Auto insurance fines: see how it works!

Do you have some traffic fines and are you worried whether they will interfere with taking out car insurance? Follow this article and find out how fines affect your car insurance.

Many people have doubts about the conditions for accepting car insurance or guaranteeing coverage in relation to fines, whether paid or outstanding. This is normal, after all, what driver has never received a fine?

In this article, you will better understand how taking out car insurance works and guaranteeing coverage in the case of drivers who have paid or outstanding fines. Keep reading and find out how fines affect your car insurance.

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Contracting: how fines affect your car insurance

If you have one or more fines linked to your vehicle and are looking to take out car insurance, you need to know that they could influence two issues in this process, the acceptance of insurance coverage and the pricing of the policy.

It is worth mentioning that not all insurance companies consider fines in these situations, however, most of them do. See below how the fines affect your car insurance when hiring the service.

How fines act in acceptance of car insurance?

Most insurers consider some aspects important for accepting the vehicle under auto insurance coverage. These include chassis analysis, license plate consultation, mechanical, electrical and bodywork assessment and, in some cases, the existence of fines.

These criteria are always established individually by each insurer. This flexibility of rules ends up making some companies more rigorous in their acceptance processes. This means that, if you have a lot of fines, it is quite possible that the insurance company will not agree to protect your vehicle.

How fines act in pricing of car insurance?

As mentioned, some insurers accept the fact that the driver has some, or even many, fines. However, in these cases, they end up appearing as risk factors in the driver profile analysis.

In other words, the more fines the driver has, the greater the chances of him being involved in problems or accidents. And, consequently, the final price of his insurance policy may be higher.

In other words, the fewer or no fines you have, the greater the chances of your car getting good coverage or even paying a lower amount when hiring the service.

These are the two ways in which fines affect car insurance when hiring the service.

Coverage guarantee: how fines affect your car insurance

Just as fines affect your car insurance at the time of contracting, they can also influence the guarantee of car insurance coverage. However, in the case of coverage guarantee there is no possibility of fines having an influence or not.

Unlike the first case, when it comes to guaranteeing coverage there are no variations, as a rule for all insurance companies, they have always influenced this aspect. See below how they can influence cases such as partial loss, damage to third parties and total loss.

How fines act in cases of partial loss claim?

Partial loss claims are those accidents where the vehicle suffers damage of less than 75% of the commercial purchase value of the same model. In these cases, when activating the insurance, the insured must pay a deductible for the repair to be carried out.

In these cases, if you only have small fines, there is nothing to worry about, as they did not influence the acceptance of repairs to your vehicle. But, if we are talking about high fines, which could lead to the seizure of the vehicle, the situation will be different.

In these more serious cases of fines, the vehicle could not be driven, so it is possible that the insurance company will refuse to cover the necessary repairs. Everything will depend on the insurance company's analysis to make sure that you were not violating any traffic rules when driving the vehicle with high fines.

How fines act in cases of third party damage claim?

In the case of claims involving damage to third parties, the same rule mentioned above is considered. In other words, if you only have small accounts, don't worry about securing insurance coverage. However, if they are more serious, it will be necessary to have an analysis from the insurance company to receive the necessary compensation.

How fines act in cases of total loss claim?

Total loss claims are those in which the vehicle suffers damage with a repair value equal to or greater than 75% of the vehicle's market value. In these cases, the insured does not need to pay any deductible to receive compensation, which is generally the current purchase value of the vehicle according to the FIPE table.

Total loss claims can occur as a result of a serious collision, fire, or in cases of theft or theft where the vehicle is not recovered. When this occurs, the insurer pays the insured person full compensation, which may be in accordance with the market price or a fixed amount previously stipulated in the contract. As if she was buying the scrapped vehicle.

As this compensation process works as a purchase and sale process, all pending issues on the vehicle must be settled. This includes documentation, financing and fines.

If you suffer a total loss claim and your vehicle has outstanding fines, the insurance company may offer two ways to resolve this issue. The first option is for the insured to pay off the outstanding debts on the vehicle so that he or she receives full compensation. The second is that the insurer pays off all debts on the vehicle and deducts this amount from the compensation.

Pay attention, as this condition must be clearly detailed in the insurance policy. Typically, the insurer specifies this condition in the “general car insurance conditions” section.

Now that you know all the ways in which fines affect your car insurance, it will be much easier to understand all the processes of contracting or guaranteeing your insurance coverage, always considering the insurance company's conditions.