Many people wonder if they make a claim with their auto insurance, will it affect their premiums? The fact is, claims made against your comprehensive coverage should not raise your auto insurance rates. However, claims against your collision insurance can raise your premiums, and depending on the severity of the claim, they can go up significantly, or your auto insurance company can even decline to renew your insurance when it comes time to do so.
What Does Collision Insurance Cover?
Collision insurance basically covers you for damage and injury that result from an auto accident of some kind. Collision insurance is the kind of insurance that most states require drivers to have.
What To Do After an Accident
The first thing to do after you have been involved in an auto accident of some kind is to let your auto insurance agent know. They will assign your case to an auto insurance claims adjuster, who will assess the damage and let you know what the insurance company is going to pay. They generally do this by getting a copy of the police report and coming to look at your vehicle. They will most likely take pictures of the damage and ask you some questions about the accident.
How Does the Insurance Company Decide to Raise Your Rates?
There are a number of issues at stake when it comes to the auto insurance company deciding if they should raise your premiums after an accident. The best case scenario is that the accident was not your fault, and your insurance company is able to recoup their losses from the other person’s insurance company. Generally, your auto insurance company will not raise your rates for an accident such as this.
However, if the accident was your fault, you might see an increase in your auto insurance premiums up to as much as 20% more than you are paying now. Of course, this depends again on the severity of the accident. If you were just in some kind of fender bender in which the damage estimate was less than $2,000, you might see only a small increase in your auto insurance rates. But if you were the cause of a multiple vehicle accident, you will probably not get your auto insurance renewed. So if your accident is somewhere in the middle of smallest to largest, you will most likely see a corresponding rise in your auto insurance rates.
Accidents and Accident Forgiveness
Some auto insurance companies will forgive you for one small accident, because if you are a good customer and don’t make claims, they understand that one small accident can happen to anyone. On the other hand, if you are involved in accidents regularly, and make claims to your auto insurance company regularly, you will find yourself having a hard time keeping auto insurance. You can even be cancelled by your auto insurance company if you are a person who makes multiple claims.
The bottom line is that if you are a safe driver who very rarely gets into accidents or makes insurance claims, you can expect to have good rates.
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