Yahoo Autos How to Lower Car Insurance After an Accident: Everything You Need To Know
If you recently made a claim on your auto policy, you probably have questions about how to lower car insurance premiums after an accident. Even when you did not cause the crash, your rates for coverage will go up after any claim because you now represent a higher risk to the insurance company. According to statistics, drivers who get in one accident are more likely to get in a subsequent accident. Insurers also charge fees after you file a claim and account for these costs, such as agent time, in your new premium price. Try these strategies to obtain a lower price on auto insurance after a car accident.
Seek Coverage Elsewhere
Auto insurance website The Zebra reports an average annual auto insurance increase of about $767 after an accident, representing about a 50 percent increase. Because this accident will remain on your record for up to five years, it could result in more than $2000 in additional insurance expenses overall.
To avoid this effect, many insurance experts recommend switching insurers after an accident. Sometimes, you can find a better price simply by going with a different firm. You should get prices from other auto insurance carriers at least once a year to see if you can save, regardless of whether you have had a claim in the past 12 months. WalletHub notes that you can often get a coverage discount with this strategy.
According to The Zebra, you will likely find the most affordable coverage rates after an accident from State Farm, GEICO, or USAA, depending on the state where you live. However, USAA only writes policies for current and former military members and their families. The Zebra lists these average rate increases by company after an auto accident:
$304 - State Farm
$340 - USAA
$701 - Farmers Insurance
$710 - Liberty Mutual
$721 - GEICO
$826 - Nationwide
$1129 - Allstate
$1168 -Progressive
Update Your Coverage
Changing the limits and terms of your auto insurance policy after an accident can also save you money. Money Under 30 recommends increasing your deductible to achieve a lower monthly payment on your insurance premium. You can also decrease your liability coverage limits as long as you continue to carry at least your state minimum required amounts. Just make sure you don't cut your coverage so much that you will be left with significant out-of-pocket costs if you cause an accident.
If you have comprehensive coverage on your vehicle, dropping this optional policy can also lower your payments. You can even temporarily discontinue this type of coverage until it becomes affordable again after six to 12 months without claims. Comprehensive coverage pays for the cost of non-collision damage to your vehicle, such as theft, flood, or fire. However, if you lease or finance your vehicle your contract may require you to carry this type of policy or risk repossession of your car.
Go to Driving School
Many insurance companies will discount your rates if you complete a defensive driving or driver education course. In fact, some states even require insurers to provide this type of auto policy discount. Many classes are available online.
Defensive driving classes cover road safety techniques, ways to avoid accidents, and traffic laws in your state. According to Car Insurance Comparison, parents can save about 10 to 20 percent on their auto insurance premiums when teens on their policy take a drivers education course as insurers associate the completion of defensive driving classes with lower accident risk.
Value Penguin notes that the most generous discounts are usually available to drivers who are younger than 25 or older than 60, so if you're insuring drivers in these age brackets it pays to shop around to find insurance companies that offer major discounts for defensive driving.
Request Forgiveness
If you have an accident, ask your insurer about forgiveness programs if you aren't already enrolled in this type of program. You might be eligible to avoid a rate increase if you have not had an accident in three to five years or if this is your first accident claim. Motor1 reports that these firms forgive customer accidents:
State Farm
Progressive
Nationwide
Liberty Mutual
The Hartford
Allstate
GEICO
