Car Insurance Rates After an Accident

You can expect your car insurance rates to increase after an accident by $137.78/mo on average if you're at fault. If you're not at fault, your rates generally won't increase.

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Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Jan 22, 2021

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Here's what you need to know...

  • If you are in a car accident, it is likely that your insurance rates will increase
  • Whether you were at fault in the accident will determine your costs for insurance coverage
  • If your rates increase, be sure to keep a clean driving record to ensure they go back down

There is no way to tell how much your car insurance premiums will go up after being involved in an accident. Some insurance providers will not increase your rates at all while others may increase your premiums substantially when you go to renew your policy.

The difference between being in a fault or a no-fault accident can have a huge effect on your possible rate increase. While being in a collision and submitting a claim can cause your premiums to go up, car insurance companies usually consider several factors first.

If you have submitted multiple claims over the life of your policy, have points on your license, or are a young driver, you just might see your premiums increase.

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Why do car insurance companies increase rates after accidents?

When a driver is involved in a fault accident, they are almost guaranteed to see an increase in premiums.

In most cases, when a driver is assigned fault in an accident, a traffic citation will be issued. The police report will indicate what the driver did wrong and they will possibly be given a written warning.

This warning may include failing to yield at a stop sign, driving at a high rate of speed, or driving aggressively.

In a collision, one or both motorists can be assigned fault.

After an accident investigation is conducted, the insurance adjusters will provide a written report that details the amount of damage done to the vehicles, the physical condition of the occupants of the cars, and the events that led up to the accident.

There are some insurance providers that have accident forgiveness programs. However, most will increase rates if the policyholder was at fault in the accident.

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What are the degrees of fault in collisions?

Even if you believe that you were not at fault for the accident, the police and your insurance company might think otherwise. If you executed an evasive maneuver to avoid being involved in an accident, you might still be held liable if your vehicle had bald tires. Most car insurance companies assign fault in percentages.

You can be 25 to 100 percent liable for a collision. The lower your percentage of fault, the less your premiums will be increased. In accidents where a car is totaled, you might see a substantial change in car insurance rates.

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Do car insurance rates increase in a no-fault accident?

Even when a motorist is not liable for causing an accident, premiums can go up.

Remember that your car insurance company will not initially tell you why your rates have increased. You might be notified before renewal and have the opportunity to go over the details of your policy.

If you moved, added another driver on your policy, had your license suspended, or received tickets, your premiums may go up.

The amount of money that your car insurance company paid out in the claim might also impact your rate increase.

Having full coverage on your vehicle is great if you don’t want to have to pay for repair bills, but it can also cause issues when you get into an accident with an expensive car. If the other driver was physically injured and had extensive medical bills, this might cause your premiums to go up.

When do car insurance rates go back down?

If your rates have increased after being involved in a single collision, you might want to know when they will go back down.

If you maintain your coverage and continue to drive for one or two years without being involved in another accident, your premiums will probably be decreased.

In the meantime, you can also participate in a defensive driving class or make changes to your policy in order to get a break. Consider increasing your deductible or taking other drivers off of your policy.

Your premiums can also go down if you had points come off of your license. By being a safe driver, you present yourself as less of a risk.

While being in one no-fault accident can cause some drivers to see an increase in premiums, it is usually a mixture of factors that causes large changes in rates. Only submit a claim if you need to and speak to your insurance agent about what you can do to keep your premiums low.

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