As the saying goes, accidents happen. However, when an accident involves your vehicle, the impact can extend far beyond the immediate damage and injuries. Your auto insurance rates are likely to increase, often significantly, following an at-fault accident. The increase you see will depend on several factors, including the severity of the accident, the costs to repair vehicles and property, the number of claims you've made recently, and general rate increases in your state or insurer.
While no one can predict exactly how much your rates might rise, it's important to understand the variables that determine your premiums and take steps to mitigate rate hikes whenever possible. Keeping a clean driving record, increasing your deductibles, bundling multiple policies, and shopping around at renewal are a few of the strategies that can help minimize the impact of an accident on your auto insurance costs going forward. Although an at-fault accident is frustrating, with legal counsel after an accident, focus on safe driving practices and affordable coverage options to get your rates back on track.
The Severity of the Accident Matters
The severity of the accident directly impacts how much your insurance rates will increase. Minor fender benders where only minor damage occurs to the vehicles involved typically result in small premium hikes, if any at all. Major collisions, especially those involving injury, can lead to substantial rate increases.
Insurers view drivers who have caused serious accidents as higher risks to insure. To offset this risk, they will raise premiums significantly, often by 30% or more. Multiple major accidents on your record can lead to rate increases of 50-100% or possibly even make you uninsurable with some companies.
The costs associated with the accident also play a role. If the accident resulted in major medical bills, vehicle repairs or replacement, or other expenses, insurers will pass on some of these costs to you in the form of higher premiums. In some cases, the total costs of claims paid out as a result of an accident can total $50,000 or more for a single driver.
Other factors like whether you were deemed at-fault for the accident and traffic violations issued also weigh heavily on rate increases. Insurers view at-fault accidents and violations as indications of risky driving behavior and will penalize you accordingly. The more at-fault accidents and violations on your record, the higher your rates will climb.
The impact on your rates will diminish over time if you maintain a clean driving record. Most insurers will stop surcharging for accidents after 3 to 5 years. However, some particularly devastating accidents may continue to affect your rates for longer periods. The effects also depend on your state's statutes of limitations regarding the use of claims history in underwriting.
In summary, the severity and costs of an accident, as well as fault and driving record, all determine how much your auto insurance rates may increase. Maintaining a safe driving record and comparing rates from different insurers can help minimize the impact to your premiums over the long run.
Your Driving Record Plays a Role
Your driving record, including any accidents, plays an important role in determining your car insurance rates. Insurance companies view drivers with a history of accidents as higher risk, so they are likely to raise your premiums. The specifics of the increase depend on factors like:
- The severity of the accident. Minor fender benders typically lead to smaller rate hikes than major collisions. Accidents that cause extensive damage or injury are seen as indications of greater risk.
- Who is deemed at fault. If you are found not at fault for the accident, rates may not increase at all or may go up only slightly. At-fault accidents, especially those due to reckless or distracted driving, often result in steeper premium increases.
- Your overall driving history. Drivers with an otherwise clean record of no other accidents or traffic violations in the past 3-5 years may face smaller increases than those with a history of frequent offenses. Insurance companies take your entire driving profile into account.
- The value of claims paid. The more your insurance has to pay out for an accident, especially for things like medical bills or vehicle repairs, the more your rates are likely to rise to offset costs.
- Your policy and coverage details. Rate increases tend to be higher for drivers who carry only minimum required coverage versus those with comprehensive policies. Additional coverage means additional risk and cost for the insurance company.
In summary, the specifics of how much your car insurance rates may increase following an accident depend on various particulars, but you can generally expect to pay significantly higher premiums, especially if you are found at fault. The good news is, as time passes without further incidents, the impact of the accident on your rates will diminish. Continuing to maintain a clean driving record with no other offenses is the best strategy to help lower rates back down.
Location and Type of Vehicle Also Impact Rate Increases
The location where you live and the type of vehicle you drive can also impact how much your rates increase after an accident. Insurance companies use complex algorithms to determine rates based on the likelihood of claims in your area and costs to repair or replace your specific vehicle model.
Location
Insurance rates vary significantly based on location. If you live in an area with high accident and claim rates, your premiums will likely increase more after an accident versus someone in a location with lower claim frequencies. The costs to settle claims also differ in different locations based on factors like local labor and materials expenses.
Vehicle
The make, model, and year of your vehicle play a large role in determining rate hikes after a collision. Luxury, high-performance, and new model vehicles typically cost more to insure and will see larger rate increases compared to older, standard models. The more expensive the vehicle is to repair or replace, the higher the rate increase will be to offset costs for the insurance provider.
