Getting back on the road after an accident can be a challenging journey. Depending on your policy and the state you live in, you could be facing large insurance rate hikes after an accident. How much your insurance goes up will vary depending on who was at fault and if bodily injury claims were made. Your premium will probably increase, but you can still find affordable coverage post-accident with accident forgiveness and discounts.
Research shows that the annual cost of car insurance increases an average of 46%, or $1,157, after an accident with a bodily injury claim. This number varies depending on your state. Michigan has the most expensive increase in rates, with an average increase of 105% post-accident. The opposite is true in Kansas, where an accident only increases your insurance rate by an average of 8%.
If you’re not found at fault for an accident, your rates probably won’t increase, but some insurance companies still raise their rates even if you’re not the at-fault driver.
Why Does Car Insurance Increase After an Accident?
Your insurance company takes your driving record into account while creating your policy. If you’ve recently been involved in an accident, your insurer thinks you’re more likely to file a future claim than a driver with a clean record. Drivers who pose a greater financial risk to their insurer are usually charged more for premiums to negate the risk.
What Is Accident Forgiveness
Accident forgiveness is a feature you can add to your policy with some insurers to prevent a rate increase after an accident. If your insurance company offers accident forgiveness and you add it to your policy, when you get into a collision, you may lose your accident-free discount, but your policyholder will not penalize you for being in an accident. The qualifications for accident forgiveness vary based on your insurer, but most companies require you to maintain a clean driving record for a few years before adding accident forgiveness to your policy. Accident forgiveness can also be used if the other driver involved is uninsured. You might want to add it to your policy if you’re an inexperienced driver worried about a premium increase, or the parent of a teenage driver on your car insurance.
If you have accident forgiveness and get into an accident, that accident will still be on your driving record. If you switch to a different insurance company after the accident, you might see your rates go up. In addition, accident forgiveness typically only applies to one at-fault accident, and any subsequent accidents can increase your rate.
How Can I Lower My Insurance Rate After an Accident?
If you don’t have accident forgiveness and get into an accident, there are still ways to keep your insurance policy affordable:
- Add a discount. Check with your insurer to see what discounts they offer, such as low annual mileage or multiple car discounts. You might also get discounts for keeping your record clean or taking a defensive driving course.
- Increase your deductible. A higher deductible will lower your premium because you’ll be paying more out-of-pocket expenses if you get into an accident.
- Compare rates. See which insurers are offering the best rates for high-risk drivers.
The General specializes in affordable coverage for drivers with imperfect records. We even offer discounts for keeping your record clean over time. Get a free quote in two minutes or less or explore more of our blog posts.