How Much Does Your Car Insurance Go Up After an Accident?
A car crash can flip your world upside down – no matter how minor it might be. Not only will you possibly have to deal with the impact of physical injuries and damages to your vehicle, you also have to consider your experience with your insurance company and how your rates might change.
So, how much does your car insurance go up after an accident?
This varies heavily depending on your driving history, the insurance plan you hold and your specific insurance company.
Average Car Insurance Rate Increases After an Accident
Usually, for up to five years after it occurs, a car accident will affect your auto insurance premium regardless of your state or company. Minor crashes may not result in significant claims, but they impact how insurance companies look at your risk profile, meaning higher costs for you. This is true regardless of whether you have an otherwise clean driving record and are a safe driver.
Before an accident, you might pay around $102/month on your auto insurance. But, after an accident, this can increase by nearly a third to $132 on average. Then, if you have another accident within the next few years, you can expect to pay much more on average, at $165 per month.
Each car insurance company operates differently after an accident, raising rates by different amounts in each case based on your profile, car, situation, and so forth. It’s important to understand what will happen if you are or are not at fault for the accident and what you can do to mitigate some of the changes you’ll see on your policy as a result.
In the sections below, you’ll see how drivers experience rate hikes after an accident and what you can do to save money on your car insurance afterward.
Will My Insurance Rates Go Up If I Didn’t Cause the Accident?
The short answer is, it depends.
Even if you weren’t found responsible for an accident, your insurance company might decide to increase your premium. In some cases, this increase can be steep. Drivers can find themselves paying 10% more on their car insurance than they did before the accident, with absolutely no change in their policy benefits or coverage.
The reason for this may be that you live in a “no-fault” state like Washington or Texas, where anyone and everyone involved in an accident must file claims for injuries and damages no matter who the responsible party is. These claims will pay for medical costs, lost income, funeral expenses, and even child care for those involved. As a result, anyone involved in an accident will see an increase in their premium simply because they filed a claim.
Other states, like California, don’t legally allow increases to your premium when you’re not at fault for an accident. Sometimes the insurer themselves will promise not to increase your car insurance costs if the accident is determined to be out of your control. Further, if accident forgiveness is part of your policy, you may not see a rise in your car insurance rate after your first incident on the road.
What is Accident Forgiveness?
The idea of accident forgiveness describes the insurance benefit that prevents hikes in your premiums after an accident. It’s a possible feature of your car insurance policy that stops your insurance record from being changed negatively due to an accident, even an at-fault one. It’s a great way to save on your car insurance.
While the insurance company won’t forgive every accident, it often helps tremendously with a first, at-fault accident if you carry an otherwise clean driving record. Each insurer has guidelines for forgiving (or not forgiving) an accident when it concerns increasing your policy premium.
Your current car insurance may already include accident forgiveness, but you might also need to purchase it as an add-on to your existing policy. If you qualify and have a clean record, it can help you save if you are ever the responsible party in an accident. Unfortunately, not every insurer offers accident forgiveness, but many major companies do.
Among them, Allstate and Progressive are notable options. Allstate offers accident forgiveness as a helpful add-on to your existing policy, including great discounts when you’re a driver with a clean, safe record. In fact, you might save every six months that you stay accident-free. Progressive takes another approach — forgiving minor accidents quickly as part of a loyalty program to resolve claims promptly and avoid increasing rates.
As you shop for cheap car insurance, ask about accident forgiveness and determine if you qualify to protect yourself from at-fault accidents within certain limits. This may not be an option if you’ve had an accident within the past few years or carry various tickets and driving violations on your record. Nevertheless, accident forgiveness is a smart rider to add to your auto insurance policy before you think it’s necessary.
How Can I Lower My Car Insurance After an Accident?
Without accident forgiveness, you’ll likely see a significant increase in your insurance rate after an accident, but there are ways to save. If you follow some simple guidelines for handling yourself with the insurer, you’ll find them interested in working with you to lower your rate. Beyond potential forgiveness, you can also always find a lower car insurance premium after an accident and improve other features of your driving profile.
Be Honest With Your Insurance Company
The first step is to tell your car insurance about every accident, no matter how minor it may seem. Even if you think the insurer won’t find out about it, the other party can sue you for damages, weeks or months after the driving incident. If this happens and you haven’t reported the accident, your insurance company can refuse to pay any related bills, especially legal fees. You save, in short, by being completely open with your insurer from the beginning.
