Accidents never have a positive impact on your car insurance rate, but they do not always increase after an accident, either. Whether your car insurance increases and the amount it could go up after an accident depends on several factors. Depending on which source you consult, the average premium increase after a car accident ranges from 35 to 55 percent, which makes it difficult to predict an exact amount.
Below, we take a closer look at how accidents impact car insurance rates, specific situations that won’t result in a rate increase, how long you might have to deal with an increase in premiums, and some tips you can follow to help reduce your rates in the wake of a car accident.
Factors That Affect Your Insurance Premiums After a Car Accident
Each car accident has underlying facts and circumstances that potentially impact the amount you have to pay for car insurance after the accident. Factors that could lead to a temporary increase in your car insurance premiums include:
If you did not cause the car accident, you will likely see a minimum increase in your car insurance rates, if any at all. In most cases, drivers who cause accidents can expect an increase in their premiums. Once you file an insurance claim, the assigned insurance adjuster will assess the damage, review the police report, conduct interviews, and determine liability for the accident. If the accident involves more than one liable party, multiple drivers could bear liability for an accident.
No-Fault Insurance in Virginia. Virginia does not require drivers to carry no-fault insurance, like some other states. However, vehicle owners can choose to purchase optional no-fault coverage that pays benefits for medical expenses and lost wages related to accident injuries. If you have opted to purchase no-fault insurance, and you file a claim, it typically will not impact your premiums, even if you caused the accident. However, you should double-check with your insurance provider when you purchase no-fault coverage.
Amount of Your Claim
As a general rule of thumb, the higher the value of your insurance claim, the more likely your car insurance premiums will rise. Additionally, the amount that your premiums increase also depends on the amount of your claim. The way the amount of your claim impacts your insurance premiums speaks to the idea that insurance providers view fender-benders differently than severe accidents that total a vehicle.
Number of Previous Claims
Many of the largest car insurance providers in the United States offer one “freebie,” typically referred to as accident forgiveness. Auto insurance carriers who offer accident forgiveness allow policyholders to file one accident claim without facing an increase in their premiums, even if they caused the accident. You should check your policy or consult with your insurance agent or provider to find out if you have accident forgiveness. You may not have to worry about your insurance going up.
If you have filed a claim within the past three to five years, your auto insurance premiums likely will increase. Insurance providers also frequently increase the premiums by a greater percentage with each subsequent accident. Once providers deem you too costly of a risk to cover, you do not need to worry about how much your insurance goes up after an accident, because your carrier will likely cancel your policy or refuse to renew your policy.
Auto insurance providers review driving records to determine rates for new policyholders. Each time policyholders receive a citation for a moving violation, they risk increased premiums when they renew their policies. If you received a citation for speeding, inattentive driving, drunk driving, reckless driving, or another moving violation related to your car accident, your car insurance will likely go up.
Accident Situations That Do Not Increase Car Insurance Premiums
Above, we discussed factors that could make your car insurance go up after an accident, but several situations likely won’t lead to an increase in your rates for coverage.
These situations include:
- Your car sustained damage while legally parked.
- You received reimbursement from the driver responsible for the accident, directly or through an attorney.
- Another vehicle struck the rear of your car, and you did not receive a citation related to the accident.
- A hit-and-run driver struck your vehicle, and you reported it to law enforcement immediately.
- The other driver received a citation for a moving violation, and you did not receive any citation.
- The car accident occurred because of a bird, animal, or falling object.
An Increase in Car Insurance Premiums Lasts for Years
If your car insurance goes up after an accident, you likely will have to pay the increased rates for at least three years. In some cases, a minor claim might not impact you for quite as long. In other cases, severe accidents can stay with you for more than three years. If your rates increase, the exact time you face increased premiums will depend on your carrier.
Coping With Increased Insurance Premiums After a Car Accident
If you suspect your insurance rates will increase because you suffered injuries and property damage in a car accident, you may successfully counter the increase if you:
- Investigate the discounts your insurance provider offers for good students, multiple policies, and other potential savings.
- Increase your deductible to lower your auto insurance premiums.
- Reduce your coverage to the minimum amount required by Virginia law.
- Request quotes from other carriers to find better rates.
Car accidents often prove costly and can impact your insurance premiums even when you did not cause the accident. If you suffered injuries, you may qualify to receive compensation for damages. Virginia law permits you to sue an at-fault driver for damages, often done with the help of an experienced car accident lawyer. If you prevail in your claim, you could receive compensation that can help cover additional insurance expenses. Reach out to an attorney today to schedule a free case evaluation, during which you can discuss the details of your car accident and determine your best options going forward.