How Claims Affect Your Auto Insurance Rates

Not all auto insurance claims are treated the same. Some will significantly impact your car insurance rates, while others will barely affect your premiums. Let’s take look at what different insurance claims means for your wallet.

General claims

With comprehensive insurance coverage, general claims that don’t involve a collision — such as theft, vandalism, fire, or broken windows — will generally not affect your insurance premiums, so long as you’re not at fault.

However, there are exceptions. If you make a lot of these types of claims, your insurer can actually choose to increase your deductible or even terminate this coverage from your policy.

Claims related to collisions 

Claims made following a collision can have a considerable affect on your insurance rates, especially if you’re deemed to be at fault for the crash.

Fault is determined by your insurance company. You may be found fully or partially at fault, according to a set of government guidelines your insurer must follow. In almost every scenario, at least one driver involved in a crash needs to be determined to be at fault. Even if the police decide not to lay blame on any party, in terms of driving charges, your insurer may still determine that you were partially or fully at fault.

If you’re not at fault: Your rates aren’t likely to increase after you file a related claim.

If you’re found to be at fault: The crash will be recorded on your insurance record and can have an impact on how much you pay each year.

If you have a clean driving record: Generally, this means an average of six years’ of claims-free and conviction-free driving. When you’re found to be at fault in a crash, your insurer may not increase your premium, or may increase it by only a small amount.

If you’re involved in a second collision: If you’re found to be at fault for another collision within the next five years, you can expect your insurer to significantly increase your premium because you’ll be considered a higher insurance risk.

If you rack up additional at-fault collisions or driving convictions: You’ll be in worse shape. If that happens, you’ll be considered a high-risk driver and your only option might be coverage from an insurer that specializes in such cases. Unsurprisingly, your insurance will be more expensive.

If you lend someone your car: Your insurance is attached to that car. So, if your friend has an at-fault crash in your car, their crash goes on your insurance record and your premium could increase because of that.

If you have accident forgiveness insurance: This is one way you can try to offset premium increases for an at-fault crash. This is an additional coverage you can buy to protect yourself against rates increases.

If you have no-fault insurance: The name is a little misleading. Even with this type of coverage, you can still be deemed at fault. The no-fault system simply means you only deal with your own insurance company for all claims. Even if you’re the driver at fault, your insurer only has to pay for the damage to your car, not for damage you caused another other driver.


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