There is no hard-and-fast rule concerning how much car insurance goes up after an accident. Whether and how much your car insurance premium goes up after an accident depends on a variety of factors, such as whether you caused the accident, whether the accident resulted in property damage or personal injuries, and even where you live.
If your car insurance goes up after an accident, you might end up paying hefty premiums for years. Asking an insurance representative for help can be iffy. Representatives work for the insurance company, not for you, so they might not have your best interests at heart. A car accident lawyer on your side could explain more and seek damages after a collision.
Will My Car Insurance Go Up if I Caused the Accident?
If you caused a car accident through negligent driving, your car insurance rate will most likely go up when it’s time for renewal. Insurance providers will consider your driving record when determining your insurance premium. If you cause an accident, your rates will go up by a certain percentage. The percent increase varies between providers. In general, this increase will remain in place for three to five years.
Car insurance providers can decline to renew your coverage if you are involved in too many accidents that are your fault, or if you are involved in even one accident that the insurer considers unacceptable. For example, if you cause one accident by driving under the influence of drugs or alcohol, your provider may choose not to renew your policy.
Will My Car Insurance Go Up if I Was Not at Fault?
While you probably expect your car insurance to go up if you caused an accident, you might be surprised to learn that it can increase even if you were not at fault. As noted, whether your car insurance goes up depends on the state where you live, the circumstances surrounding the accident, and which company insures you.
Here’s a hypothetical situation to further demonstrate this concept. Let’s say that an uninsured driver hit you and damaged your car. If you have uninsured motorist insurance, you can file a claim to cover your vehicle repairs. But since you filed a claim with your own insurance company, your rates may increase when your premium comes up for renewal.
This is just one example of how your car insurance can go up even when you were not at fault for the accident. In general, your car insurance will increase more if you caused an accident, rather than an accident you didn’t cause.
Property Damage and Personal Injuries Affect Car Insurance Premiums
How much your car insurance goes up after an accident may depend on the extent of the property damage and personal injuries resulting from the accident. Every accident is different, but broadly speaking, your rates will go up more after an accident that results in personal injuries than one that only results in property damage.
If you are involved in an accident that only damages your vehicle or your vehicle and another driver’s vehicle, then the insurance company may only have to pay for vehicle repairs or replacement. While these expenses can be costly, they are generally limited to the expense of a new car.
In contrast, if you are involved in an accident that results in personal injuries, the expenses can be much greater. Certain injuries, such as traumatic brain injuries, can cost tens of thousands of dollars or more in medical expenses. In these situations, the insurance companies have to pay for that care, and that expense may show up as an increase in your insurance premium.
Can I Avoid an Insurance Increase if I Don’t Report an Accident?
If you caused an accident and can pay for your own repairs or medical bills, you may think it best not to report the accident. After all, if you do not file a claim or report the accident to your insurance company, then your insurance will not go up. Right?
Yet, tempting as this might sound, you should report the car accident to your insurance company, even if it means your insurance will go up.
When you report the accident, your provider will investigate the accident, which can help if the other party makes false allegations against you. Without evidence from an investigation, you may not dispute these allegations and defend yourself. In addition, your insurance company does not have to honor your policy if you do not report the accident. In many instances, it is better to pay the increased insurance rates and have your insurance company behind you.
In some states, you have to report a car accident to the police. For example, Georgia law requires drivers to report any accident that causes an injury, death, or property damage of more than $500. Reporting the accident to the police is another way you can protect yourself from false allegations from the other party in the future.
Car Insurance Laws Vary Between States
In general, car insurance premiums vary between states because insurance laws vary between states. These laws also affect how much your insurance will go up after an accident. Some state laws that affect insurance premiums include laws that require no-fault insurance or personal injury protection insurance.
What Is No-Fault Insurance or Personal Injury Protection Insurance?
Personal injury protection (PIP) insurance, sometimes known as no-fault insurance, is a type of insurance coverage that provides compensation for certain accident-related expenses regardless of which party was at fault. In other words, your own PIP coverage pays for your expenses, even if another party caused your accident.
Depending on the terms of the policy, PIP or no-fault insurance may cover losses from medical expenses, loss of income, household services, and funeral expenses. It does not cover damage to your vehicle or the other party’s vehicle. Typically, PIP coverage only compensates you up to a pre-specified value. Some states require PIP insurance, and it is optional in others.
How Do No-Fault and Personal Injury Protection Insurance Affect Premiums?
