As they say, driving is a privilege and not a right. This means that any mistake you make while driving or owning a vehicle, such as DUI and traffic violations, could potentially revoke your freedom to be on the road. Or, it could at least restrict you in terms of driving a car. This is often treated as an additional burden small businesses shoulder, and they usually don't know what it entails. Fortunately for you, we've covered this subject by starting with defining the nature of SR-22 insurance.
People first thought when told to file for an SR-22 was, "What does SR22 Insurance Cover?"
That's understandable. Many people wouldn't have even heard about this topic until they look at it in the face.
The SR-22 insurance isn't technically an insurance policy. Rather, it's a type of form you file at the DMV. It confirms to the state that your current insurance policy meets California's minimum requirement in liability coverage. This is mainly directed to individuals involved in previous cases like DUI. Particularly if they are looking to reinstate their driving privileges.
In general, the form demonstrates the individual's level of financial responsibility. The insurer must directly coordinate with the DMV throughout the process. They must also ensure that the car's liability limits roughly includes:
After you submit all the necessary documents and pay the fines, expect to receive a copy and confirmation that you're obligated to keep when driving just in case you get pulled over. This is after the DMV has approved your SR-22 insurance.
It's worth noting that SR-22 demands that you list every car you own or drive frequently.
As above, SR-22 insurance is only a requirement if the state deems a person to be a high-risk driver. These typically include those with reckless driving, DUI, driving with a suspended license, or no insurance coverage and at-fault incidents.
Given that you're handling a small business, this may appear as a setback for your business venture. But in truth, it's actually not. You see, this is an excellent opportunity to establish your credibility.
The fact that you've had previous offenses may have been a stain on your driver's reputation. Especially since you're probably using your car for delivering goods to the door of your customers.
Yet with SR-22, you easily prove to police that pulled you over that your business vehicle is operating legally. Hence, saving you the trip to the police station.
Apart from that, it doesn't restrict your driving privileges. Something that is ideal now that many depend on using business vehicles. It gives you the peace that you won't face discrimination from leading insurance partners based on your driving records. Plus, you will have coverage for automobile incidents.
The SR-22 usually expires in about three years. However, this varies based on how grave your past offense is. Once it expires, call the insurance company and have it removed by then.
To be precise, SR-22 insurance is commonly expensive. So, you have to consider several factors in the pricing.
The more that you commit traffic violations, the more likely it is that you'll receive a higher quote. This excludes the expenses for filing the form, and the fee for the DMV to reinstate your license. Plus you lose good driver discounts for a period of up to a decade in the case of a DUI offense.
As a rough estimate, California's insurance companies usually charge $25 in filing for an SR-22. An additional cost of $300 is to restore your driving privileges.
Meanwhile, you'd face higher quotes on insurance premiums depending on the severity and frequency of your driving offenses. For this case, suppose that you were convicted because of DUI.
When you have a clean record, you may encounter an annual price of premiums for as low as $442. But, as soon as you look around with a DUI record, expect to see the cost jump at a rate of $1,019 for an annual payment.
If we'd total the indicated prices, you could assume to spend up to $1,344!
This may be affordable for others, but for a small business owner, this is a considerable amount. It could be a dip into their funding for inventory and make it difficult to continue their operation. Hopefully, this doesn't lead their small business into bankruptcy.
To reduce the cost, it's best that you first explore other insurance companies. They might offer you a relatively cheaper option that'll maximize the value of your dollars. Make sure that you familiarize yourself with their policies, requirements, and rules before signing the paperwork.
If all else fails, then knock on your nearest law firm and approach an expert lawyer in the matter as they may introduce you to alternatives.
