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How Much Can Your Auto Insurance Rate Increase After One Accident?

All of you must have heard about insurance rate increasing after an accident. We believe that the information given below will be rather useful for any driver, even a very careful one.

First of all, remember that your insurance rate may not go up until the renewal time comes around (for example, the accident happens in January, and your policy is due for renewal in June, so the rates won’t be raised until then).

There are several factors influencing the insurer’s decision whether the rates are to be raised or not:

  • who was at fault of the accident;
  • how many injuries (if at all) were caused;
  • the amount of damage (usually the lower limit is $750);
  • if there was any influence (alcohol, drugs) on a driver;
  • how long ago the accident happened (if it occurred more than three years ago, it will be considered non-chargeable);
  • the driver’s record or history, including all offences and tickets.

And, of course, the amount will vary depending on the insurer and the state.

So, what consequences should you expect from the accident you were involved in? Depending on the status of the accident, with consideration of all above mentioned factors, these may be: insurance rate increasing, usually by 20-40% (see also the Insurance Services Office's (ISO) standard); cancellation of the discounts you were enjoying or even non-renewal of the policy; there even may be steep fines or jail time involved, in case of major accidents.

However, it's not that terrible as it may seem. Generally, a driver may indemnify him-/herself form the loss. Here are some tips and recommendations:

1) Be attentive when driving! Make sure there are no distractions that may cause you lose focus, namely: yelling kid or animals, ringing phones, and so on; of course you mustn’t talk or text on the phone; watch out for other people and cars on the road; on no consideration take alcohol drinks or drugs before driving; try to stay at home in bad weather conditions.

2) If there still was an accident, make sure that you properly described the accident, so that not to undertake excess charges for what you were not involved in.

3) Keep in mind, that there is a factor of so called "loss experience" (or claims made) of drivers like you in age, location and so on. So, make sure that you are charged properly, corresponding to your status.

4) In some cases you will not find any increasing even after an accident happens. This may be explained by “forgiveness”, provided by certain insurance companies, if it was your first accident. However, there may be additional conditions, e.g. good record for a certain period within the company.

5) Finally, you may just change your insurer!

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