Help! I Was in an Accident, How Does That Affect My Car Insurance?
Ideally, before someone is involved in an accident, they are well-versed in what to do when it comes to insurance after the accident. What one may not know, however, is how being involved in an accident affects his or her insurance policy. Even under optimal driving conditions, accidents can and do happen. When an accident happens, what will happen to your car insurance?
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Was it No-Fault?
If there was no fault determined in the accident, or if reports show that the accident was the fault of the other party, it is rare that premiums will be affected. On the other hand, being at fault for an accident can cause premiums to rise – and can even cause a policyholder to lose any good driver discount he or she may be receiving. The fault also depends on how many cars were involved. It is important that those in an accident file a police report – as the police report can absolve guilt and determine which party is as fault. For incidents involving a single car, unless there was debris or an animal in the road, the driver tends to be at fault. Sometimes, fault is ascribed to both drivers, in which case both insurance policies may go up.
How Much Damage Was There?
If there was major damage, expect the premiums on car insurance rates to increase. When damage is small, you may get away without a significant premium increase, but if the damage is substantial, the premiums go up as well – after all, the insurance company needs to account for the risk involved in covering policyholders.
Were Alcohol or Drugs Involved?
If alcohol or drugs were involved, there will be serious repercussions both legally and in terms of your car insurance. In addition to fines, rehabilitation classes, and possible prison time, if drugs or alcohol were involved, then expect premiums to go through the roof – if the insurance company doesn’t decline to renew.
Were There Injuries?
If there were no injuries, even if one is determined to be at fault, then there may not be as big an impact on insurance policies. If there are injuries, however, you can expect your premiums to increase—especially if the injuries are serious and you were at fault. Forget about insurance if there was a DUI and an injury. If you can still buy insurance afterwards, it is very likely the premiums will be through the roof.
Was This the First or Third Accident?
If it was the first accident you’ve been in, then the repercussions are less likely to be too steep, especially if you were determined to not be at fault. On the other hand, if you’ve been in multiple accidents in a short period, you should expect to see your premiums rise. Again, insurance rates are based upon the level of perceived risk.
How Long Will Your Accident Affect Your Insurance Premiums?
Typically, accidents remain on your record for three years following the time the claim was filed. That means if you were in an accident today, three years from now, the accident should no longer be on your driving record. If you only have one accident in this three-year period, then you shouldn’t worry too much; on the other hand, if you have multiple accidents, brace yourself. Not only may your premiums increase, but you may also become uninsurable.
This article contains general advice about car insurance. The author has not taken into account your financial situation or needs and you should consider whether the advice provided is appropriate for your own circumstances before relying on it.
Filed Under: Car Insurance
