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How your driving record may be affecting more than just your car insurance

Those individuals with a somewhat checkered driving record are all too aware of how the mistakes of the past — accidents, speeding violations, DUIs — can come back to haunt them when it comes to car insurance. Indeed, the unfortunate reality is that their momentary lapse in judgment behind the wheel more often than not results in a lifetime of elevated premiums.

While the fallout from a less than stellar driving history has long been confined to the area of auto insurance, drivers should be aware that recent reports show that is now changing thanks to the power of predictive analytics.

Unbeknownst to the majority of people, life insurance companies have become increasingly reliant on the use of driving histories when examining prospective policyholders — regardless of the amount of coverage sought or the age of the applicant.

As to why life insurance companies would have any interest in this information, experts indicate that it provides invaluable insight into how an applicant behaves on an everyday basis, their approach to risk management and even when they might pass away.

Furthermore, they indicate that when an applicant is in their 20s, 30s or 40s, there is a very good chance that they don’t have an incredibly extensive medical record from which to draw definitive conclusions, and driving records can help fill this informational void.

All of this naturally raises the question, however, as to whether driving records really are an effective barometer of mortality.

Interestingly enough, a data analytics firm and insurance company recently joined forces to conduct a study in which they analyzed the driving records of 7.4 million people from 2006 to 2010, and cross-referenced this data pool with fatality records covering the same timeframe, which revealed that 73,000 of these drivers had died.

Careful examination of the data revealed the following:

  • Those with six-plus traffic violations on their driving record increased the fatality rate by 79 percent.
  • Those with major violations on their records — speeding 30 miles-per-hour over the speed limit, DUIs, etc. — had a fatality rate that was 71 percent higher than their counterparts with only minor violations or clean driving records.
  • Those men with one serious traffic violation on their record saw their fatality rate increase by 61 percent, while those women with one serious violation on their record saw their fatality rate increase by 50 percent.
  • These trends were consistent across all age groups.

It’s certainly surprising to see how innovative insurance companies have become in assessing risk. Indeed, it will be interesting to see what other factors they begin using to further strengthen their crystal ball. In the meantime, here’s yet another reason to drive safely.

Source: USA Today, “Your driving record: Insurance companies’ crystal ball,” Barbara Marquand, Jan. 13, 2017

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