Tips To Prevent Insurance Increases After a Car Accident

Some ways to prevent an insurance increase after an accident include taking advantage of an accident forgiveness benefit, providing detailed evidence to establish that you aren’t at fault or declining to file a claim for a minor no-fault accident. Car insurance premiums go up by an average of 34% to 44% after an at-fault car accident, and they could rise by around 5% to 17% after an accident you aren’t responsible for, depending on your state and insurer, so it’s crucial to be proactive about seeking out ways to lower your insurance costs after a crash.^[1][2]

Read below for several post-accident insurance tips that can help you know how to reduce insurance premiums after accidents.

How To Prevent an Insurance Increase After an Accident

See the following sections for specific guidance on how to keep your car insurance rates manageable following a car accident.

1. Find Out if Your Insurance Policy Has Accident Forgiveness

If your car insurance policy includes accident forgiveness, then your insurance company should automatically waive the rate hike you would typically experience after an at-fault car accident. You may be able to purchase accident forgiveness as a car insurance add-on, or you may qualify for it for free after meeting certain eligibility criteria.

For example, GEICO automatically offers no-cost accident forgiveness coverage to drivers over the age of 21 who go at least five years without getting into an accident. That said, GEICO will inform you before adding accident forgiveness to your policy, so you should generally know whether your policy already includes it.^[3]

You should consider adding accident forgiveness to your policy before getting into an accident if you don’t already have it. Even when it comes to paid accident forgiveness coverage, you may not be eligible unless you have had an accident-free driving record for the past several years, so this option likely won’t be available for a while once you do get into an accident.

2. Report the Accident in an Honest Manner

While you may be hesitant to tell your insurer about an at-fault accident since you know it will cause your rates to go up, it will likely be far more costly to lie about the crash. Intentionally misrepresenting the facts of an accident is considered insurance fraud and could result in higher premiums, claim denials or even the cancellation of your policy. Having your policy canceled could be particularly detrimental because it creates a coverage lapse that will cause you to encounter higher premiums when you buy a policy from another insurance provider.

3. Avoid Filing Small Claims

You should avoid filing a claim on your auto insurance policy unless you absolutely have to since auto insurance companies will likely view you as high risk if you file multiple car insurance claims within the span of a few years. Being labeled a high-risk driver could lead to higher rates or make it harder for you to find coverage.

As a general rule of thumb, you should not file a claim on your comprehensive or collision insurance unless the cost to repair your vehicle is far higher than your deductible, which is the minimum amount of money you are personally responsible for contributing toward a covered claim.

For example, if you have a $500 collision insurance deductible and it would cost you $600 to have your back bumper replaced after backing into a tree, you should probably cover the entire cost of repairs out of pocket instead of going through your insurance, because the immediate $100 savings may be quickly undone by the subsequent rate increase due to filing a claim.

4. Take Defensive Driving Courses

Although enrolling in a defensive driving course may not necessarily prevent a car insurance increase after an accident, it may lead to a discount that can partially offset the increase. However, you should keep in mind that not everyone is eligible for a defensive driving discount from every car insurance company.

For example, Nationwide allows certain policyholders to lower their car insurance rates by about 5% by taking a state-approved accident prevention course, but you can only qualify for the discount if you are at least 55 years old and have gone about three years without getting into an at-fault accident.^[4]

5. Negotiate With Your Insurance Company

You may be able to negotiate with your insurer to avoid a substantial rate hike after a collision, especially if it is unclear who is responsible for the accident. If you believe the other driver is primarily at fault, you should collect evidence that supports your claim to present to your insurance carrier and consider enlisting the help of an attorney, if necessary.

6. Increase Your Deductible

Another way to neutralize the rate increase after getting into an accident is to raise your deductible. Doing so will leave you on the hook for a greater portion of the costs whenever you file a claim. In exchange, you will get to spend less on your monthly premium payments, which may be more cost-effective in the long run as long as you always have enough money saved up to cover your deductible in case you get into another accident.

7. Maintain a Clean Driving Record After the Accident

Car accidents usually continue to impact your insurance prices for three to five years, meaning your rates should start to come back down within a few years of getting into an accident as long as you aren’t involved in any other collisions.^[5] For additional savings, you could enroll in a telematics program that tracks your driving and rewards safe practices with a discount. Of course, you should be aware that this could instead result in higher rates if you don’t drive safely.

How To File a Claim After a Car Accident

Anytime you are involved in a car accident, you should take the following steps to file a car insurance claim:

1. Call 911 so that anyone who is injured can be treated and the responding officers can complete a police report.
2. Share your contact information with others involved in the accident and document the accident scene by taking pictures or filming videos.
3. Contact your insurance carrier via phone, mobile app or online portal, and provide information to support your claim, including pictures and police reports.
4. Check your policy’s coverage limit and deductible, if applicable, to get an idea of how much money you should receive in your insurance settlement.
5. Ask a local repair shop for an estimate of how much it will cost to fix your car.
6. If the insurance payout is appropriate, accept the settlement and use the money to get your vehicle repaired.