How Does An Auto Accident Affect Your Insurance Policy?

Do traffic tickets increase insurance premiums
An online shopping site did a survey and found out that getting a ticket does not automatically mean higher insurance rates. According to InsuranceQuotes.com, who conducted the survey, 31% said they had both a violation in the past five years and higher auto insurance premiums as a result. The Insurance Information Institute doesn’t necessarily agree with the survey. They stated that there are several things that go into the premium, not just tickets. Most people don't pay more after a ticket because insurers don't spend the time or money tracking every customer's driving record, according to one analyst at InsuranceQuotes.com.

Related: What Are The Different Types Of Insurance Coverage

How do auto accidents affect insurance rates?
Auto accidents are a different story. According to the Independent Insurance Agents and Brokers of America, at-fault accidents can remain on your record for six to 48 months, which could result in higher premiums. If you have three or more at-fault accidents or violations within a 24-36 month period, your insurance company may not renew your policy.

Insurance penalties
The penalties will always vary from one insurer to the next, but the penalties could rise. In the case of State Farm, if you go at least 10 years without a chargeable claim, there’s no effect on your premium. They also go on to state that if you have an accident within the first year of your policy, you can expect to see a higher cost of liability insurance, which on average is 40% of your premium. Your cost of personal injury and collision will likely also rise. The first time, the cost of all three types of coverage will go up 10%. The second time, it will go up an additional 30%. Finally, the third time, coverage will increase by an additional 50%. So, after the third accident, the cumulative increase in the cost of liability, personal injury and collision insurance will be 90%.

Related: Eight Common Discounts Offered By Car Insurance Companies

As you can see, car insurance can get pricy. However, it is necessary to have car insurance so you are covered if you’re ever in an accident. Another way that will help keep your cost down, is to avoid being in an accident. We don’t control other drivers, but we can control our own actions. So, drive sober, drug-free and always focus on the road.

Michael Schafer
The Personal Injury Attorney for Louisville and Kentucky
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