How Much Does Insurance Go Up After an Accident?

Feb 1, 2023




You never know when you might be in an accident. Although it can be stressful to be involved in an accident at fault, car insurance can provide financial security by covering the damage to all vehicles, property damage, and medical expenses. However, any claim you make can increase your rates, even for minor accidents.

The amount of your insurance claim after an accident will impact your premium depending on many factors, such as the accident’s severity and who was at fault. Accidents can affect your auto insurance premiums, how rates of different companies are involved, and ways to reduce your overall costs will help you get the best rates.

What will my car insurance cost after an accident?

Your car insurance rates will increase if you are involved in an accident. This is because insurers will consider you a more risky driver and decide you are more likely to file future claims. Your driving record, claims history, geographic location, age, gender, and insurance provider influence how much your premium will rise after an accident. Insurers consider young drivers under 25 particularly risky and may increase their premiums.

In some states, your average increase in premiums after an accident is more significant than the national average. Your premiums will increase the more damage you do to your vehicle in an accident. You could lose your good driver or claims-free discount if you are involved in an accident. This is another reason why auto insurance premiums can rise after an accident. You may also see a steeper rate increase if your history includes at-fault incidents. This is because insurance companies may consider you a high-risk driver.

Optional comprehensive coverage is part of full-coverage car insurance. It covers damage to your vehicle but does not concern a collision. Total claims can be filed if your car is damaged by fire or flood, vandalism, theft, or tree limb. Comprehensive claims may increase your premium, but it is worth contacting your insurance company to obtain the coverage you have paid to restore your car to pre-incident conditions.

Car insurance for an accident by the company

Car insurance companies have many opinions about how much to raise rates after a crash. Only a handful of companies we examined didn’t charge more for a minor accident in some states.

We found many companies that charged twice as much for drivers who had been in an accident than they did for the exact driver who didn’t. In a few cases, the average rate for an at-fault driver was more than $2,000 per year.

Compare car insurance rates from multiple companies to find the best deal.

The country’s four largest auto insurance companies, Allstate, Geico Progressive, Progressive, and Geico, account for more than half the market. USAA is the fifth-largest auto insurance company. It’s only available to veterans, active military personnel, and families.

We compared the average rates in 45 states and Washington, D.C., to see how significant insurers price policies for at-fault accident victims.

State Farm had the lowest average rates for drivers involved in an accident and drivers who weren’t. It also had the most inferior percentage difference between drivers with clean records and recent crashes.

Average rates of the largest auto insurance companies after an at-fault car crash

[table https://www.nerdwallet.com/article/insurance/how-much-insurance-goes-up-after-accident]

USAA often offers the best rates for eligible drivers before and after an accident. USAA may not be the best option if a driver is involved in an accident. USAA is the cheapest option for drivers with a clean driving record in Alaska, Kentucky, and Mississippi. However, other companies pay lower rates for drivers involved in an accident.

Whether you are insured with USAA, another company, or not, comparing car insurance rates after an incident is wise.

Why does the insurance rate go up after an injury?

Insurance providers do not raise rates to punish you. Insurers adjust your rates to reflect the new data from an at-fault collision. They will consider you a more risky driver if you have a history of causing accidents. Although at-fault injuries are the most likely to raise rates, any claim can increase your auto insurance premiums. This is especially true if you file claims frequently in a short time.

Auto providers will charge you more if you are considered riskier to insure. The spike in your rates after an accident may not last. Most auto insurance rates will drop within a few years of an accident, provided you have no additional at-fault events or moving violations (MVR span>).

Suppose your auto insurance rates have increased after an accident. In that case, you can get quotes from other carriers to lower your premium. You should also know that your new insurer can access information about your claim on your MVR. This will include how much was paid out. However, every company has different rates. You may find that another insurance company charges less even after considering your claim history. Switching insurance providers has its pros and cons. Make sure to weigh all aspects before you make a decision.

Programs for Accident Forgiveness

You might be eligible for a waiver of the claim surcharge if you were enrolled in an accident forgiveness plan before your accident. While guidelines can vary depending on the state and provider, most accident forgiveness programs will waive the first at-fault loss on your policy. They also waive any other losses within a specific time frame, usually three to five years.

Most accident forgiveness programs can be added to your policy as an optional endorsement. You may be eligible for accident forgiveness coverage if you’ve been with the same company for a long time. However, most companies will charge an additional fee to participate. Some may also have restrictions for new customers or drivers.

These major auto insurance companies are just a few that offer accident forgiveness coverage to eligible and enrolled drivers.

How long will an accident remain on your record?

Averagely, an at-fault car accident will affect your driving record for three to five years. The exact time it takes depends on the severity of the incident and your state. For example, in New York State, an accident or traffic violation will remain on your record until the end of the previous year, plus three years. An accident or violation in Oregon will stay on your record for five years.

You can expect to have the incident on your record for at least five years and your entire life. For information on driving record requirements in your state, visit the Department of Motor Vehicles (DMV).

Reduce your car insurance rates following an accident.

Are your auto insurance rates rising after an accident? If so, you might wonder if there are ways to lower your premium or get cheap car insurance.

Even if your auto insurance company doesn’t offer accident forgiveness, there are still ways to lower your insurance rates after an accident. Talking to your agent is the best way to discover how to save. They may offer discounts to low-mileage drivers, students, or members of certain occupations or organizations. You can also bundle your auto and home insurance with the same insurer. These discounts can sometimes lower your premium by 25%, regardless of your driving record. You can stack discounts to maximize your savings and get closer to the lowest rates.

These methods could help you cut down on your accident-related premium:

  • Your credit score can play a part in your car insurance rate. To improve your credit standing, you should stick to your budget and pay off any debts.
  • Your deductible should be increased: Higher deductibles for comprehensive and collision coverage will lower premiums. Remember that raising your deductible will increase your out-of-pocket expenses if you file a claim. You may be able to pay out-of-pocket for minor accidents. However, ensuring that your deductible is affordable will help you avoid financial problems if you are involved in a significant accident.
  • Check for discounts: Many car insurance companies offer student or multi-policy discounts. Many companies also provide usage-based telematics programs that monitor your driving and give discounts for safe driving habits, such as adhering to posted speed limits and braking patterns. Progressive Snapshot and Allstate Drivewise are some examples.
  • Compare prices: When your policy is up for renewal, it’s good to shop around to compare the current rates offered by different car insurance companies. Although it may seem challenging to find car insurance that provides the same coverage for the same price as the policy you had before an at-fault incident, you can find other companies that offer different coverage options and discounts.
  • Change your coverage options: You may need to reduce your insurance premium if necessary. It would help if you discussed these changes with an agent. However, lowering your insurance policy could reduce your premium. While you will need to continue to have the minimum coverage required by your state, and if your loan or lease covers your vehicle, you may be able to trim your optional coverage.
  • Please look at a different vehicle: Insurance companies rate every make and model differently, and it is more expensive to insure higher-priced cars. It all comes down to safety ratings and the cost of repairs. These are some of the cheapest options to insure your vehicle if you want to lower the cost of your insurance.

Using one or more of the strategies above could reduce the impact of higher accident rates.

Get cheap car insurance for an accident in

Are you looking for cheap car insurance following a crash? Below, you can find the average car insurance rate after an accident based on your location.

[table https://www.nerdwallet.com/article/insurance/how-much-insurance-goes-up-after-accident]

You can get a lower rate if you have an accident.

Shopping around for the best rate after an accident is the best method to ensure you get the lowest price. Our analysis shows why:

  • You could save a lot of money by shopping for the best car insurance after a collision. Our analysis suggests that you could save more than $1350 per year by shopping for the lowest possible rate after a crash, depending on where you live.
  • No car insurance company is cheaper than another. This was true across all 50 states and Washington, D.C. Twenty-three insurance companies competed for the lowest option in an accident.
  • Sometimes, the cheapest insurance company might not be the best before an accident afterward. About half of the states we examined required drivers to change insurers after an accident to keep their rates low.

The best insurance companies sometimes offer the lowest rates. For example, the rates for Farm Bureau Insurance in Minnesota showed the weakest rates following an at-fault collision in three states. Despite being the ten largest auto insurers in the country, the rates of smaller companies after an accident in 22 U.S. states and Washington D.C. were the lowest. There are a few smaller insurers that are available under a few conditions.

How do you find affordable car insurance after an auto accident?

Although shopping around is the best way of finding the lowest rate, there are other options. There are ways to lower your rate on an existing policy.

  • Your deductible is the amount you pay for any potential claims from collision or comprehensive insurance. If you are involved in an accident, this will result in a higher out-of-pocket expense to repair your car.
  • You can offset an increase in your insurance rate due to an accident by adding discounts to your policy. Ask your agent or insurer if there are any additional discounts available.
  • Improve your credit score. A healthy credit score will lower car insurance rates in most states.

What happens if it’s not your fault?

Your auto insurance rate might increase even if you aren’t at fault for an accident. According to the Consumer Federation of America, some insurance companies increase rates by 10% for accidents that are not your fault.

Everybody involved in an accident can file a claim for injuries to their insurance company in the 12 no-fault states. Residents of these states are more likely than others to experience rate increases following an accident, regardless of who is at fault.

Your rate will not rise if you have accident forgiveness on the policy. A few states, such as California and Oklahoma, prohibit insurers from raising your rates if you are not at fault for a crash. USAA is one company that says they won’t increase rates if you’re not at fault for an accident.

Regardless of fault, getting car and auto insurance quotes is a brilliant idea to ensure you get the best price.

Alternative car insurance for high-risk drivers

You may be considered a high-risk driver if you have been involved in multiple accidents or have other serious marks. High-risk drivers are more difficult to find coverage as they are considered high-risk.

If you cannot find an insurer, who will sell you a policy, you can look into state-run risk plans. This is a high-risk pool where you are assigned an insurer by the state. Locate your form in the directory at the Automobile Insurance Plan Service Office. Ask your agent for assistance.

Frequently Asked Questions

Should I file a claim with my insurer if my rate goes up?

  • A few factors will determine whether you should file a claim with insurance and risk having your rate increase. It might be worthwhile to get quotes for repairs if you were involved in a minor accident. The repair costs can be compared to any deductible. Filing an insurance claim may prove beneficial if you were involved in a severe accident that caused bodily injury or property damages. It may be helpful to discuss your claim with an agent to decide which route you should follow.

Do car insurance companies offer accident forgiveness?

Although many national and regional car insurance companies offer accident forgiveness, the eligibility and availability of each carrier will vary by state and carrier. Allstate, Geico, and Nationwide are some of the insurance companies offering accident forgiveness.

What happens to car insurance after an accident?

An at-fault incident typically affects car insurance rates for three to five years. The time it takes to lower your car insurance rates after an accident depends on what type of accident occurred and your driving record. An example: A three- to five-year auto insurance premium increase is for an at-fault accident. However, there is another at-fault incident within the same period. In that case, you could be subject to higher premiums over a longer time. Contact your insurance company to learn more about how insurance claims affect your premiums.

Will an insurance rate increase affect my credit score?

Your credit score will not be affected by increasing your insurance rates. Suppose you are a resident of certain states. In that case, however, your credit score may impact the amount you pay for auto insurance.