Driving History and What it Can Do to Your Insurance Rates

*This article is updated from its original version published on Dec 22, 2016 

Like obtaining a mortgage or credit card, insurance companies will want to know your past history when determining your insurance rates. First and foremost on any insurers mind is risk. The riskier you are determined to be as a client, the higher your rates will be. A clean history generally shows you to be a lower risk, and hence you will be offered lower rates. But let’s take a deeper dive into the other issues that are on insurers’ mind. 

Let’s start with issues that aren’t even related to driving. Samantha Schmidt is an Underwriting Specialist with Surex. She says drivers can be surprised by how past administrative or disclosure issues can affect future insurance options. “Cancellations for non‑payment, for example, may seem minor at the time but can remain part of a driver’s insurance history. Insurers typically view these differently from a voluntary non‑renewal, and repeated non-payment cancellations can limit eligibility or payment options with certain carriers. There is added affect to the rates when there is a lapse in insurance coverage due to the non-payment as that is considered a ‘rateable lapse’.” 

Related, but not exactly the same, is misrepresentation – even unintentional misrepresentation. For example, if you miss details about your vehicle use, listed drivers or prior insurance history, you may find yourself with some sticker stock from your new insurer. Schmidt notes that when a policy is cancelled or voided for misrepresentation, future applications are usually reviewed more closely. 

Now that we’ve looked at past behaviour and payment records, we can take a look at more commonly known issues.  

Minor Violations: Most tickets issued to drivers fall under this category. They can include speeding tickets, minor traffic violations like failure to signal or not wearing a seatbelt, and being distracted, such as using a device. In that latter case, insurance companies may look at that more harshly than the police. 

Major Violations: These can include excessive speeding, school zone violations and at-fault accidents. 

Serious Violations: Severe driving offenses can carry the heaviest penalties. Things like driving under the influence, dangerous driving, street racing and failing to stop at the scene of an accident can either boost your rates to the highest levels, or worst case scenario, prevent you from getting/keeping insurance at all. 

Labelling violations major or minor may change your fines and penalties from a police standpoint, but different insurance companies may take into account the risks involved. Someone using a cellphone or being distracted may an indication of future behaviour and driving ability, which an insurance company may penalize you for. 

Schmidt offers tips to drivers seeking to reduce rates or avoid penalties (and/or higher rates): 

• Be transparent, even when something feels minor: Issues like payment problems, past cancellations, or changes in vehicle use are usually better disclosed upfront. Surprises discovered later tend to cause more problems than the issue itself. Failure to disclose information can result in a claims denial and/or your policy being cancelled for misrepresentation which will be recorded on your insurance history for other insurers to see.  
• Avoid frequent small claims when possible: While coverage is there to be used, repeated claims—especially for smaller losses—can signal higher risk to insurers depending on frequency and timing. 
• Think long-term, not just short-term savings: Maintaining consistent coverage, accurate information, and a clean recent record often provide more value over time than switching frequently for small price differences. It also benefits to save you from rate increases where you may be protected by the Good Driver Rate Cap in provinces like Alberta for example.  

What’s most important is not just how long ago an issue occurred, but what a driver’s behaviour has looked like since. Clean, consistent driving and insurance history afterward can make a meaningful difference. No matter a driver’s age or experience level, insurers generally reward stability—clear documentation, continuous insurance, and fewer surprises over time.  

Insurance companies will vary in terms of the length of time your violations may stay on your record, but generally speaking ,the timing is about three to six years for minor and major violations. Criminal Code offences have a much longer-lasting impact. A DUI conviction can stay on your driving record for up to 10 years and may affect your insurance rates for the entire duration. During this period, you may be classified as a “high-risk” driver, requiring specialized (and more expensive) insurance.  

It’s important to remember that even after a violation is removed from your file, some insurers may still ask about your driving history beyond the six-year period when you apply for a new policy.  

“Insurers don’t just look at how long someone has been licensed,” says Schmidt. “In many cases, they’re more focused on how long someone has been insured and their recent driving behaviour. Namely, claims, suspensions and convictions are strongly monitored. Those factors can matter just as much—sometimes more—than total years behind the wheel.” 

In Canada it’s important to note the different rules from province-to-province. Experience from one province (or another part of the world) may not be recognized in your current region. This too, could affect your rates, even if you are a driver with a long history. 

That said, newer drivers can benefit from recent accredited driver training. Most insurance companies offer discounts to drivers who completed accredited driving courses. Also, the skills you learn can help you maintain a clean driving record. 

Consider telematics. These devices or apps can monitor your driving habits by tracking your speed or braking patterns, for example. Good driving is rewarded by your insurance company with discounts on your rates. If you’re generally safe, this can be a good motivator to stay that way. It’s also important to review your policy. Never thinking about it may cost you money, especially as violations fall off your record. Either your current provider ,or others, may offer competitive rates if you shop around. 

It goes without saying that maintaining good habits and a clean record will keep rates down today and into the future. Obey the rules, don’t overthink it, and be honest with your provider. That is the kind of low-risk history your provider will reward you for.