How Car Insurance History Affects Your Rate

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Written by Eric Schad Edited by Nick Versaw

Updated April 19, 2023

Plenty of components go into what an insurance company charges you for an auto insurance policy. However, one aspect that many drivers don’t think about is their car insurance history. This history — including providing proof of prior insurance — can make a drastic impact on your auto insurance rates. So if you’re shopping for insurance coverage or want to switch insurance providers, learn more about car insurance history. Your rate depends on it.

What is Car Insurance History?

No, we’re not talking about the actual history of car insurance itself here, as interesting as it is. Car insurance history, as it refers to your rate and insurance products, is a document that contains:

• All of your past insurance providers
• The cars you’ve had insured
• Any claims you’ve made after a car accident or other incident — whether at fault or not
• Any lapses in coverage

This is one of many factors that car insurance companies use to set your rate. If you’re switching to a new automobile insurance company, they often ask for proof of prior insurance as part of their underwriting process. They also look at factors like driving record, address, gender, credit score, marital status, and more.

How Car Insurance History Affects Your Rate

Although car insurance history is just one of many factors that impact your insurance costs, insurance companies put a premium on it. Your history provides insight into your driving habits, level of personal and financial responsibility, and overall level of risk — the greatest determinant of your insurance premium rates.

In a best-case scenario, car insurance history is low impact. This means that you’ve never had a lapse in coverage or filed an insurance claim. On the other hand, your car insurance history can drastically increase your car insurance rates if you’ve had one or more lapses in coverage or filed multiple claims.

A Look at the Stats

If you want to know how much proof of prior insurance affects your rates, here are price averages from real insurance customers:

As you can see, proof of prior insurance makes a sizable difference in what you pay. Ensure you maintain proof of insurance and don’t allow your insurance to lapse. By doing so, you ensure that you pay far less.

Why You Should Never Let Your Insurance Lapse

There are many reasons why you should never let your car insurance lapse. You may feel the temptation to ignore insurance if you live in a rural area or want to cut down on expenses, but driving uninsured is a terrible idea.

Almost every state has minimum insurance laws. Only two don’t: In New Hampshire, insurance isn’t compulsory. In Virginia, you can opt out of insurance for a $500 annual fee.

If you let your insurance lapse and no longer have state minimum insurance, a law enforcement officer can cite you for failure to provide proof of insurance. If you’re charged with this, you can face a fine on top of having to show proof of insurance in the future. You’ll also pay more when you do get a policy. Insurance companies deem you a higher risk when you let your insurance lapse, and you’re almost guaranteed to pay more than if you maintained constant insurance on your vehicle.

It’s an expensive mistake and one you’re smart to avoid.

The other 48 states require you to carry at least liability insurance, including bodily injury and property damage insurance. While this insurance doesn’t protect you if you’re at fault in an accident, it protects you from damages you have to pay out if you’re deemed at fault — something that also goes on your car insurance history.

Some states, like Massachusetts and New York, also require drivers to hold uninsured/underinsured motorist coverage and personal injury protection (PIP).

How to Get Your Car Insurance History

If you want a copy of your car insurance history to help you determine your possible rate or review it for any inaccuracies, you have two options: 

1. The Comprehensive Loss Underwriting Exchange (C.L.U.E.)
2. Your local Department of Motor Vehicles (DMV)

Both should have the information you need. Here’s a basic overview of each option and how to obtain a copy of your car insurance history.

Comprehensive Loss Underwriting Exchange

Insurance providers will ask for prior proof of insurance when you’re getting a car insurance quote or switching from one company to another. But the insurance industry also shares data through the Comprehensive Loss Underwriting Exchange (C.L.U.E.).

The C.L.U.E. is a claims information report provided by the consumer reporting agency LexisNexis. This report contains seven years of information about your car insurance policies, including:

• Your name
• Date of birth
• Policy number(s)
• The amount the company paid for any claims
• The date and type of any losses
• Description of the covered property (your car and insurance plan — including a history of liability coverage, collision coverage, and comprehensive coverage)
• The property address for homeowner claims or specific vehicle information for auto claims

Thanks to the Fair Credit Reporting Act, you can obtain your C.L.U.E. report once a year, which is of great value whether buying a new car or just shopping around. To get this report, visit the LexisNexis website or call them at 1-866-312-8076.

The DMV

Every state has a different process for obtaining car insurance history, but one of these methods should work:

• Online
• Going to the DMV in person
• Over the phone
• By mail

The amount of time needed to obtain your car insurance history will vary by which option you choose. Just ensure your driver’s license number is on hand to facilitate the process.

Proof of Prior Insurance

Thanks to the C.L.U.E. system, auto insurance companies can tell whether you’ve had lapses and how many claims you’ve filed. When you get a free quote for a new insurance policy, insurers will check the database as part of the process.

If they can’t find this information within the database or you provide inaccurate information, they may ask you for proof of prior insurance. Don’t be alarmed. You may have entered the wrong coverage limits or dates of coverage, which is usually the hold-up. You shouldn’t have any issues as long as you weren’t maliciously trying to alter the dates to show that you had auto coverage when you didn’t.

Insurance or No Insurance, Quotes Are the Key to Lower Rates

Whether you’re driving without insurance, have driven without insurance in the past, or are a responsible policyholder, finding cheap auto insurance isn’t always easy. Nevertheless, you can always find the best rate possible by getting quotes every six months to a year.

Whether your lender requires full coverage on a new car or you just need liability on an old beater, getting quotes is the streamlined way to save — all while keeping your car insurance history spotless.

Eric Schad Insurance Writer

Eric Schad has been an expert content writer for nearly a decade. Before getting behind the keyboard, he worked in the finance and music industries. With eight years of writing experience in the automotive and insurance industries, he enjoys communicating information that makes shopping for car insurance a breeze. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.