Ask About Accident Forgiveness
As a next step, consider that some insurance companies will recognize the common problem of having accident forgiveness insurance. Each company has different requirements and conditions related to accident forgiveness, but giving them a call to ask about the possibility is always worth the effort. After your first accident, many will forgive your accident, while others are more generous, covering you with accident forgiveness insurance for up to five years.
Shop Around for the Best Rate
If you’ve informed the insurance company and asked about forgiveness, but they’re unwilling to work with you to secure a better rate, it’s time to shop around for another car insurance provider with a lower premium. Insurance companies differ widely on the rates they offer those with accidents on their records. Remember, as you look around, it’s best to get multiple quotes from different providers to see the best rate for you even after an at-fault collision.
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Drop Insurance Coverage Options
Because of their accident history, some drivers find it helpful to save on their insurance after an incident by dropping some coverage options. For example, comprehensive car insurance policies cover you in the case of a non-collision accident such as theft, fire, or storm. If this insurance is optional to you and your car’s value isn’t too high, you might consider taking on the potential risk by lowering or cutting your comprehensive coverage to get a break on your premiums.
This is not the first option because natural disasters, vandalism, and thefts can be costly. But, if you have an older car with a lower actual value, it may make sense to drop this coverage until you replace your vehicle.
These are the most accident-specific ways you can quickly lower your car insurance rates. Like many facts in auto insurance, the outcome and effectiveness of these approaches will depend mainly on your chosen car insurance company and the type of policy. In truth, some auto insurance providers are better than others when understanding, forgiving, and pricing car insurance after an accident. If you’re involved in an accident, it may be time to consider going with a provider that offers the lowest car insurance after an accident, like those in the next section.
Cheapest Car Insurance Companies After a Crash
Unfortunately, accidents may make it so that you can’t afford your premium with your current insurance company. Still, drivers have the opportunity to shop for new coverage and compare car insurance companies after the fact. For drivers who had a spotless driving record prior to their first at-fault accident, a big-name carrier like Liberty Mutual might be a great place to start. But if you have a poor driving record, a “non-standard” carrier like The General or SafeAuto may be a better option with cheaper rates.
But at the end of the day, there isn’t going to be one company that offers the cheapest rates for all drivers after an accident. Since rates can vary so much from driver to driver, the only way to guarantee you get the cheapest rates is by getting quotes and comparing rates from multiple companies. The good news is, sites like Compare.com do the hard work for you. Just enter your ZIP code below and get the best rates from dozens of the nation’s top companies in less than 5 minutes.
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FAQs About Car Insurance After an Accident
What factors affect my premium other than my driving history?
Other than your driving history and accidents, car insurance companies will look at every factor affecting the risk to insure your car. This starts with your age and gender, but you’ll see insurance companies also take an interest in your credit history, job, education, neighborhood, and more. If you’re ever in an accident or get a ding on your driving record, some of these other factors will help you secure a lower rate for your car insurance. This is especially true if you work to improve them or they change over time, such as your creditworthiness and where you live.
Will a no-fault accident appear on my driving record?
No-fault accidents appear on your driving record. If, for example, you were rear-ended by another driver in traffic, and your vehicle sustains damage, you need to inform your insurance company. When you do this, the company will take note of the accidents on your driving history as they consider your new car insurance rate. Whenever a claim is submitted, whether you’re at fault or another driver is, you can be sure the insurance company will record this on your driving record and use it to quote your rate even when you shop for new insurance.
What is SR-22 insurance?
SR-22 insurance is a special form of insurance certification that promises your financial responsibility. Some states require it for drivers who have been in multiple accidents and are prone to claims and damages. SR-22 is not truly a type of insurance, but it’s a state-given form of proof needed to show that you carry the appropriate insurance required by law. This is for the most high-risk drivers, and the situations requiring an SR-22 form often come with expensive car insurance coverage.
How long will my rates be high after an accident?
The specific time your insurance company will raise your car insurance premiums after an accident depends. However, it’s typical that car insurance companies will consider the last 3-5 of your driving record. After 5 years, an accident on your record likely won’t impact your insurance premium. However, other accidents and risk factors may affect this timeline, and it’s essential to do what you can through driver education and discounts to offset the potential increase in costs before then.