If you take some time and shop around you may find cheaper insurance after an accident in your state and save money. Here is what you should consider.
While a car accident happens quickly and takes a few moments, the financial consequences may stick with you for quite a while.
Keep in mind that the national average increase is 45% after a car accident with property damage and 47% for causing an accident with inquiries.
The rates may jump by hundreds of dollars depending on your coverage.
If you take some time and shop around you may find cheaper insurance after an accident in your state and save money. Here is what you should consider.
What does your policy cover
The majority of policies cover the driver, his or her family, and individuals who may drive your car with your permission.
It may be enough to 300 cash advance for a small need, but you will need to take out a loan or use your credit card to cover auto repair costs especially if you don’t have insurance.
If you want to learn more about your coverage and who can be excluded from it, read carefully your policy. Each policy may have different coverage.
Most policies cover:
- Accidents that occur when you or another person covered by your policy is driving a rental auto
- Accidents that occur when you are driving in other states and Canada
- Damage to your auto due to hail, fire, flood, theft, hitting an animal, or flying gravel
- Attorney’s charges in case you are sued due to an accident
- Auto repair costs, medical bills, lost wages
Most policies don’t cover:
- Accidents that occur when you are driving an auto you don’t own but utilize regularly, such as a company-owned auto
- Accidents that occur when you are delivering food or driving for a ride-hailing service for a fee
- Equipment not constantly installed in your auto
- Damages that were caused by you deliberately
- Accidents that occur when you are racing, driving for business, or driving in Mexico
How an accident affects your car insurance rates
Auto insurance protects you financially by covering the repair costs and medical bills to another driver if you caused an accident. Texas Department of Insurance issued a Consumer Bill of Rights for car insurance.
Texas law demands drivers provide proof that they may pay for the accidents they cause. It can be done if they purchase car liability insurance.
Depending on the type of coverage a person has, they may pay to replace or repair their auto in case it’s stolen or damaged.
A car accident typically affects your auto insurance rates for a period of three to five years. The exact rates differ among states as well as your insurance provider.
The providers will most likely increase your rates as they view you as a greater risk even if a minor crash happened.
A driver with a clean record pays $832 less annually compared to a driver with an at-fault accident. In 18 states, median rates went up at least 50% after an at-fault accident.
The annual rates for drivers who caused an accident were over $500 higher in 44 states as well as in Washington, D.C.
Some companies are rather unfair
Safe drivers who are in car accidents caused by other people usually notice auto insurance rate hikes, mentions the recent research by the Consumer Federation of America.
For instance, New York City drivers pay the most for doing nothing wrong. Some companies are even more unfair than others. CFA tested the way five major companies treat people after accidents that caused others.
State Farm never boosted premiums for such accidents and Allstate penalized drivers who weren’t guilty from time to time.
Farmers and GEICO occasionally increased rates by 10% and higher for not-at-fault accidents. Progressive raised these rates the most, charging penalties in each test where this increase isn’t banned by state law.
Can my insurance rates go up if I didn’t cause the accident
When you cause an auto accident that leads to injuries and damage, your car insurance rates will typically go up. The rate increase
won’t happen in the following situations:
- You legally parked your auto when it was damaged.
- Your auto was struck in a hit-and-run accident.
- Another vehicle struck your auto in the rear while you didn’t do anything wrong.
In case you are involved in a car accident, you may be demanded to provide proof that you aren’t guilty. Here are some documents you may be asked to collect:
- A statement from the insurance company of the other driver accepting the fault
- A police car accident report
- Written statement by another driver attesting to their fault
- A legal paper demonstrating that you were compensated for accident damage
How long an accident will affect your car insurance rates
Many people have concerns about the period at-fault accidents will affect their car insurance rates.
It depends on the state they live in as well as their insurance provider. Typically, this period ranges from three to five years.
For instance, a car accident that happened in Texas or New York will affect your insurance rates for the past three years. Accidents that occurred in Massachusetts apply surcharges for five years.
The cost of surcharges applied to a policy for every year you drive without incidents may be lowered in some states and by some insurance providers.
How can I find cheap auto insurance after an accident
The best way to find a cheaper insurance rate is to take some time and compare several service providers. Shop around for the most affordable rate to make certain you get the lowest rate.
Some of the most popular ways to lower rates on your present insurance policy are:
- Add discounts to your coverage. It may help you diminish the increase in your insurance rate from a car accident. Ask your agent or insurance provider about possible discounts.
- Raise your deductible. This is the sum reduced from a prospective claim check from collision or comprehensive insurance. In case you get into a car accident in the future, it may cause higher out-of-pocket expenses for repair.
- Boost your credit. It can be a long-term objective that will take quite a while. However, it’s essential to maintain a good credit score to receive more reasonable insurance rates.
The bottom line
You should see an insurance rate increase only if a car accident was caused by you. If another car rear-ends you at a red light, it isn’t considered an at-fault accident.
In reality, different states have different regulations and options in how they cope with at-fault or partial-fault accidents. Increased rates may happen if you have been in some accidents.
It may be a wise decision to compare car insurance quotes from several providers and shop around if you aren’t satisfied with your present rates or service.
Tatiana is the news coordinator for TravelDailyNews Media Network (traveldailynews.gr, traveldailynews.com and traveldailynews.asia). Her role includes monitoring the hundreds of news sources of TravelDailyNews Media Network and skimming the most important according to our strategy.
She holds a Bachelor's degree in Communication & Mass Media from Panteion University of Political & Social Studies of Athens and she has been editor and editor-in-chief in various economic magazines and newspapers.
