Accidents and traffic violations affect your car insurance rates in a negative way. The insurance providers consider you as high risk and increase your premiums. It is worthwhile to take precautions, so that you can avoid accidents and enjoy cheap car insurance rates.
You might have spent months in search of the perfect auto insurance policy for your beloved vehicle. You get involved in an accident, and all your previous efforts go in vain. It is because the rates on an auto insurance policy soar up after every accident.
However, accidents are unpredictable and don’t follow a particular path. The increase in the rates is different each time an accident takes place. The rate hike on your auto insurance policy depends on the number of times you had been involved in accidents. After your first accident, the rates will presumably increase by 10 percent, whereas the second one enhances it by 30 percent more. After the third accident, the rates will soar up by around 50 percent, turning your cheap car insurance into an expensive one. Read along to know how accidents affect the rates on your auto insurance policy.
How accidents influence your auto insurance rates
The costs on your cheap car insurance will rise in the following ways, post accidents or traffic violations:
1. Multiple claims – Your auto insurance rates will supposedly increase as a claim is filed, following an accident. Though a single claim doesn’t affect the rates much, multiple accident claims within the same policy period is bound to enhance your auto insurance rates.
2. Driver at fault – The insurers try to find out which driver was responsible for the accident. If you had been at fault, your insurance rates are going to increase subsequently. The driver, deemed as not-at-fault, will enjoy lower premium payments.
3. Accidents causing bodily injury – Bodily injuries result in a lot of expenses, which your insurer has to pay. Thus, a bodily injury claim will evidently affect your auto insurance rates. The insurance company will take into account the severity of the injury, as well as the required medical costs for its treatment, before raising the premiums.
4. Traffic violations – On-site investigations take place before your insurer settles your claims. If you are found guilty of flouting traffic laws, your insurance providers are going to raise your premium rates. DUI, speeding tickets and other traffic violations will make you appear as a high risk driver before your insurance provider, and consequently your rates are going to increase.
5. Cancellation of discounts – You might have taken advantage of discounts while buying your cheap car insurance policy. Traffic violations, accidents and multiple claims will make your insurance provider cancel or reduce the discounts and rebates. As a result, the costs on your insurance policies are going to rise.
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