If you are hurt in an accident and draw on your PIP insurance to cover your losses, your car insurance may go up. Even if you did not cause the accident, you are using your insurance coverage, which can affect your premium. However, some state laws prohibit an increase in your car insurance rates after using no-fault coverage. A lawyer familiar with the laws in your state can advise you accordingly.
Some Insurance Companies Offer Accident Forgiveness
You may have seen commercials for various car insurance companies advertising their accident forgiveness programs. While the details of these programs may vary from provider to provider, in general, accident forgiveness programs forgive one accident, meaning that your car insurance will not go up after an accident that you cause. Some companies set a time frame for this forgiveness, such as one accident for every three accident-free years.
If you cause an accident, it will still show up on your insurance record, even if your provider forgives you for it. If you shop around for car insurance in the future, other providers can see the accident and may consider it when setting your premium.
Some insurance companies automatically offer accident forgiveness, and with others, it is an optional coverage that will cost you extra. Ask your insurance agent about the details of your coverage if you are unsure whether you have accident forgiveness.
How Do I Know Who Caused the Accident?
It is important to know which party caused the accident. If one party caused a car accident through negligence, they are legally and financially responsible. If you were at fault, you can expect your rates to go up. If not, you can expect them to stay the same or increase slightly. Identifying the at-fault party prepares you to file a car insurance claim or lawsuit to recover damages.
Negligent Drivers May Cause Car Accidents
Negligent drivers are those who put others in danger by disregarding the rules of the road or being careless or reckless in other ways. Negligent driving does not always lead to an accident, but when it does, the negligent driver can hold financial responsibility.
Here are some examples of negligent driving:
- Distracted driving
- Falling asleep at the wheel
- Driving under the influence of drugs or alcohol
- Driving too fast for current weather conditions
- Ignoring traffic signs and signals
- Failing to yield
Negligent Municipalities May Cause Car Accidents
It might surprise you to learn that your state or town can cause a car accident, but it’s true. Municipalities, such as the state, county, city, or town, are in charge of the roads, and if they are negligent in their design and maintenance, they can cause accidents. When that happens, the municipality, not the driver, is at fault.
Here are some examples of negligence by a municipality:
- Crumbling roads
- Excessive potholes
- Uncleared debris in the road
- Uncleared snow or ice
- Obscured traffic signs or signals
- Poorly designed roads or intersections
- Improperly marked roads or intersections
A Lawyer Can Help You After an Accident
If you have questions about your car insurance after an accident, you might think you need to speak with an insurance representative, not a lawyer.
Yet, a lawyer can help you by:
- Investigating your accident: A lawyer can investigate your accident to determine which party was at fault. They will collect evidence such as police reports, pictures of the scene, eyewitness statements, and more.
- Advocating for you with your insurance company: A lawyer can communicate with your insurance company on your behalf. They can use the evidence from their investigation to show that you did not cause the accident and should not face an exorbitant increase in your car insurance premium.
- Advising you: A lawyer can also guide you through the many other legal and insurance aspects of your case, such as seeking damages from the at-fault party’s insurance provider or directly from the at-fault party.
How Can I Get a Lower Rate on My Car Insurance After an Accident?
Even if your insurance goes up after a car accident, you are not doomed to pay sky-high rates forever. Depending on where you live, you may have to pay a higher rate for three to five years, but there are still steps you can take to reduce your car insurance bills in the long run.
- Drive safely: The best way to lower your car insurance is to avoid accidents. If you maintain a clean driving record after the accident, your insurance may go down after a few years.
- Ask about available discounts: Even if your insurance goes up because of the accident, there may be other ways you can lower your premium now. Some insurers offer discounts if you bundle your auto insurance with homeowner’s or renter’s insurance. Others reduce the price if you switch to paperless statements. Ask your provider about available discounts.
- Take a class: You may qualify for a discounted insurance rate if you take a defensive driving or safe driving course.
- Increase your deductible: Most of the time, your insurance will go down if you agree to pay a higher deductible in case of a claim. Only increase your deductible if you can afford it, however, or you may end up with an accident-related bill that you cannot pay.
- Shop around: It never hurts to look around at other insurance providers. If your car insurance goes up after an accident, you should compare your current rates to the rates of other providers. There may be a cheaper option available.
- Drive an older or cheaper car: Your car insurance policy is meant to compensate you for the repair or replacement of your vehicle if it is damaged in an accident. New and fancy cars cost more to repair or replace, so an insurance policy for a newer, fancier car costs more money than a policy for an old, cheap car. If you are not particular about your vehicle, this strategy can be a great way to save money on car insurance.
Consider working with a personal injury lawyer in Atlanta to help you navigate the aftermath of a car accident and negotiate with insurance companies.