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Claims That Boost Insurance Rates

Learn What Claims That Boost Your Insurance Rates

Many drivers become hesitant to file claims with their auto insurance provider because they fear that their rates will skyrocket as a result. It might appear on the surface that your claim was the key factor for an automatic rate increase, but the fact of the matter is that your insurance company will raise rates based on the company itself, the circumstances of that incident, and whether or not you currently have accident forgiveness on the policy. The following different types of auto claims that boost insurance rates will help you to better understand what is happening.

Accident Specifics Affecting Your Rates


There are many factors that your automobile insurance company will consider when determining how the accident affects your insurance rates. The first thing the insurance company will look at when you file a claim is the severity of that accident. Damage to your vehicle can range from scratches to the paint to your vehicle being totaled. The more damage to your vehicle, the greater boost you can expect to your insurance rates. One of the auto claims that boost insurance rates is the at-fault driver claim. If you were responsible for the crash, your rate will certainly increase.

Reading Your Insurance Policy More Closely


Although it is a foregone conclusion your insurance premiums will likely soar if you are the cause of the accident, there are other things to consider that will impact your rates. That being said, you might assume that if the other driver was at fault that your premiums will stay the same, this is not always the case. Many automobile insurance companies will in fact increase your premiums just because now you are statistically more likely to have another accident, so you then pose more of a risk to that insurance company. Additionally, if you live in a state that is considered no-fault, then both of the insurance companies foot the bill and you will see an increase in your premiums regardless who caused the accident.

Your Value to Your Insurance Company


Just like loyalty programs with other types of business, the longer you have conducted business with a company, the more likely they are to do whatever it takes to keep you happy. The same goes for auto insurance companies, your time with the company will affect your rates. If you file any type claim after being with the company a short time, they will certainly boost the rates. If you have a poor driving history, that will also play into the decision to raise your rates regardless the severity of your claim. Good drivers are rewarded with accident forgiveness benefits, so even your first accident will not have a negative impact on your rates if you can maintain a period with a clean driving record.

Other things to consider that could negatively impact your insurance rates are living in a high-crime area. Here you are more likely to file claims, so your insurance company is going to pass those costs on to you. Higher risk areas mean higher insurance rates after any claim. Talk with your insurance agent or take the time to shop around with other providers because not every increase is permanent. Many insurance companies will automatically raise your premiums after any claim for a trial period, then drop the rate each period that you go without filing any claims.