Getting in a car accident would do much more than affecting your car. It can also cause a significant hike to your car insurance, increasing the number of your premiums due to the accident. A 31% increase in car insurance rates is averagely recorded after car accidents in the states. So how much does car insurance increase after accident ?
Several factors would contribute to influencing how much your car insurance would increase after an accident, depending on the situation. It could be whether you are at fault or not in an accident, and these rates are likely to differ with different insurance companies and the state where you live.
At Fault Incidents.
Accidents in which you are at fault with bodily injury and property damages might bring up a more significant increase in your insurance rates. It also has a likely incremental charge ranging from 12 percent to 80 percent, depending on the severity of the case.
However, the resulting claim might not be charged in the first case of an accident. Still, you are likely to pay a higher rate, consequently due to losing any good discounts you might have received for having a clean record void of violations or accidents.
Although accident forgiveness options might kick in for some insurance policy for the first time at-fault incidents, a second at-fault accident will probably jump your premiums with a probable increase charge between 65 – 165 percent.
You should make sure to check and compare how this process affects your state and preferred insurer before purchasing your insurance plan.
The average car insurance rate usually increases for one at-fault in 20 states.
State Average Rate After Accident % Increase
Minnesota $1, 339 $2, 503 87 $1,164
California $1,783 $3,081 73 $1,298
Louisiana $2,228 $3,348 50 $1,120
Michigan $2,368 $3,502 48 $1,134
Delaware $1,838 $2,592 41 $754
North Carolina $1,170 $1,647 41 $477
Georgia $1,815 $2,552 41 $737
Utah $1,212 $1,699 40 $487
Texas $1,644 $2,301 40 $651
Maryland $1,541 $2,154 40 $613
Iowa $1,073 $1,479 40 $406
Nevada $1,578 $2,169 37 $591
Oregon $1,325 $1,801 36 $476
Florida $2,250 $3,045 35 $795
Alabama $1,304 $1,764 35 $460
Washington $1,307 $1,766 35 $459
Wisconsin $1,147 $1,531 33 $384
West Virginia $1,467 $1,934 32 $467
Connecticut $1,980 $2,589 31 $609
Not At Fault Incidents.
The case of how much your insurance rate might increase after an accident if you are not at fault would depend and vary by the insurance company and your state. A single accident, if it is not your fault, might also be eligible for the accident forgiveness policy for some insurer. But if you have been in a couple of accidents, it doesn’t matter if you are at fault or not, your insurer might increase your premiums or decide not to renew your policy.
Accident Forgiveness.
It is a kind of loyalty incentive option offered by many major insurers as a way to avoid increasing the rates of insurance in the case of an accident.
Most insurance companies provide this option to customers with clean driving records with no accidents or moving violations. (customers who might have only had a single accident in a long time can also qualify for this coverage).
The details of an accident forgiveness program would generally vary from insurer to insurer. Some insurers might cut the deductible you might have to pay by as much as $100 – $150 annually if you maintain a clean driving record. Some insurance companies would immediately kick-start this coverage shortly after purchase, while others may give a certain stipulated number of years before the coverage starts, probably over three years.
Accident forgiveness options would always come with a tag. You may be required not to have a moving violation for 3 years, it differs. You must always check other insurance platforms for a more beneficial, suitable, and competitive offer, since staying with one insurer for long does not guarantee you the best offer for obtaining an accident forgiveness cover.
How is an Increase in your Insurance Calculated After An Accident?
A whole lot of major insurance companies make use of standards set by the insurance service office(ISO) to determine how much your insurance rates become after an accident. The ISO standard also allows an increase of 20 – 40 percent of your insurer’s base rate after an accident claim.
The average rate of state charges before discounts, adjustments, and other insurance claim processing fee is the base rate.
Your insurance company would mostly employ a surcharge schedule to determine how much the raise will be. For a multi-car policy, 20 percent of the base rate for the first two vehicles can be used, while 40 percent for a single-car system is for most insurers.
Steps to Lower Your Insurance Rate After an Accident.
There are several ways you can lower your rates after an accident.
- Use Your Accident Forgiveness Clause: Most insurers would offer an accident forgiveness clause and not increase your rates if you are a customer with a clean driving record. This clause can either be valid immediately after purchase or after a specific stipulated time frame.
- Remove Your Comprehensive Coverage: Although this can leave you vulnerable in the case of another accident. You can lower your insurance premium after an accident by removing your comprehensive coverage so that it becomes more affordable. You can add it back later on if you wish. It will be possible if you have up to 6 months to a year of clean driving record after an accident.
- Taking Additional Drivers Education Course: Most insurance companies are inclined to lower the rates of your insurance after an accident if they can see efforts towards improving your driving records. You can also take up a driver’s education course or a defensive driving course. Some insurers would accept you are taking your defensive driving course online.
- Make Adjustments To Your Plan: Depending on your coverage, you can make adjustments to your policy to make the rates more favorable to you. You could either increase the amount of your deductible or lower the amount of your body injury/property damage liability coverage.
NOTE
You must consider if this affects the total coverage for your vehicle so that you remain in a safe position in the case of an accident.
- Explore Discount Options: Many insurance policies offer different discount packages that could affect your rates positively after an accident. You should also enquire from your agent to review all possible discount options that are available for you.
- Check for Better Coverage: As a last resort, you could shop for an alternative insurance company for better rates. It is also good to check for other better insurance coverage for your car, if you have an accident. You could do this at least annually.
You should with this, answer the question, how much does car insurance increase after accident ?
