Non-standard auto insurance
Non-standard auto insurance is car coverage for a driver an insurer classifies as higher-than-average risk, often because of driving history, limited experience, claims, vehicle characteristics or prior insurance history. It can include ordinary liability and vehicle coverages, but premium, eligibility, limits, deductibles and exclusions depend on the insurer, policy and state law.
Also called: non-standard market, assigned risk, residual market, high-risk driver
Non-standard is a label for where an insurer places you, not a description of what your policy pays. It mainly affects your premium and whether a given insurer will write the policy at all. What the policy pays after a crash still comes from the coverages, limits, deductibles and exclusions on your declarations page and in the policy form.
How a non-standard policy pays a claim
The classification changes the price and possibly your eligibility, but the claim arithmetic works the same way it does on any auto policy. A sample declarations page from the NAIC consumer shopping tool (opens in a new tab) shows a $640 policy premium, a $500 collision deductible and a $100 comprehensive deductible. Apply those figures to a $3,000 covered collision loss.
Hover or tap a row to highlight it.
| Item | Amount |
|---|---|
| Total repair cost | $3,000 |
| Collision deductible you pay | $500 |
| Insurer pays ($3,000 minus $500) | $2,500 |
| Policy premium for the period (sample) | $640 |
The $640 premium is a sample figure, not an average for the non-standard market. Premiums in New York's assigned-risk Auto Plan are generally higher because that group's loss experience has been worse than the voluntary market's, according to the New York Department of Financial Services (opens in a new tab). Your own premium comes from a written quote by the insurer or plan.
Coverage choices that change price and payout
A non-standard policy is not limited to the legal minimum. Depending on the insurer and state, you may be able to add collision coverage, comprehensive coverage, rental reimbursement, medical payments, uninsured motorist coverage and higher liability limits. Each choice moves the premium and the amount available after a loss.
- Liability limits. Connecticut's minimums are $25,000 per person and $50,000 per accident for bodily injury, $25,000 per accident for property damage, and at least $25,000/$50,000 of uninsured and underinsured motorist coverage, according to the Connecticut Insurance Department (opens in a new tab). Higher limits cost more and raise the most the policy pays on a covered liability claim.
- New York limits. New York requires 25/50/10 liability, $50,000 of basic no-fault coverage and $25,000/$50,000 of uninsured motorist coverage, and offers higher options such as $100,000/$300,000 and $250,000/$500,000, according to New York DFS (opens in a new tab).
- Deductibles. Typical collision and comprehensive deductibles are $250, $500 and $1,000, according to the NAIC consumer guide to auto insurance (opens in a new tab). A higher deductible lowers the premium and raises what you pay on a covered vehicle claim.
- Rental reimbursement. The NAIC sample shows $30 per day up to $1,000. A higher daily amount or maximum raises the premium and the possible benefit.
- Assigned-risk placement. When voluntary-market coverage is unavailable, a state plan may assign you to an insurer, and that plan can have its own limits, rules, fees and rating.
Dropping collision or comprehensive lowers the premium, but you then pay for those vehicle losses yourself unless another party is responsible.
Where you see the label
The term belongs to private-passenger auto insurance. You might see it on a quote or application as an underwriting tier, on a declarations page that names a rating tier or assigned-risk status, or on a renewal notice when your tier, premium or market placement changes. It can also appear in a cancellation or nonrenewal notice alongside information about an assigned-risk plan. If it shows up in a claim letter, it identifies the policy; the label itself does not decide the claim.
It helps to keep three related ideas apart. "High-risk driver" describes you as the applicant. "Non-standard" describes the market or tier the insurer uses for that risk, often written voluntarily by specialized insurers. "Assigned risk" or "residual market" is the state mechanism for people who cannot get required coverage through ordinary channels.
Connecticut and New York rules on assigned-risk access
In Connecticut, an insurer that cancels auto liability coverage for a reason other than nonpayment, or fails to renew it, must tell you that you may be eligible for the assigned-risk plan, and that notice comes with the cancellation or nonrenewal notice under Conn. Gen. Stat. § 38a-345 (opens in a new tab). Conn. Gen. Stat. § 38a-385 (opens in a new tab) makes the assigned-risk plan available to applicants who are in good faith entitled to coverage but cannot get it through ordinary methods.
In New York, every insurer licensed to write motor-vehicle insurance must take part in the assigned-risk plan under N.Y. Insurance Law § 5301 (opens in a new tab), and assigned-risk rate filings need prior approval under N.Y. Insurance Law § 2305 (opens in a new tab). Nonrenewal notices for non-commercial vehicles generally must be mailed 45 to 60 days before the policy expires, according to New York DFS (opens in a new tab).
Questions to ask an agent or insurer
- Is this voluntary non-standard coverage or an assigned-risk policy? Assigned-risk plans have their own eligibility, assignment, rating and broker-fee rules.
- Which coverages, limits, deductibles, exclusions and endorsements are on my declarations page? Those documents, not the label, decide what the policy pays.
- Which underwriting factor placed me in this tier, and when will you reassess it? Driving history, claims, vehicle, prior insurance and experience can all affect your tier at renewal.
- What would I pay after a covered collision or comprehensive loss? Your deductible comes off the claim payment.
- What happens to my premium or eligibility after a claim, ticket, license suspension or change in how I use the car? State rules and rating plans may allow surcharges, cancellation, nonrenewal or reassignment.
Frequently asked questions
These are the questions that come up most when a quote or renewal says non-standard.
Is non-standard auto insurance the same as assigned-risk insurance?
No. Assigned risk is a residual-market plan for people who cannot get coverage through ordinary voluntary channels. Many non-standard policies are sold voluntarily by insurers that write higher-risk drivers, so an agent may be able to quote both.
Does a non-standard policy cover accidents?
It can. A covered loss is paid according to the policy's limits, exclusions, conditions and deductible, and the non-standard label alone neither approves nor denies a claim.
Do I have to list everyone in my household?
Generally, all licensed household members with access to the vehicle must be listed, according to the Connecticut Insurance Department (opens in a new tab). Leaving out drivers, claims, convictions, vehicle use or your address can lead to extra premium, cancellation, nonrenewal or a claim dispute.
How do I move out of the non-standard market?
Ask when the insurer will reassess the factors behind your placement, keep your coverage continuous, and request quotes with identical coverages and limits so the prices are comparable. Our guide on how to switch car insurance walks through timing a change. Eligibility and timing vary by insurer and state.