When car accidents occur, they not only cause harm and damage to you and your vehicle but also affect your insurance policy. Most insurance companies often raise premium rates if you are involved in an accident. Have you been recently involved in an accident and are worried that your insurance premiums will rise? Worry no more. This article outlines how to lower car insurance after an accident.
6 Tips To Reduce Car Insurance After an Accident
Here are a few ways to reduce the impact of an accident on your car’s insurance premiums.
1. Ask Your Insurer About an Accident Forgiveness Clause
Accidents are inevitable, and some auto insurance companies recognize this by offering accident forgiveness. However, the conditions qualifying one for accident forgiveness vary from one insurance company to another. Some companies offer accident forgiveness immediately after taking a policy with them. Others do it after being an accident-free policyholder for about three to five years.
Therefore, it is advisable to reach out to your insurance provider as soon as you are involved in an accident to help you know your qualifying conditions.
2. Shop Around for a Better Policy
If you are not content with your premium increment after an accident, feel free to shop around for a better policy. However, it is important to note that your rates will be relatively high following the accident on your driving record. Other factors, such as your car’s make or model, your age, and your driving history, determine your premiums.
There are many car insurance service providers offering premiums at different rates. Therefore, it is advisable to get quotes from various insurance providers to help you compare their coverage and rates. Go for the one with the most competitive policy.
3. Increase Your Deductible
Did you know that your deductible has a direct impact on your premiums? The higher the deductible amount, the lower the premium.
If your insurance company increases your premium after an accident, you can lower the rates by raising your deductible. Deductible refers to the amount you will pay after filing an insurance claim. It is often deducted from the total claim payment. You may increase your deductible and get a policy from a different company or stick to your current insurer. Whichever case works best for you.
However, before increasing your deductible, it is essential to ask yourself whether you will have that extra amount to spend if you got into an accident. This move requires critical thinking and sound financial planning.
4. Take a Driving Course
Another way of lowering your premium rates after an accident is taking a refresher course. Getting back to class to refresh your mind shows that you are looking to improve your driving skills. As a result, your insurer might consider lowering your rates during your premium renewal.
5. Take Advantage of Insurance Discounts
Insurance discounts go a long way in lowering your premium. Different companies offer varying discounts to their clients, such as military, student, multiple cars, and new driver discounts. Therefore, it is advisable to talk to your insurance provider to find your qualifying discount category. Additionally, this may be the ideal time to ask for a discount if you have been a long term customer.
6. Drop Your Comprehensive Coverage
You may also consider dropping your comprehensive insurance cover to lower your increased premiums. Comprehensive insurance covers all non-collision damages that are out of your control. They include damages caused by rain, storm, or theft and often adds to your insurance premiums.
However, dropping this cover may expose you to huge costs if theft or a natural disaster occurs. Therefore, it is ideal for old vehicles with a low value. Having learned a few tips on lowering your car insurance, below are some frequently asked questions that might be helpful.
Can You Negotiate with the Insurer?
Legally, car insurance is not open for negotiations. Insurance companies follow strict laid-down guidelines when determining your premiums, such as your car’s model, cost, your driving history, and desired coverage. With the laid down procedures, insurance companies can set their prices based on certain perceived risks. Therefore, given that the risk factors are predetermined, the insurance providers do not have the flexibility to adjust prices as per negotiations.
Can you shop around? Will it be difficult to get a cheaper rate because the insurers will see that you’ve been in an accident recently?
Yes, you can shop around for a cheaper insurance company after an accident. Having an accident incident in your driving record does not make it hard for you to get a more reasonable policy from the many insurers available in the market. It is still possible to get an affordable insurance cover.
Why Do Your Rates Go Up After an Accident?
Your rates are likely to go up as a reflection of your new data on an accident. Insurance companies raise your rates because they now know you are capable of causing accidents and thus perceive you as a risky driver.
Does it matter who’s fault the accident was?
Yes, it matters who is at fault as it helps with the claim payment. If you appear to be at fault, your insurance provider is likely to increase your rates.
How much can you expect your rates to go up after an accident? Is it a set amount that is stated in your contract?
The rate at which the premium rises varies depending on your location and the severity of your accident. Most states have an average rate increase chart that most insurance providers use to determine your premium increment. It is also available to you when taking a policy contract. Therefore, it is important to be conversant with your region’s rates to know what to expect after an accident.
At what point will your rates come down?
On average, most accident incidents remain on your driving record for about three to five years. Within this period, your insurer will factor in the accident when determining your premium. Therefore, your rates are likely to come down again after approximately three to five years. However, this period may vary depending on the severity of the accident and your locality, among other prevailing conditions.
Car accidents are not good for your insurance policy; they are likely to cause a rise in your premiums. However, you can reduce your rates by increasing your deductible, shopping around for a cheaper policy, and asking for accident forgiveness.
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