Learning from Lohan

I regularly tell friends there’s always an insurance angle, no matter the event. And so it is with Lindsay Lohan’s┬álatest fall from grace.

As Lohan’s jail time continues to fuel the news headlines, our colleagues at the Insurance Information Network of California (IINC) remind us that we can learn from Lohan’s mistakes, at least from the insurance perspective.

As reported by Insurance Journal, IINC has determined the average insurance premium difference Lohan could pay for auto insurance because of her risky behavior based on her profile, ZIP code, vehicle model and current record of two DUIs and an at-fault car accident.

A single, 24-year-old female who lives in the Beverly Hills ZIP code of 90210 (Lohan lives in a condo in West Hollywood) and drives a 2009 Mercedes SL550 convertible would have access to 100 percent of the insurers offering auto coverage in California, according to IINC.

With a clean driving record, Lohan would pay approximately $2,075 every six months for a full coverage policy. But with an at-fault accident and two DUIs on her driving record, the six month premium would more than triple to $7,408.90.

That’s an annual premium of nearly $15,000.

Lohan would also only have access to less than 10 percent of the companies in California offering auto coverage, because most of the major insurers in the state would consider her too great a risk. IINC says it’s likely she would have to purchase coverage for bad drivers through the Department of Insurance.

I.I.I. research indicates the average American driver spends about $850 a year on auto insurance. The better your driving record, the lower your premium.

IINC’s Pete Moraga sums up the situation:

“If we take risks and make bad decisions, our insurance will be much more expensive.”

Check out this I.I.I. video offering five tips on saving money on auto insurance.

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