When you have a car accident, your first thought probably isn’t about your car insurance. You may wonder about your safety, the damage, and exactly how it happened. But the auto insurance part will come later. Because if you were the person who caused the incident, then you could be penalized—for years to come. Exactly how do insurance companies figure out how much to raise your rates? And how long will the increase last? Well, today we’ll shed some light on this subject.
It Varies from State to State
Every state seems to have its own rules for dealing with car accidents. Both in determining fault and how we handle things from an insurance standpoint. In many places, it’s only the person who caused the accident who will see an increase afterward. If you’re just involved, you’ll typically make a claim again the other driver’s insurance, leaving your rates unaffected. Still, some states have no-fault rules that require both drivers to file with their own insurance companies after a collision. It’s designed to limit liability and cut down on civil suits following car accidents. Overall, it’s meant to lower the cost of coverage, but you’re then required to carry additional personal injury protection (PIP).
Ultimately, what state you live in will also determine how much of an increase you’ll see. In some states, it’s a minimal rise spread out over the course of a year. In other states, it could double, or even triple your costs. In Maryland, we typically fall somewhere in the middle. Being neither the most expensive place to have an accident, nor the least. But, it’s always better to avoid paying more, if you can, since you’ll feel the effects for 3 to 5 years afterward.
And It’s Not Just Accidents
Did you know speeding tickets can raise your rates, too? They move you into a riskier class of drivers, increasing your annual premium even after you pay the fine. While it may be minimal for your first offense, as well as for tickets only 6 to 10 mph over the limit, expect that to go up if you’re caught again. The more tickets you have, the more you’re likely to see your insurance rates raise. Even one can drastically affect your pricing if it was severely over the posted speed. Again, which state you live in will, in part, determine what effect you’ll see. But it can cost just as much as accidents in the long run.
If you have an accident or speeding ticket on your record, let us know! We’re happy to help you navigate the resulting insurance changes. Since we’re brokers here at The Freedom Insurance Agency, Inc., we can even shop around the see which carriers will offer the lowest increase. Not to mention, we can let you know how long these incidences will affect your premium. Remember, we’re on your side! Let us show you how.