The auto insurance industry is challenging to navigate in even the simplest of situations. Add into that a disability, auto modifications or expensive medical equipment and it makes finding the right policy stressful.
Luckily, as with most insurance situations, being honest and upfront with your agent and insurer from the get-go is the best way to handle it.
Let's take a look at what you need to do to insure your vehicle if you're disabled. The first thing to do is look at how insurers set auto rates.
How auto insurers set rates
Although there's no gold standard on how auto insurers set rates, there are a handful of factors that typically go into their decision.
The factors include:
- Type of car
- Cost of vehicle
- Size of car
- Theft history of the type of vehicle
- Driving record
- Driving experience
- Annual mileage
- Credit history
Some risks are easier to assess than others. Statistics show young, male, teen drivers to be riskier than almost all other categories. The fatal crash rate per mile driven for 16- to 19-year-olds is nearly three times the rate for drivers over 20. Of those fatalities, the number of males versus females is almost double. This puts them in a higher rate slot, which leads to higher rates.
But keep in mind that each auto insurer's underwriting department has a different set of rules when they're setting prices.
Insurers can’t discriminate
In addition to these general factors, those who are disabled need to consider additional conditions. Those conditions include vehicle modifications and medical equipment on board.
Bill Fertig, director of the Spinal Cord Injury Resource Center, said that insurance companies can’t directly discriminate based on your physical abilities.
"You can have some agent make a personal judgment and never say anything and you'd never know it, but you cannot have any discrimination from insurers based on people having a disability of any kind, so I don't consider that a problem," he said. "But it's very important to be upfront with your insurance agent about what exactly you have and how much your cost was," he said.
An example: If you drive a generic car and just modify it by adding simple hand controls. The controls could cost $1,000 and your car might be valued at $4,000. If something happened, such as a crash, you would want to be compensated for not only the car’s value but also the tool’s value. In this example, the hand controls.
"The way they do that is they apply a rider -- just an additional little insurance product to your account to cover your hand controls,” Fertig said.
You wouldn’t want to have to replace the hand controls out of your own pocket. However, $1,000 to do that would be nothing compared to someone who has a modified van with sophisticated controls, such as a Scott Driving System. Those go for $100,000 and up.
So if you add those to a $30,000 minivan, and get into a crash, you don't want to just get the minivan replaced for $30,000, you want to get the entire vehicle replaced for $130,000. It's another case of being upfront about what you're insuring and how much it costs to replace.
Covering medical equipment in your vehicle
Fertig said insurance companies usually cover wheelchairs and other equipment damaged in a crash.
“However, just as in the case of a vehicle that has been modified with after-market wheelchair accessibility equipment, it's much better to have a pointed discussion with your auto insurance agent at the time of initiation of the policy about the additions, possible ramifications of the chair damage and cost, etc. Then, a rider can be written to accommodate that exact need and the policy language can be agreed to up front. This will allow for a much quicker and more seamless coverage and repair process in the event of an accident,” Fertig said.
Can insurers force a disabled driver to switch to modified controls? The quick answer is no. According to Fertig, only your state department of motor vehicles can do that.
"The insurance doesn't do that, you just need to have a discussion with your insurer. Your state has licensing regulations and it's different from state to state," he said.
Twenty years ago when Fertig was injured, there was no additional training required. He purchased a pair of portable hand controls, kept them on his car and went to take his drivers test at the local DMV.
Fertig recalled that the examiner didn’t care about the hand controls. The examiner saw hand controls the same as any other vehicle. However, "many states require you to go through a laborious and expensive and time-consuming process of having professional driver training for using hand controls," he explained.
The only difference between his license after his injury and his license before is that he now has a restriction on it saying he needs to use the special controls. He likened it to those who wear glasses and have a restriction listed on their license. Insurers have access to that information. They can’t see who has a handicapped placard, though.
Another possible area for discrimination against disabled drivers could lie with rate increases. But Fertig was adamant that this practice is illegal.
"Disability-related insurance rate increases are clearly discriminatory. If you have an accident, or two, and you have your rates raised due to your driving record, you may have your rates raised. I would argue that any attempt to raise one's auto insurance rates based solely upon the fact that the driver has a disability should and would be met with an immediate civil lawsuit," said Fertig.
What level of auto insurance coverage do you need?
Fertig said a new high-priced vehicle needs collision coverage on top of the liability coverage.
"With a new vehicle, especially something with a base value of $30,000, then $20,000 more in vehicle adaptations, yes, you must insure against the loss of the $50,000 by purchasing collision,” Fertig said.
The bottom line, as with most things in life, is to be open and honest from the beginning, so there are no surprises on either side of the aisle.
Find out more about other types of insurance and disabilities: