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How Car Accidents Affect Your Insurance
09/14/2020
How do car accidents affect my insurance policy?
If you’ve been in an auto accident, you’re probably wondering how it will affect your insurance. The first thing to consider is who was at fault. Your insurance premium will not increase if you weren’t responsible for the accident. However, the at-fault driver’s car insurance will be affected.
While every car insurance provider differs in how they handle their customers following a car accident, several general factors determine how long the accident stays on your record, how much your premium is going to increase, and how to get your insurance to go back down if it does rise.
Here’s how a car accident affects your insurance if you were at-fault:
How Long a Car Accident Stays on Your Record
On average, a car accident can affect your insurance premium for three to five years. The violations associated with the incident, along with the state you live in, will play a factor in determining when the accident will disappear from your record.
How Much Your Car Insurance Premium Increases After an Accident
Car insurance premiums can increase anywhere from 3%-110%, depending on the type of claim you make. According to a NerdWallet analysis, car insurance rates can go up almost 50% a year on average — around $688 — if you cause an accident with $10,000 in damage.
Some of the factors that determine how much your premium increases after an auto accident, include:
- Your insurer
- Who was at fault
- The state where you live
- Prior accidents or moving violations
- Your age
- The amount of damage
If you are not at fault or if it’s the first time you’ve been involved in an accident and have a clean driver’s record, your premium may not increase. Your insurance company and adjuster will assess the damage, look at photos from the accident, and talk to witnesses to determine who is at-fault. Additionally, if you use the medical benefits of your coverage or pursue a claim against your own insurance company for Underinsured (UIM) or Uninsured (UM) benefits, your rates will not go up.
In Pennsylvania, there is an average 53% increase to your accident-free rate after an at-fault accident, according to NerdWallet. Typically, the rates in PA before an accident are $1,167 on average and raise to $1,780 after an accident. However, your car insurance company will play a huge role in how much—if at all—your premium will increase since each company’s viewpoints about raising insurance after an accident vary.
How to Decrease Your Insurance After an Accident
Dealing with the aftermath of a car accident can be stressful, but there are measures you can take to reduce your insurance after it increases.
- Talk to your adjuster about accident forgiveness. If your car insurance provider offers accident forgiveness, you may be able to reduce any increases in your insurance premium.
- Research discounts. Sometimes drivers can qualify for discounts on their insurance if they’re a long-term customer, drive less than a certain number of miles per year, have good grades (if they’re a student), work in certain occupations, or are a member of specific professional organizations.
- Improve credit. Many car insurance providers look at your credit history when calculating your premiums. If you can raise your credit score, you may be able to reduce your rate.
- Increase deductible. Determine how much you can comfortably pay out-of-pocket in the event you have to file a claim. You may be able to increase the deductible and save on your premium that way.
- Lower coverage. Go over your current policy and see if you’re paying for coverage you may not need. Pay attention to your collision, comprehensive, and rental car coverage.
- Shop around. Call other insurance providers to go over your history and see what their current rates are. Even though you’ve been in an accident, you may be able to find a lower premium elsewhere.
- Bundle your policies. Some insurance providers will give additional savings to policyholders that bundle their home and auto policies with them.
When Should I Call an Attorney?
Hiring car accident lawyers after a car accident can help you prove that you weren’t responsible and save you money down the line. Experienced attorneys gather the evidence and information they need to prove you were not at-fault and work to get you the best possible settlement.
