How do car insurance companies find out about accidents?

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Joel Ohman
Founder, CFP®

UPDATED: Oct 28, 2016

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Here's what you need to know...

  • You may not want your insurance provider to know about an accident because you fear your insurance premiums will increase
  • However, even if you do not tell them, your insurance company may find out anyway, especially if your car is in need of repair
  • If your vehicle is taken for repair, the accident may end up on the CLUE list which stands for Comprehensive Loss Underwriting Exchange.
  • The CLUE list allows your carrier to check this report to see if a claim was filed under your name or the name of the other party to the accident

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Is it okay if my car insurance carrier finds out about my car accidents?


Many companies offer accident forgiveness in many cases. This is an incentive for your business.

Therefore, if you have a fender bender or minor accident with minor injuries, your carrier may consider this accident to be forgiven.

On the other hand, if the accident results in major injuries or happens because of a DUI, your carrier may not be as forgiving.

You may have to pay the consequences for this one.

Your first concern is going to be the likelihood of license suspension in either case. License suspension will depend on the state where the accident occurred and where your car is registered.

Since each state establishes its own laws regarding traffic violations, the state will be a determining factor. However, the outcome can be easy to predict since many state laws are similar.

For instance, if you live in a no-fault insurance state, it does not matter who is at fault in an accident. Each insurance carrier pays for his or her subscriber’s medical expenses and damages according to the terms of the policy.

If the event happens in a state where liability exists, there may be an increase because of the expenses to the insurer. The amount of the increase may hinge on the state also. The state has a set standard of how much a company may raise your premiums.

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Once my car insurance carrier finds out about my car accident, when will they raise my premium?

Your insurance carrier may not find out about your car accident for a few months. If you recently acquired or renewed your policy, it may be a couple of years before they examine your Motor Vehicle Record (MVR).

There are times when the accident requires the notification of carriers.

If the accident warrants a look at the MVR, then the insurance carrier will look it over.

If your accident is due to a DUI/DWI, your options change.

Your carrier will become aware of your accident and possibly cancel your policy immediately. If you go to court and your license is suspended or revoked, you will not need insurance.

How can I get my premiums back down after my carrier finds out about my car accident?


If you weathered the storm of an accident and it has been a few years since it occurred, congratulations! It is now time to work on getting a rate reduction.

Did you know you can call your carrier and request a reduction? Accidents may stay on your MVR for three, five, or seven years depending on the state.

If you live in a state where your accident remains for five years, you may call your carrier after year three with no violations and make your case.

If they do not consider it this year, they may consider it the following year. The point is as long as you continue driving without incident your chances increase.

Should I take a class after my insurance company finds out about my car accident?

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If your car accident involves the police then you might have received a ticket. This could generate as many as six points on your MVR.

Your insurance company will more than likely find out about the accident; however, you may be able to take a class to lessen the impact.

Taking a defensive driving class may knock three points off your MVR, which in turn may have an impact on the cost of your insurance premiums.

Always drive with awareness and caution!

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