You consider yourself a safe driver. You follow all the rules, you always obey the speed limit, and double check intersections. Despite all of this, you find yourself in an accident that results in injuries and property damage. Knowing that everyone involved is okay, your next thought is: How high are my rates going to go up after my car insurance company finds out about my accident? The truth is they might go up, or they might stay the same. Continue reading to learn how accidents affect your insurance and why the outcome always depends on the circumstances surrounding your claim.
Car Insurance Agencies Don’t Determine Your Rates
First and foremost, drivers should understand that car insurance agencies are not the ones in charge of setting coverage rates – the insurance companies are. Whether you have been with the same insurance agent for decades or just days, your premiums are calculated according to the same formula that is used for every other driver that is insured with the same company. That being said, every insurance company places its own unique emphasis on factors that could affect your rates, such as car accidents and accident claims. One insurance company may automatically raise your rates for a scratch in your paint, whereas others may be more forgiving for a small claim or if you have a good driving record.
Who Caused the Accident?
The detail that all insurance companies want to know is whether the accident was your fault or that of another driver. If you are not cited for an accident and the at-fault driver’s car insurance picks up the tab for your vehicle repairs and bodily injuries, your insurance is less likely to change.
However, there is a chance that your insurance may be affected if you need to file a claim due to an accident or claim you had no control over, such as hitting a deer, sliding on a patch of black ice, or having your car stolen. This is especially true if you file repeated claims of this type.
In recent years, many insurance companies have begun offering a feature known as “accident forgiveness.” This kind of protection assures drivers that their first accident will not raise their rates, regardless of their fault in the collision or the cost of the claim. Accident forgiveness is not available from all insurance companies, so talk with your independent agent if this is a feature you are interested in.
Should You File the Claim?
Many drivers hesitate to submit a claim for fear of how it might affect their insurance rates. It is important to remember that you have car insurance for a reason. You can file a claim for any covered loss, regardless of how big or small it may be. Of course, filing a $750 claim when you have a $500 deductible might save you $250, but it might not be worth the increase in premiums you’ll see in the coming months or years. That is something you should decide for yourself – perhaps with the help and advice of your trusted independent insurance agent.
If you have a question about filing a claim and whether or not doing so will affect your car insurance rates, give us a call. We’re always happy to help out.