How Many Claims Are Allowed in Car Insurance?
While there aren’t limits to how many claims you can file, you risk getting dropped by your provider if you file too many in a given period of time. Along with the possibility of being dropped, your rates will most likely increase usually for the next three years. This is especially true if you are at fault for an accident. Those who live in an “at-fault” state are required to pay medical and repair expenses for those they injure and property they damage in a car accident, either on their own or through their auto policy. Those in a “no-fault” state are required to cover their own expenses through personal injury protection (PIP), regardless of who is at fault. You can save on your insurance by taking advantage of discounts, raising your deductible and by shopping for coverage elsewhere.
If you’ve filed multiple claims with your provider or you’ve been in an accident, keep reading to see what changes to expect from your insurance and how to save when your rates go up.
Can You Have Multiple Claims in Car Insurance?
You can file multiple car insurance claims, but should avoid doing so. If there are multiple claims on a single policy, your rates will most likely go up, which will cause you to pay more for coverage for up to three years. This could include drivers who were not at fault for an accident, depending on the insurance provider and where they live. Your insurer will likely not cancel your policy mid-term for having multiple claims, but they may decide not to renew your policy.
At-Fault Vs No-Fault Claims
Most states require the driver who caused an accident to pay for the injuries another party may have sustained with the “at-fault” driver’s liability coverage. There are other states that are referred to as “no-fault” states, where individual drivers are responsible for their own medical expenses through their personal injury protection (PIP) regardless of who caused the accident. Below is a breakdown of how your insurance is affected if you’re in an at-fault accident or a no-fault accident.
- At-fault accidents - Your adjuster will likely raise your rates if you cause an accident. If you live in an at-fault state, your liability coverage will pay for the medical expenses and repair costs of anyone who was harmed due to your actions. You can get additional coverage from Med Pay which will cover medical and funeral expenses for you and your drivers regardless of who is at fault. If you’re in an accident that isn’t your fault, the at-fault driver’s insurance will pay for your medical and repair costs.
- No-fault accidents - Your insurance rates will most likely go up if you’re in an accident in a no-fault state. If you live in a no-fault state, you will be required to cover your own medical expenses, childcare, grocery delivery fees or lost income through your PIP, which isrequired in:
- New Jersey
- New York
- North Dakota
What is a Comprehensive Insurance Claim?
A comprehensive insurance claim is made when something causes harm to your vehicle that is not a collision. Comprehensive claims include fires, falling objects, explosions, earthquakes, windstorms, hail, floods, vandalism, riots and collisions with animals. The number of years a comprehensive claim stays on your record varies by state and may cause your insurance rates to rise. However, if your rates do go up, it will likely be less than if you had an at-fault accident.
How To Avoid Multiple Insurance Claim Penalties
There are steps you can take to avoid multiple claim penalties, including:
- Driving with caution - Driving with caution is the best way to make sure you don’t find yourself in an accident. Your rates will go up the most if you’re the one causing the damage. Don’t be distracted, avoid driving when the weather is bad, store your vehicle in a garage, and keep your vehicle in good condition.
- Paying out-of-pocket for claims - Sometimes you can save more money by not filing a claim if your deductible is higher than the cost of repair to your vehicle. Also, insurance providers look at the number of claims in a given amount of time when assessing if someone’s rates should go up and by how much. If you file several claims in close proximity to another one, your rates will rise, causing you to pay more for coverage.
Your provider won’t necessarily cancel your claim mid-term if you file several claims, but they may choose not to renew your policy depending on the number of claims and the severity of the accidents.
How Does a Collision Claim Impact My Insurance Rate?
A collision claim will cause your rates to go up. The rate increase will vary from one insurance company to another and generally lasts up to three years. The reason for the increase is that your insurance provider will see you as a higher risk. This change in your rates could occur even if you didn't cause the accident. The rate increase you will likely receive is what’s known as a surcharge, a penalty added to your premium. Rates are adjusted based on the following factors:
- How many claims you filed in a given timeframe
- How severe the accidents were in a given timeframe
- The total amount of claims filed against your policy
It is possible to avoid a rate increase even if you were at fault for the accident by having accident forgiveness coverage, which can be purchased separately as part of your auto insurance policy or it can be awarded to safe drivers for free. Having this coverage means your rates will remain the same after your first at-fault accident. After that, your rates will likely increase.
How Many Claims Can You File in a Year?
There is no limit to how many claims you can file in a year. However, depending on the number of accidents you’ve been in, along with other factors, your insurance company may put you into a non-standard tier of insurance. This identifies you as a higher risk driver. Qualification for driving tiers is based on the insurance company you’re working with. If this happens, you may not be able to get coverage from your current provider or other traditional insurance carriers. You would instead need to seek coverage from a non-standard insurance company, which includes:
- Bristol West
- Direct Auto Insurance
- Founders Insurance
- The General
- Kemper Auto Insurance
- National General
- Safe Auto
As a high-risk driver your rates will be higher. Luckily, you can move out of the non-standard tier over time. Make sure you take precautions when behind the wheel. This will mitigate more accidents.
Additionally, look into attending a drivers safety course because many insurance companies will reward this behavior and you may even have points taken off your license.
How To Save on Car Insurance After a Claim
There are several things you can do to help lower rates after a claim has been filed, such as:
- Getting discounts - Automotive discounts are one of the easiest ways to lower your insurance rates. They will vary depending on your situation and your insurance provider. Discounts may include:
- Anti-theft discount - Insurance companies may offer a discount if the vehicle being insured has anti-theft devices installed.
- Automatic payment discount - Insurance companies may provide a discount for customers who have their premium payments set up on autopay.
- Bundling insurance discount - Bundling your car and your home insurance will save you money in most cases.
- Defensive driving discount - Discounts can be available for drivers who attend a defensive driving course.
- Distant student discount - There are insurance carriers who will offer auto discounts for those who have students attending college at least 100 miles away.
- Good student discount - If you are a student who has good grades, you may qualify for this discount. Requirements vary from one provider to another.
- Low-mileage discount - Your insurance company may give you a discount for driving less.
- Loyalty discount - Some insurance companies reward long-term customers with a discount.
- Military/Veteran discount - Discounts are often available for those who are either active duty military or who are veterans.
- Multi-car discount - Many insurance companies offer discounts for customers who have multiple cars listed on their policy.
- New vehicle discount - Depending on how new your vehicle is, you could qualify for a discount.
- Organizational discount - If you belong to a certain club, employer, university or other organization, you could qualify for an auto discount.
- Paperless discount - Discounts are often available if you opt-in for paperless mail from your carrier.
- Pay-in-full discount - Discounts are usually available for customers who pay their yearly premium in full.
- Profession-based discount - Some insurance companies will offer discounts for customers depending on their job.
- Telematics discount - Insurance providers may give discounts to those who allow their driving data to be collected by carriers. Driving behaviors are tracked with good behavior being rewarded.
- Comparing insurance options - It’s a good idea to shop around for coverage every six months so you can see if you can get better rates from another provider. The cost of insurance will differ from one provider to another, with each one taking a slightly different look at your driving history. While your rates will continue to remain higher after filing multiple claims, you can still find cheaper insurance elsewhere.
- Raising your deductible - Your premium is partially based on the deductible you choose to pay. Your deductible is the up-front amount you pay out-of-pocket before your insurance kicks in. The higher the deductible, the lower the premium. If you want to save on your premium, raise your deductible, but only if you can pay if you need repairs after an accident.
If you need to find new coverage so you can get better rates after filing multiple auto claims, enter your zip code below or call 855.214.2291 to receive free auto insurance quotes from agents in your area offering the lowest rates.