HOW A DUI IMPACTS YOUR LIFE INSURANCE RATES

Paper family of four under a Life Insurance paper cutout umbrella

Think a DUI only affects your driver’s license? Apart from your job, college education, and other penalties, a DUI can impact your insurance premium rates. These higher premiums do not only apply to your car insurance rates, but also to your life insurance rates too. To make matters worse, insurance companies can completely decline to give you a life insurance policy. Most life insurance companies in the state of California and in many other states charge much higher life insurance premiums for applicants that have been caught driving under the influence (DUI).

Anyone convicted of a DUI/DWI offense within the last decade will likely pay higher premiums than the average person. Similarly, insurance companies are at liberty to deny individuals with more than one DUI arrest life insurance coverage ad infinitum. Jeanne Salvatore, who is the spokeswoman for the Insurance Information Institute, says that the reason behind such stringent measures in the industry is to deter drunk driving and other reckless traffic crimes. Based on national statistics from the National Highway Traffic Safety Administration, life insurance companies have good reason to deny the person the right to life coverage. A report by the National Highway Traffic Safety Administration found that the chances of a person with a DUI getting involved in a fatal road accident are 40% higher than a person who has never been convicted of a DUI. From data gathered between 2007-2011, the NHTSA found that drivers from 22 states who were convicted of DUIs were repeat offenders.  

The death rate of those convicted of DUIs is higher than those without, making DUI Offenders less appealing to life insurance firms that are for-profit companies. The Centre for Disease Control states that drunk driving is a sign of impaired judgment and suggests that this is also a sign of alcoholism. Alcoholism increases the probability of a person dying of other types of accidents or health complications like liver disease, high blood pressure, heart problems, and different types of cancers.

Below is a breakdown of the problems that await a person convicted of a DUI applying for life insurance.

Within the first year of a DUI conviction, insurance providers raise rates. For some insurance companies that operate in California such as Banner, SBLI, AIG, the DUI convict is completely denied coverage for 24 months. Even after the two-year period has passed, most people with DUI convictions will still be subject to higher rates.  The lookback period is considered when deciding the rate increase.

It is common practice in the insurance industry to deny DUI convicts best-preferred rates if the person has a DUI in the last five years. Indeed, some insurers are very serious about DUI offenders and will deny life insurance coverage with preferred rates for up to a decade. For the insurance companies that agree to overlook the DUI charge a year after the offense is committed, they charge an extra premium on top of their standard rates. Prudential Financial and Nationwide Mutual Insurance Company are insurers known for this practice.  Past DUI offenders should expect to pay up to $7.50 for every $1,000 of life insurance coverage that they purchase. This can be temporary or for the duration of the policy.

There is hope for a person who is convicted of a DUI to obtain reasonable life insurance coverage. As mentioned above, most insurers consider each case on an individual basis, which makes it possible to find life insurance coverage. You have the option of fighting the DUI charge altogether or beginning the expungement process if you’ve already been convicted. Our Step by Step guide on processing your DUI expungement should be the first place to look if you want the opportunity to start fresh. Criminal Defense Hero is here to help. Reach out to us today so we can get your life back on track.

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