How Much Does Car Insurance Go Up After an Accident?

What Factors Can Impact My Premiums After a Claim?  

Auto insurance is mandatory in most states, and many policyholders want to understand what affects their premiums after a claim. Several important factors determine how much your rate may increase:

• Fault: If you’re at fault in an accident, your premium usually goes up.
• Claim Severity: Larger or more expensive claims often lead to bigger rate increases.
• Driving Record: A clean record can lessen the impact, but multiple claims or violations can raise your rates significantly.
• Location: Rates vary by state and city due to different risks, repair costs, and insurance regulations. Florida, for example, is one of the most expensive states for auto insurance.
• Risk Pool: Insurers evaluate the overall risk of the group of drivers you’re grouped with, which can influence your rate after a claim.
• Policy Type: Full coverage car insurance policies typically see higher increases than minimum coverage after an accident.
• Age and Experience: Younger and less experienced drivers often face larger increases because insurers view them as higher-risk.

Can I Prevent My Car Insurance Rate from Increasing After an Accident? 

Yes, there are steps you can take to prevent your car insurance rate from increasing after an accident. One option is to ask your insurer about accident forgiveness, a feature some companies offer that can prevent your first at-fault accident from affecting your premiums.

Other ways to help manage your rates include:

• Maintaining a clean driving record and practicing safe driving habits.
• Taking a defensive driving course, which could qualify you for a discount. Reporting the accident promptly and cooperating fully with your insurer.
• Raising your deductible to help lower your premiums.
• Always shopping around for the best rates by comparing quotes from multiple insurers.

Pro Tips: To manage your insurance costs effectively, take as little risk as possible and be a responsible driver.

Learn more: When does car insurance go down?

What Is Accident Forgiveness and How Can It Help? 

Accident forgiveness is a feature some insurers offer to protect you from a rate increase after your first at-fault accident. When this applies, the insurer won’t count the accident against your driving record, which means your premium stays the same.

Most companies require a clean driving history to qualify, but some may include it automatically, while others charge extra as an add-on. It’s a helpful tool because a single accident can cause a major jump in your rates. With accident forgiveness, you can avoid that spike and manage your insurance costs more confidently.

If you’re unsure whether you have it, ask your insurer or your local agent to review your policy.

How Do I Lower My Insurance Cost After an Accident? 

If you need to file a claim on your auto policy, you might be wondering how to lower your insurance costs after an accident. Here are some effective strategies:

• Switch Insurers: Consider switching to a different insurance company to find potentially cheaper rates. Many experts suggest this can save you money, especially after an accident.
• Update Your Coverage: Adjust the limits and terms of your auto insurance policy. For example, raising your car insurance deductible can lower your premiums. For instance, if you have an old or low-end vehicle, you can drop collision insurance to lower your premium. But be careful not to lower your coverage too much and make sure to always maintain state minimum liability auto coverage.
• Take a Driving Course: Completing a defensive driving or driver education course may help you qualify for discounts, particularly if you're a younger or older driver.
• Ask About Accident Forgiveness: Some insurers offer accident forgiveness programs. If you qualify, this can prevent a rate hike after your first accident.
• Improve Your Credit Score: Paying bills on time and reducing debt can help improve your credit score, which may lead to lower premiums. Learn cost of car insurance based on credit score.
• Look for Discounts: Many insurers offer discounts for things like safe driving, vehicle safety features, or memberships in specific organizations. Be sure to ask about all available discounts.
• Shop Around: Always compare quotes from multiple insurance providers. Since each company calculates premiums differently, you may find better rates elsewhere.

Learn more ways to lower your car insurance rate.

The Bottom Line

After an accident, car insurance rates generally go up, with the average increase around 20% to 50%. However, the exact amount can vary significantly based on factors like the severity of the accident, your driving history, and the specific policies of your insurer. As a policyholder, it’s crucial to understand how an accident might impact your premiums and explore options to manage the increase. You can shop around for better rates, look into accident forgiveness programs, or consider adjusting your coverage to mitigate the impact. Always review your options and stay informed to keep your insurance costs in check.

Frequently Asked Questions 

1. Will My Car Insurance Rate Increase If I’m Not at Fault for the Accident?

Ans: Yes, your car insurance rate can still go up even if you’re not at fault for the accident. Auto insurance companies may raise rates because you’re now seen as a higher risk. However, some vehicle insurance providers might offer accident forgiveness programs that can assist you in managing insurance costs effectively. 

2. What Happens to Insurance Policy If I am Caught Driving Under the Influence (DUI)? 

Ans: If you’re caught driving under the influence of any drugs or alcohol, your insurance provider may put you DUI offender list and consider you as a high-risk driver. Therefore, they can also charge you higher rates for your car insurance policy. 

3. How Does Property Damage Affect My Insurance Policy?

Ans: Property damage can increase your insurance policy premiums. When you file a claim for property damage, it signals to your insurer that you’re at a high risk, potentially leading to higher rates. 

4. How Much Does Insurance Increase After a Claim?

Ans: Car insurance typically increases by 20-50% after a claim. It also potentially cancels out any no-claims discounts, even with protection, premiums may rise because no-claim discounts represent a reduction from the base premium. Learn more about how to file a claim after a car accident. 

5. How Much Does Car Insurance Go Up After Two Accidents?

Ans: You’ll see a significant increase in auto insurance premiums after multiple accidents. The exact rates can depend on many factors including the insurance company, location, and driving history. Multiple accidents signal higher risk to insurers which ultimately result in substantial premium hikes.