Unfortunately, there’s no way around it. If you get in a car accident – and you are the one who’s to blame (or mostly to blame) for that accident – you car insurance rates are going up.
If you’ve been in an accident, then you might be worried about exactly how much your rates will go up and if there’s anything you can do to keep them from going up too much. If you are worried about those things, then let’s explore them a bit to see if you really should be worried.
Increase in Insurance Rates
Let’s start by looking at how much your insurance premiums will go up after a car wreck.
In the US, reports show that the average increase of car insurance premiums after an accident is 34%. This is in a situation where the driver has had one accident that they caused and there was property damage of over $2000.
This national average, however, can be a bit deceptive. Because the amount can range from around 10% to almost 90% depending on what state you’re in. So let’s dig a little deeper here and look at the specific averages for several states.
Sorry Californians (And Those of You in Minnesota and Louisiana)
Drivers in these three states can expect to have an increase in insurance rates of 50% or more according to the data at Carinsurance.com. Minnesota leads the way, with their drivers looking at an almost 90% (that’s close to doubling!) of insurance rates after an accident. California is next at around a 73% increase. And, if you’re in Louisiana, you can expect an increase of 50% (which, compared to the other two, almost sounds reasonable!).
Count Your Lucky Stars New Yorkers
You may be surprised to find out that residents of New York will experience the lowest average increase in insurance rates after an accident. In the Empire State, rates average an increase of a little over 10% after an accident. Those in Hawaii and South Carolina can also expect increases of less than 15%.
How Long Will An Accident Affect Insurance Premium Rates?
Okay, so your rates go up, but for how long will you be paying those higher rates? Car insurance companies usually review each case on its own merit.
How many accidents you’ve had in the past, how bad the accident(s) were and other factor determine how long you’ll be paying higher insurance rates.
That said, a good average is that your rates will stay higher for 3 years. And, during those three years, they will gradually drop (assuming you don’t have any further accidents).
Is An Insurance Premium Increase Avoidable?
The short answer is probably not. Though there are things you can do to try to keep the rate hike as small as possible.
- Stay accident free after the accident. Well, duh. Obviously! Yes, we know this is not totally in your control and you’re (hopefully) not out there trying to get into accidents. That said, if you try to be a more careful driver and not get any additional tickets/accidents, the quicker your rates will go down.
- Ask your insurance company about customer loyalty plans. If you’ve had a long driving history with no major accidents, your company may listen and consider reducing your new premiums. The severity of the accident you have caused and the state that you’re insured in will play into this.
- Increase your deductibles which will mean lower premiums each month.
- Switch insurance companies. If your insurer is adamant about the higher rates, consider switching companies. You might be able to get a lower rate from someone else. Different companies charge different premiums for the same insurer/driving record. So it pays to shop around.
- Take a defensive driving class. Yes, depending on your instructor, this might be mind-numbingly boring. But in some states, taking a driving course could take some points off your driving record. And that can lower your insurance premiums.
If you get in an accident, yes, expect your insurance premiums to go up. How much and how long they go up depends on the factors mentioned above. And, as you can see, there are some things you can do to keep those rates down so don’t despair!