $600 each year. The rate of increase is not uniform, but depends on state regulations regarding how companies can apply surcharges. For example, while drivers in Texas experience increases of around 13%, drivers in Michigan may see their rates soar up to 54%. This disparity reflects the differences in state insurance regulations.
Key differences between insurance companies
The choice of insurance company also plays a crucial role in the amount of the annual increase. Data reveals a wide variation in how different insurers penalize a speeding violation:
- State Farm applies a 12% increase after a violation.
- Companies like Progressive and Mercury are at the higher end, with increases around 29% and 39%, respectively.
In addition to the company’s name, the speed at which the violation was recorded is a determining factor. Violations in the range of 11 to 15 mph over the limit routinely push premiums to mid-20% increases, and even higher speeds result in even larger hikes. An interesting fact is that owning a foreign-brand car could increase the chances of receiving a ticket.
Long-term consequences
The impact of a fine is not limited to the initial payment. Once it appears on the record, it usually remains for a period of three to five years, depending on the legislation of the autonomous community or state. While the infraction is on record, the driver is subject to higher premiums at each insurance renewal.
However, the problem worsens with repeated violations, as drivers with multiple fines are seen as significantly higher risk, leading insurers to impose rate increases of 43% or more after a second violation. This cumulative effect highlights how each new infraction increases the perceived risk of future claims. Nevertheless, some insurers offer a small relief, gradually reducing the surcharge for each year the driver goes without accumulating a new fine.
Damage and points system
In some states, such as Ohio, the system is point-based. A speeding ticket generally adds two points to the record. Accumulating 12 points can even lead to a suspension of the driver’s license. In this situation, there are several strategies to mitigate the financial impact:
- Training Courses: Taking an approved driving course can, in some cases, reduce points on the record or avoid a premium surcharge.
- Increase the Deductible: Another tactic is to raise the deductible (the amount paid out of pocket in case of a claim), which often lowers the monthly premium, though it requires being comfortable with a higher out-of-pocket cost in the event of an accident.
- Compare and Switch Insurers: Since not all companies handle tickets the same way, looking for other offers after an increase may be the best way to find an insurer that applies a smaller penalty for the violation.