What is Driver Grade?
The main driver’s age and loss history is a major factor in calculating your car insurance premium.
Key takeaways
- Driver Grade is the system initio uses to assess the main driver’s claims history when calculating vehicle insurance premiums.
- Driver Grade is based on the number of at-fault claims made by the main driver during the previous five years.
- At each annual renewal, Driver Grade is recalculated by removing claims older than five years and adding any new initio at-fault claims from the past year.
- A Driver Grade of zero means the main driver has had no at-fault claims in the previous five years and receives the lowest Driver Grade premium.
- Each additional at-fault claim increases the Driver Grade and may increase the insurance premium.
- Claims where another party is responsible are not counted towards Driver Grade. However, some claims where no responsible third party can be identified, such as vandalism, may still be treated as at-fault for Driver Grade purposes.
- When applying for cover, customers are asked to disclose claims where they or the owner paid the excess, as this helps identify claims that could not be recovered from another party.
When you get a quote from us we ask about the number of claims you’ve had in the last five years, where you or the owner paid the excess.
Each anniversary, when your policy renews, the initio system checks to see what additional initio claims the Main Driver has had during the year. The system also checks to see if historical claims have fallen outside of the five year period.
We call this ‘Driver Grade’. Other providers have a similar system referred to as “No Claims Bonus”.
How does Driver Grade work?
When the policy is first started we take the claims from the main driver’s previous 5 year period. This number determines the driver grade, and has a bearing on the car insurance premium.
When the policy anniversary comes around we re-calculate the driver grade by checking if some of those historical claims have fallen outside the 5 year period, and checking to see if the main driver has incurred any initio at fault claims during the past year.
The number of ‘at fault’ claims in the previous 5 year period determines the driver grade.
- Had no claims? Your driver grade is zero and you’ll be at our lowest driver grade premium without any loading.
- If you’ve had a claim, the grade increases to one which slightly increases the premium.
Each additional at fault claim increases the driver grade and premium. If you’ve had 3 at fault claims your driver grade is 3, and premium will be significantly higher than a vehicle that has a main driver with no claims.
We don’t count at fault accidents that are more than five years ago. A crash 10 years ago won’t affect the premium you pay today. We also don’t count claims where the main driver was not at fault. But know that the main driver can still be considered ‘at fault’ even if it wasn’t directly their fault (e.g the vehicle was vandalised).
What if I wasn’t at fault, but I paid an excess?
When starting cover with us we ask you to disclose claims where you paid the excess. This is the best way to determine what claims are not recoverable by your insurer (ie where another party cannot be made responsible).
We realise that you could have a claim go towards your driver grade that wasn’t really your fault (like your car being vandalised), but this is still considered at fault as we (or your insurer at the time) is not able to hold another party responsible for the damage.
Think of it as a user-pays system where those that claim more (with no ability to hold someone else responsible for the cost) pay a bit more into the claims pot.
Frequently asked questions
What is Driver Grade?
Driver Grade is initio’s way of measuring the main driver’s at-fault claims history over the previous five years. It helps determine the premium for your vehicle insurance.
How is Driver Grade calculated?
Driver Grade is based on the number of at-fault claims the main driver has had during the previous five years. Your Driver Grade is reviewed each time your policy renews.
Related Articles:
- Initio’s vehicle claim basics
- Am I still insured if I crash without a warrant?
- How do I buy my first vehicle policy with initio?
- How does claims grade and knock-for-knock work?
Written by Megan Fisher. Initio’s Head of Marketing
Megan has been with initio since 2022 and creates customer-focused content that helps New Zealand homeowners and landlords understand insurance in plain English. She works closely with initio’s claims, customer support, and development teams to make sure content is accurate, useful, and easy to follow. She has more than 20 years of experience in marketing and product strategy.