Shuman Roy is an entrepreneur, business owner, and musician. He started RoysNoys, LLC in 2013 as a music production and education service company. He also offers small business consulting and advisory services to help businesses get from start-up mode to turn-key operations. Shuman earned his M.B.A from the Stern School of Business in 2001 and has an undergraduate degree from Manhattan College in ...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Joel...

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Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Oct 25, 2021

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There are many reports utilized by insurance companies to determine what to charge you for your car insurance coverage.

They include motor vehicle history reports, MVR (motor vehicle record/personal driving record), C.L.U.E. and financial responsibility reports.

Your “vehicle history report” is a record of the following:

  • Previous accidents
  • Car title issues
  • Number of previous owners
  • Service records
  • And more

Table of Contents

Your MVR – Driving History Report is similar to a driving record that keeps track of everything such as traffic ticket, traffic violations, accident reports, DUI convictions, driver’s license points, vehicle-related crimes, etc. The motor vehicle report also includes driver license details (driver’s license class, license suspension, license expiration, endorsements, and personal information). 

You can visit the local Department of Motor Vehicles to get a copy of your motor vehicle report, however if you’re applying for an insurance policy, the insurer will contact the DMV themselves to get a copy. 

An MVR background screening process is a report of a person’s driving history and is similar to other screenings such as criminal background checks. The purpose of the motor vehicle report is to determine whether the applicant is a safe driver. 

Who is the leading provider of a driver history report?

You may recognize the name CARFAX; they are one of the leading vehicle or driver history report providers.

So how can this information possibly affect your car insurance rate?

Insurers attempt to predict future losses, or insurance claims they will have to pay, using any information possible.

Ultimately, if any data point, or piece of information collected about a person or type of vehicle demonstrates tendencies toward an increase in claims frequency or severity, an insurer will charge that person or the vehicle owner more for coverage.

A driver history report reveals that drivers who own vehicles involved in previous serious accidents tend to file more claims than those who own vehicles with no previously reported serious damage.

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Will data in the reports raise or lower your auto insurance premium?

It may be that drivers who cannot afford to repair their vehicles out-of-pocket file more claims for damage repairs, or that they tend to be more accident prone in general.

The data doesn’t provide a definitive answer; it only proves that there is a correlation between previous accidents and future claims filed.

This may sound like another negative, but in reality, it lowers rates for those of us who don’t fit those categories identified as having more claims.

The insurance company’s goal is to charge the least amount possible to those who have the fewest overall claims and vice versa.

Essentially, those who file more claims are charged more.

However, insurance companies cannot simply make up rates or false rating factors.

Each state has a department of insurance that governs what insurance companies can charge for insurance.

The insurer has to prove the information they use to calculate their rates is legitimate.