Most people realize that they will see an increase in their insurance premiums after an at-fault accident. Often, these rate increases are quite steep. How much of an increase an at-fault accident will cause depends on the insurance laws in the state where you reside.
What many people do not realize, however, is that being involved in an accident that isn’t your fault will also increase your insurance premium, though not as much as would an at-fault accident. Read on for more information about insurance rates and why they increase after an accident, even when you were not the one who caused the accident.
Factors That Cause Insurance Rates to Go up When You’re Not At-Fault
Insurance premiums may increase up to 73 percent after a single at-fault accident. Regarding not-at-fault accidents, a recent insurance analysis conducted by The Zebra revealed that insurance premiums after such an accident can increase by more than $100 a year. These increases are applied when your policy renews.
Some of the factors that can increase what you pay for insurance include:
- The at-fault party’s level of insurance coverage. If the individual who caused your accident does not have insurance or does not have a policy large enough to pay out your claim, your own insurance company could be on the hook for your expenses through your uninsured/underinsured motorist policy.
- Partial fault in the accident. Determining liability after a car accident is not always easy. In fact, many accidents result from the careless actions of multiple parties. If you were at all at-fault—even if the other driver was more at fault than you—you can expect your insurance premiums to increase. However, Nevada is an at-fault or tort State, whereby an individual can bring a legal claim against anyone recognized as the party at fault for the accident, regardless of damages; in other words, determining the at-fault party after an accident is off the essence to making a legal claim.
- You have been in other not-at-fault accidents in the past. All accidents that are reported to the police are also reported on your driving record, regardless of whether you were at fault. Even if all of your accidents were caused by someone else’s careless or reckless actions, the appearance of those accidents on your record could cause your insurance company to determine that you are high-risk and result in an increase in your premiums.
- Failing to report the accident to your insurance carrier. Even if you do not file a claim with your insurance company, you are likely required to report the accident. Most insurance companies include this requirement in the policy contract that you signed when you purchased your policy. If the accident involved a police report, chances are that your insurance company will learn about it anyway, and its response could be even worse than increased rates. It could drop your policy altogether for breach of contract.
Not all insurance companies include a surcharge in the policy renewal for not-at-fault accidents. If your insurance carrier does, you might want to look around to see if you can find a different company. If you are soliciting quotes from different companies, be sure to ask them if they add a surcharge for not-at-fault accidents.
Certain not-at-fault accidents rarely will result in a surcharge, including those that involve your car being damaged while it is legally parked, those that were caused by a collision with an animal, or if there is a court judgment against the person who caused the damage.
Proving You Weren’t At-Fault
Because the surcharge that results in higher premiums is much costlier with at-fault accidents, and because this surcharge could last for three to five years, tell your insurance company that you were not at fault.
Prove your innocence by offering:
- An official police report stating that another driver was at fault. The police department in the locality where your accident occurred can tell you how to obtain a copy of the report.
- A statement from the other driver’s insurance company stating that its insured was liable.
- A legal document stating that you were reimbursed for your damages.
- The at-fault driver’s written and sworn statement attesting to his or her fault.
Retain a copy of any or all of these documents for your own records. If the at-fault party’s insurance company fails to pay for the damages you incurred in the accident, particularly if you suffered an injury as a result of that accident, any documentation that proves liability will be useful if you file a car accident lawsuit.
Ways to Avoid Paying More for Insurance After a Not-At-Fault Accident
If you are facing increased premiums after your not-at-fault accident, there are some things you can do to reduce your rates.
These tips include:
- Finding an insurance carrier who does not increase your rates after a not-at-fault accident.
- Ask your insurance carrier if it has an accident forgiveness practice. Many insurance companies that participate in this practice will forgive one at-fault accident per policy after a certain amount of time without any moving violations or accidents. Even though you likely do not want to use this on the not-at-fault accident, remember that all of your accidents for three to five years will be on your motor vehicle record. Accident forgiveness can, in some cases, prevent the insurance company from classifying you as a high-risk driver.
- Consider increasing your deductible. The higher the deductible, the lower the premium. The lower the deductible, the higher the premium. If you are subject to a surcharge that increases your premium, the higher deductible can help to place your premium closer to where it was before the accident.
- Do not file insurance claims for small things. One of the main factors an insurance company will consider when setting a driver’s premium is how much financial risk this person will place on the company. The more claims you file, the more payouts the insurance provider must pay.