In summary, drivers should expect to see varying rate increases after an accident based on individual risk factors like location and vehicle details. While rate hikes after a claim are often unavoidable, you may be able to find savings by comparing quotes from different companies, increasing your deductibles, or bundling multiple policies. The impact on your premiums will lessen over time if you maintain a clean driving record going forward.
You May Be Able to Minimize Rate Hikes
There are a few steps you can take to potentially minimize insurance rate increases after an at-fault accident.
File an Accident Forgiveness Claim
If your insurance company offers an accident forgiveness program and you have been a customer for a certain period of time with no other claims, you may be able to file for accident forgiveness. This means the accident will not count against you when determining your rates at renewal. However, there may be certain stipulations, such as the cost of damages not exceeding a certain amount. It is best to check with your insurance provider for the details of their accident forgiveness policy.
Increase Your Deductibles
Raising your deductibles, the amount you have to pay out of pocket before your insurance kicks in, can help offset rate hikes. The higher your deductibles, the lower your premiums. This is because the insurance company is taking on less risk. Ask your agent how much you can save by increasing your deductibles for both comprehensive and collision coverage. Make sure any new deductible amounts still fit your budget in the event of another accident.
Improve Your Credit Score
In many states, insurance companies consider your credit score when determining premiums. Improving your score over time may help lower your rates. Pay down high-interest debts, limit new applications for credit, and check your credit report for any errors. Even small score improvements can potentially save you money on your premiums.
Consider Dropping Comprehensive and Collision Coverage
If your vehicle is older, comprehensive and collision coverage may be costing you more than the vehicle is worth. Dropping these coverages will significantly lower your premium, but you have to be willing to take on the risk of paying for repairs or the full cost of replacing your vehicle if it is damaged or totaled in an accident. Run the numbers to see if dropping coverage makes sense for your situation.
Taking these steps and maintaining a safe driving record with no further accidents or traffic violations can help minimize the impact of a single at-fault accident on your auto insurance rates over the long run. With time and a clean record, your rates should start to lower again.
Shop Around at Different Companies
Once you have been in an accident, your insurance rates are likely to increase. Insurance companies view those with a recent accident as higher risk, so they will raise your premiums to compensate. The increase can vary depending on the severity of the accident, who is found at fault, your prior driving record, and other factors.
To minimize how much your rates go up, shop around at different insurance companies. Some companies may view the accident as less serious than others, or may be more forgiving of one accident on an otherwise clean record. Compare quotes from multiple insurers to see which offers the most affordable coverage. You may find lower rates from companies like Progressive, Geico or Liberty Mutual.
When shopping for new insurance, be upfront about the accident. Hiding the details of the collision to get a lower quote is considered fraud and can result in legal consequences. Inform agents of the accident date, who was found at fault, the amount of damage, any traffic citations issued, and whether or not medical attention was needed. Provide as much information as possible so the insurance company can properly assess your risk and offer an accurate premium.
Shopping around at different companies after an accident is one of the best ways to minimize a rate increase. By comparing quotes from multiple insurers, you have a better chance of finding one that views your accident less harshly, or that specializes in providing coverage to higher-risk drivers. Do not hesitate to switch companies if you find a substantially lower rate. Over time, as you continue your safe driving record, your rates should start to decrease again.
Call Fletcher Law For Help With Your Car Accident
If you’ve been in a car accident, your insurance rates may increase. Insurance companies view drivers who have been in accidents as higher risk, so they often raise rates to compensate. The increase can vary depending on the severity of the accident, who was at fault, your location, driving record, and other factors.
Call Fletcher Law For Help
After an accident, it’s important to contact your insurance provider as soon as possible. However, you should also call an experienced car accident lawyer to help you navigate the claims process. At Fletcher Law, our legal team has helped thousands of clients deal with insurance companies after an accident. We can advise you on steps to take to potentially minimize a rate increase and ensure you receive fair compensation for your injuries or vehicle damage.
Some key things we may recommend include:
- Do not admit fault at the scene. What you say can be used against you later.
- Get a copy of the police report as soon as possible. Review it for any errors and notify the police if needed.
- Get an estimate of the damage to your vehicle in writing from an auto body shop. Provide this to your insurance company.
- See a doctor, even if you feel fine. Some injuries may not surface for days or weeks. Medical records can support your injury claims.
- Do not settle with the insurance company right away. They may offer you less than you deserve at first. We can help negotiate a fair settlement amount.
- Consider filing a personal injury lawsuit against the at-fault driver. Lawsuits often lead to higher settlement amounts that can help cover increased premiums, medical bills, lost wages, and other expenses.
The car accident attorneys at Fletcher Law have decades of experience helping clients in situations like yours. Call us today for a free case review and to discuss strategies to mitigate the impact of higher insurance rates resulting from your accident. We're here to help you get the fair outcome you deserve.