For anyone who has gotten a DUI or DWI, there are several ramifications which will follow them for years, and one of them is a harsher set of requirements to satisfy in order to obtain an affordable life insurance policy. Fortunately, independent agents like ourselves have been helping clients get life insurance after a DUI with very high success rates, and exceptional premiums.
The company you apply with makes all the difference.
Guide To Buying Life Insurance After A DUI
The Federal Bureau of Investigation published statistics amounting to nearly 1.2 million arrests per year for driving under the influence, which equates to more than 3,000 DUI charges every single day in America. An even more shocking statistic, the National Highway Traffic Safety Administration found one person is killed every single hour due to drunk driving.
This is why a DUI will hurt your life insurance premiums. Many individuals we speak with think it’s limited to an increase in auto insurance, but this is absolutely false. Your driving record, or Motor Vehicle Record (MVR) is almost always taken into account when buying life insurance.
How Underwriting Works
When you’re looking to buy life insurance, the insurance company needs to assess your total risk to the company, including all aspects of your life. Your medical history matters, of course, but so do your daily activities, tobacco use, alcohol use, driving record, family history and more.
The most basic factors in determining rates are:
- Amount of Coverage
- Duration of Coverage
- and Tobacco Use
However, only the age and gender would aid an underwriter in determining your risk profile, and even those can be very broad. For example, the average life expectancy of males and females in the United States are 77 and 82, respectively. But if you knew the person used tobacco, those ages drop by more than a decade!
Because statistics are available proving the increased risk of dying if driving while under the influence of alcohol or drugs, an insurance carrier has to take it into consideration. Obviously, a person with a previous DUI or DWI on their record is the highest risk for the category.
Risk Factors Of Your Driving Record
So, anyone who has gotten a DUI before can expect crazy high rates, right? Not exactly. There are several factors at play, and you may be surprised relaxed some life insurance carriers are when it comes to impaired drivers. Here are those factors:
- Date of First Offense
- Total Number of Offenses
- Current Litigation Status
- Other Major Non-DUI Offenses
Date of First Offense
The first, and perhaps the most important, factor is how much time has passed since your DUI was settled. Some companies will not even allow you to apply until the event is 2 years past. For others, it may be more. Once enough time has passed, you can apply, but you may still only be eligible for certain rates.
A typical time table for possible rates might look like this:
- Preferred Plus – Nothing within 5 years
- Preferred – Nothing within 5 years
- Standard Plus – Nothing within 3 years
- Standard – Nothing within 2 years
So, based on your original date alone, this will already have a significant impact on approval and premiums.
Total Number of Offenses
The next most key factor in determining both eligibility and risk class when buying life insurance after a DUI is the number of infractions on your record. If you have multiple DUI’s within a certain time frame, most companies will not consider you at all. The time table considered is generally 5 years, although a handful of more conservative carriers may ask for your driving record over the last 10.
One thing to note: more than one offense doesn’t always just mean a DUI or DWI. As you’ll read below, the entirety of your Motor Vehicle Record matters.
Current Litigation Status
Your understanding of where you currently stand with the letter of the law is also a major factor. You must realize your date of arrest is not your date of conviction. This is called criminal procedure.
- Your arrest date is the date on which you were detained for driving under the influence.
- Your conviction date is the date on which you were declared guilty by the court, and sentenced charges.
The reason this matters will depend on what your charges are, and the consequences you face. This may also change from state to state.
If you are required jail time, driving school courses, community service or other punishment, many life insurance companies will need to see these completely finished before they will consider the clock to have started. In other words, you will have to wait to apply until 2 years has passed from when these were completed, not since your date of arrest!
Other Major Non-DUI Offenses
For some drivers, a DUI is not their first or last offense. In this case, the accumulation of multiple infractions means harsher penalties, and this is not exclusive from insurance.
Even though you may have suffered just one DUI or DWI, previous tickets, suspensions and revocations will also be considered. A very minor speeding ticket may stack up against you, but any misdemeanors or felonies against your record will count.
Two or more major hits to your driver’s history and you may not be eligible to apply for life insurance, regardless of whether they were both DUI or not!
Costs Of Life Insurance With A DUI On Record
Once you and your agent are confident you can proceed in applying, you’ll next need to know what different ratings mean, what premium additions to expect, and what you can do to keep rates down as much as possible before you can re-apply.
There are several ways your premiums will change.
- Loss of Discount
- Increased Rating
- Flat Fees
The first is pretty self-explanatory. If you’re within the 2-5 year window, you may lose any possible discounts, making Preferred Plus impossible.
The second is in regards to your actual approval rating. Many carriers allow sub-standard rates, which go off of a table rating system. Each table rating, up to a maximum of 10, means an increase in base policy premiums of 25%. So, for example, a Standard Table 4 is 100% more costly than a Standard.
The third is how most companies (but not all) will assess extra high rates on DUI life insurance policies. A flat extra fee, usually just referred to as a flat extra, is literally an annual increase in premium at the discretion of the carrier. The flat extra is a dollar cost per thousand addition to the base premium. In other words, a $2.50 flat extra on a policy of $100,000 in coverage means an additional $250 added to the annual premium amount.
Can I get life insurance if I’ve gotten a DUI within 1 year?
Yes. We know of several carriers who will make an offer of insurance, but expect either a Standard Table 2 class rating or a flat extra fee. We even know of one who will offer as high as Standard Plus after the first year has passed.
Will this DUI affect my life insurance rates indefinitely?
No. Although it may stay on your criminal record indefinitely, most insurance companies will no longer consider it outside of a certain time table, usually 5 or 10 years, depending on your number of infractions.
Are there any extra forms, like the SR-22 for life insurance?
No. These are strictly for car insurance. With regards to life insurance, supplemental documentation may be needed and added as a cover letter if extra detail is needed, but your agent will handle this.
Which company should I apply to?
This is perhaps one of the most important questions, yet there is not always a clear cut answer. We work with more than 50 carriers who handle high risk life insurance of all kinds, and all of their underwriting guidelines are different. We have several which we use most because of their liberal approvals, but they can change. Contact us and we’ll find you the most appropriate one.
I was already declined by my car insurance company when I tried to buy life insurance from them. Will this affect my rates?
No. Most companies who offer car insurance, homeowner’s or other personal or business liability coverage are poor choices for life insurance. Fortunately, it will not affect future applications other than the fact the insurance company will see a previous decline. It will raise a flag, but won’t adversely hurt premiums.
What if I can’t get covered?
There’s a great chance we can find you coverage, no matter what your situation involves. It may cost a lot more, but if you are desperate for a life insurance policy, we can get you covered despite your driving record.