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How do penalty points affect car insurance?

From speeding to driving an uninsured vehicle, there are numerous ways you could break the law when you’re behind the wheel. 

If you’re convicted, you will acquire penalty points on your licence. The more serious the offence, the more points you’ll get, and if you collect more than a certain number within a set timeframe you may be banned from driving altogether. Worse still, acquiring penalty points on your licence can also cost you when it comes to renewing your motor insurance. 

Forewarned is forearmed, so in this article we’ll bring you up to speed on how the system works, the various offences to be aware of, and the implications of endorsements for your purchase plans and insurance premiums. 

What are penalty points and how long do they stay on my licence?

If you break the law when you’re driving, there are two different outcomes depending on the seriousness and complexity of the offence. Both, however, can mean penalty points being added to your licence. 

For relatively minor offences you may get a fine known as a fixed penalty notice (FPN) – for example, if you’re caught speeding on camera, not wearing a seatbelt, or using a mobile phone whilst driving. 

For more serious breaches you may be summoned to the magistrates’ court. If you’re found guilty you’ll usually be fined and receive penalty points too.

How long will the penalty points stay on my licence?

Points are attached to your licence record on the national database for a limited period; 4-years in most cases, but 11-years for serious offences such as drink and drug-related driving offences. 

The penalty points are ‘valid’ for the first three years of a 4-year endorsement and the first 10-years of an 11-year endorsement. During the ‘valid’ period, a court can take them into account if you breach the law again. 

Insurers (and others such as employers) may be able to establish that you have points on your licence at any time during a 4-year endorsement, or for the first 5-years of an 11-year endorsement.

The different types of offences and how many points will they give you

There are numerous categories and types of conviction, each with its own endorsement code and a set range of penalty points between 1 and 11. More serious offences - those involving injury or death in particular – attract more points. 

The full list of endorsements, together with penalty points and whether they run for 4 or 11 years, can be found on the gov.uk website, but they include:

  • Speeding: The most common offence, speeding can add 3-6 points on your licence.
  • Accident offences: For example, failing to stop after an accident can get you 5-10 penalty points.
  • Disqualified driver offences: These can get you 3-11 points.
  • Careless driving: Will lead to 3-9 points or up to 11 points if you caused death through careless driving.
  • Construction and use offences: For instance, driving a vehicle with defective brakes can lead to 3-6 points on licence. 
  • Reckless/dangerous driving: Will get you 3-11 points. 
  • Drink driving and drug offences, including failure to cooperate: Will lead to 3-11 points being put on your licence.
  • Insurance offences: Driving an uninsured vehicle can put 6-8 points on licence.

How many points until my licence gets taken away?

If you build up 12 penalty points on your licence within 3-years, you can be disqualified from driving for a set period. Bans last 6-months if you’re awarded 12 or more penalty points over a 3-year period. If you get a second ban within 3-years, you’ll be disqualified for a year, and if you get a third ban within 3-years, you’ll be off the road for 2 years. 

When the disqualification period is up, you will have to apply for a new driving licence before you can get back behind the wheel. If the court requires it, you may also have to take another driving test. 

New drivers are under a stricter regime. If you receive 6 or more points on your licence within 2-years of passing your test, you’ll lose your licence altogether. You’ll then need to apply, pay and pass new theory and practical driving tests to get it back.

How do I know how many points I have?

It’s easy enough to establish the state of your licence and check what points and disqualifications you have through UK government service.

To access this information you will need your driving licence number and the postcode shown on it, plus your national insurance number to log in. When the points on your licence expire, they’ll normally be automatically removed. 

Does having points on my licence affect my ability to get a car on finance?

There’s no hard and fast industry guidance on this. According to the Finance & Leasing Association, all lenders will check customers’ credit ratings when considering requests for motor finance, but consideration of penalty points varies from one firm to another. “It’s not something we collect data on,” says a spokesperson

At PSA Finance, having points on your licence will not affect your eligibility for our car finance packages. However, it may affect your access to insurance policies linked to the finance, such as Just Add Fuel or PCP Plus.

How do penalty points affect my motor insurance?

Most motor insurers will request details of all driving convictions you’ve accumulated over the past 5-years. But be warned, even a single conviction involving penalty points is likely to push up your motor insurance premiums. 

This is because insurers’ data shows people with points and motoring offences in the last 5-years are more likely to be involved with driving incidents and more likely to make subsequent claims.

In keeping with the penalty points system itself, more serious offences will make a bigger difference to your premiums. For instance, your premium is likely to be more affected if you’ve collected points for seriously injuring someone through dangerous driving than if you’ve been penalised for driving a car with too many passengers in it. 

Why you should declare your penalty points when you renew your insurance

It is very important to understand that you have a legal obligation to tell your insurer if you receive penalty points, though your premium should not be affected until the policy is renewed.

You must also declare your penalty points if you decide to take out a new policy with another insurer at renewal time. 

If you don’t mention your points, your policy could be deemed invalid. That would not only mean you were without cover if you then had an accident, but also leave you at risk of committing the further offence of driving an uninsured vehicle.

Mobility Pass

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How much can penalty points affect an insurance premium?

Researchshows that a 3-point conviction – the typical penalty for speeding – for those with no previous points boosts premiums by an average 16%, equating to £160. 6 points on a previously clean licence can push premiums up by 30% or £552 on average.

Is there any way I can reduce my insurance premium if I have points on my licence?

While the best course of action is clearly to avoid accruing points in the first place by driving sensibly, there are measures you can take to help contain motor insurance premiums when you have points on your licence. 

For a start, it’s best to be honest and upfront about any incidents you’ve been involved in. Communicate with your insurance provider about the accident and how you acquired the points. This may be taken into consideration when you next renew. 

When it comes to renewal time, do shop around using the insurance comparison sites available. In addition, it may be possible to reduce your overall premium further by opting for a higher voluntary excess. 

Installing a black box can help lower your premiums

Consider installing a black box telematics recorder. These are installed in your car by the insurer, and when activated they enable the company to collect data about your driving habits and quality. 

They’re likely to look at information on factors such as your braking, cornering, steering and speed, the amount of time you spend behind the wheel and your mileage. That information is then used to adjust your premiums. Some insurers will make monthly adjustments while others work on an annual basis. 

Whether you’re worried about getting insurance with existing points on your licence, or simply trying to find out more about the implications of a driving conviction, make sure you’ve got appropriate motor insurance for your circumstances. 

Find the right insurance policy for you

PSA Finance offers a range of insurance policies designed specifically for Citroën, Peugeot and DS Automobile drivers, so you can pick the perfect insurance policy to suit you. You can find out more by taking a closer look at our car insurance products today.