What Happens To Car Insurance Rates After An Accident?
If you’re involved in an auto accident, you might be facing some uncertainty. Will your insurer cancel your policy? Or might they raise your rates?
Don’t worry. Many times, you still have protection. Here’s a look at what you can expect along the way.
Do Rates Increase After A Car Accident?
Let’s say the wreck was your first accident. Your vehicle does not have a lot of damage, and you did not do a lot of damage to the other party. Will your rates go up? Many times, auto insurance companies will adjust rates depending on the situation itself. It’s important to know when your rates can jump significantly and when they are not likely to increase all that much.
Minor Damage: In situations where the damage is minor, your auto insurance company is not likely to increase your rates drastically. Most often, insurance companies expect their clients to see at least a few claims during their lifetime. Minor claims might only cause a small rate increase.
A Big Accident: Let’s say that your claim is very high. Perhaps you struck a deer and have a vehicle the insurance company plans to total. Or, perhaps you caused a wreck because you were driving drunk. In cases like these, your rates may rise significantly. This is the case because your insurer now has to pay for your repairs or a replacement vehicle. Furthermore, the accident — such as the DUI — might clearly signify that you are a high risk to insure, and the insurer will have to cover their cost risks.
No Major Accidents: Perhaps you are a driver with a long history of safe driving. You do not have a lot of claims or any major moving violations on your account. This is a good indication that your agent is not going to drastically increase rates (again, this will depend on the situation). If you’ve had no claims at all during your last policy period, you will likely see no increase at all.
When Will Rates Go Up?
Every auto insurance company provides information about factors that can increase premiums as well as lead to the company dropping your coverage. Most often, this includes repeated claims or reckless driving claims. And, many policies are not likely to raise your costs in the middle of your policy. If rates are likely to increase, they may happen when you renew your policy down the road.
There Is Help Available to You
If you have just a minor accident on your record, let your All Types Insurance Agency agent know. They can help you file a claim and move on. Most often, your auto insurance company can also give you insight into what to expect when you renew.