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How Much Does Car Insurance Go Up After an Accident?

Have you recently been in a traffic collision? If so, you are probably wondering how that might affect your auto insurance premiums going forward. Here is what you can expect.

Our Experienced Car Accident Lawyers Can Help with Your Collision Claim

If you suffered injuries in a car crash that someone else caused, you should not have to pay for the consequences. The experienced Chicago car accident lawyers at Salvi Schostok & Pritchard P.C. have recovered over $2.5 billion in verdicts and settlements for injured clients. You can trust us to use our skills and 40+ years of experience to handle your case effectively. Here are just a few of the recoveries we’ve achieved on behalf of people like you:

  • $33.2 million for a 22-year-old man injured by a drunk driver
  • $5.5 million for a man who was injured when a tow truck hit the semi he was riding in
  • $3.5 million for a man who was struck by a UPS truck

If you have been injured in a traffic collision, contact us immediately. We can negotiate aggressively with the at-fault party’s insurance provider to secure full and fair compensation for your losses, all while safeguarding your insurance premiums.

How Insurance Premiums Are Determined

Car insurance companies are for-profit businesses that make those profits by collecting more in premiums than they pay out in claims. Because auto insurance companies must pay out claims when their policyholders cause crashes, they are motivated to identify riskier drivers and charge those drivers higher premiums to offset the cost of insuring them.

Here are some risk factors that affect auto insurance rates, according to the National Highway Traffic Safety Administration:

  • A driver’s crash and claims history
  • A driver’s driving record, including any moving traffic violations
  • A driver’s age, as younger drivers are involved in a disproportionate number of collisions
  • A driver’s gender, as male drivers are 40 percent likelier than female drivers to be involved in injury collisions
  • A driver’s location, as certain states have more expensive insurance rates

How Collisions You Caused Can Affect Your Car Insurance Rates

Insurance increases after a car crash because it costs the insurance company money to pay claims. Insurance companies believe past behavior is the best indicator of future behavior. By their reasoning, causing one crash means you are likelier to cause another crash in the future. Consequently, it is more expensive for the insurance company to provide your insurance coverage.

But how much does insurance go up after a crash? This depends on several factors, including the severity (and cost) of the crash and the insurer’s own policies. For example, Forbes studied how ten major insurance providers increased rates after a property damage crash. It found that GEICO charged the highest insurance increase, at 73 percent, while State Farm charged the smallest increase, at 21 percent. Most insurance companies fell somewhere between 34 and 59 percent. The average annual auto insurance rate increase in premiums after a crash across all ten companies was $740.

The more the car insurance company pays to resolve claims, the more likely it will raise rates. For example, fender bender tend to result in lower rate increases than insurance claims that involve severe injuries or extensive repair costs.

How long an accident stays on your driving record varies by state and insurer but typically ranges from three to five years. During this period, insurance companies will consider your crash and driving history when assessing their risk in insuring you. Some states have specific rules on how long a car crash can impact your insurance. In some cases, the crash’s severity can also affect how long your car insurance rates go up.

To offset this expense to the policyholder and build consumer trust, many insurers offer accident forgiveness programs. Accident forgiveness means your insurance company will not raise your premium after your first collision. These programs vary by company but generally work in one of two ways:

  • As a Reward for Safe Driving: Some insurers automatically include free accident forgiveness for customers who have been with the company for several years without any collisions.
  • As an Optional Add-On: In other cases, drivers may have the option to pay an additional fee to add accident forgiveness to their car insurance policy.

However, the specifics of these programs, including eligibility criteria, vary widely among insurers. Read the fine print to understand the terms of your policy’s accident forgiveness policy.

How Car Collisions Others Caused Can Affect Your Car Insurance Rates

Generally, you will not see a rate increase after a crash for which you are not at fault. Insurance companies assess risk and responsibility when determining premiums, and things outside your control should not affect the cost for them to insure you. This includes situations like:

However, it is important to note that there can be exceptions. For instance, if you are frequently involved in crashes, even if you were not at fault, some insurers may consider you a higher risk and adjust your premiums accordingly.

Why It’s Important to File an Insurance Claim After an Auto Collision

You should still file a claim even if you are afraid your insurance rates might increase after a crash. Filing a claim ensures you utilize the protection and coverage you pay for. Depending on its terms, your policy could cover repairs, medical expenses, and other costs associated with the incident. You may also have a contractual obligation under the terms of the policy to report any collision to your insurance provider.

Do not jeopardize your rights. File an insurance claim, ideally with the help of an experienced attorney. They can determine if the other driver was to blame and help you seek compensation for your medical bills, lost wages, property damage, and more.

The legal team at Salvi Schostok & Pritchard P.C. wants to help you seek justice after a car crash. Contact us today for a free consultation with our Illinois car crash lawyers.