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Today, many people worry about getting cheap car insurance after an accident. We often believe that all insurance companies will punish us because we made a mistake. However, you can still get a good deal, even if you have a less-than-perfect driving record. You just need to know where to look.
How Does Bad Driving Affect Your Car Insurance Price?
Your car insurance price is affected by the severity of the offense. One driving ticket over a couple of years will not make a huge difference in your price. However, if you are a ‘repeat offender’ or had multiple accidents in the past, you can expect your insurance price to rise.
The price increase will depend on how much risk the insurance company thinks you present. If you are found to have caused an accident, your premium can go up by up to 50 percent. If you are not at fault, you could still be facing higher rates.
Other Factors Insurance Companies Consider When Giving You a Price
Your driving history is not the only thing that insurance companies consider when giving you a quote. They will assess your risk levels based on the following additional factors:
- Your age
- Your occupation
- Your credit rating
- How long you have been driving
- Your location
- The number of miles you drive each year
- The safety of your car
You can get a list of safe cars based on their safety ratings on our blog.
Does Your Insurance Premium Go Up After An Accident?
Your premium will most likely go up after an accident. You cannot expect your insurer to put you in the same risk category as before the accident, no matter how small it was. You will have to pay more, but the good news is that you can compensate for the price increase by applying for different discounts.
Insurance companies will consider different factors when changing your price after an accident, such as the severity of the accident, who was at fault, your driving record, and why the accident occurred.
No matter what caused the accident, if you get a driving citation, and you have multiple violations, you will be put in a higher risk category.
How To Get a Cheap Car Insurance After An Accident
After your accident, you might need to get an SR22 certificate (Certificate of Financial Responsibility) to prove that you have valid insurance. This is when your insurance company gets notified. It is crucial that you notify your insurance company of every accident and incident, no matter how small it is. It is better to be open and honest.
You will also be required to file a claim for the accident with your company. The accident investigation will assess your role, the amount of damage, and who was at fault. Read our guide on insurance claims on our blog.
Next, you will need to contact your current insurance company and ask them to work with you. Some insurance policies have an accident forgiveness clause attached. Ask them if you have this, so your price can remain the same. If you don’t have the clause, you need to know what the new price will be so you can start shopping around. Once you have the quote from the company, go to the major companies’ websites or a price comparison engine. National companies that offer quotes online include USAA, GEICO, State Farm, Nationwide, and Progressive.
Once you have shopped around, and you still think that the increase is too high, you might decide to change your policy or prove to your insurance company that you are taking safe driving seriously. Taking a defensive driving course can significantly lower your premiums.
If you want to improve your price, it might be a good idea to track your driving. The longer you can keep a clean record, the better discounts you will be entitled to later on.
The Reason for the Accident Determines Your Car Insurance Price
If you are the at-fault driver, you will need to pay an extra surcharge with every insurer. If you had a DUI and are facing prosecution, you are likely to have more problems getting a good price than having a small collision that was not your fault. If you were driving a high-power vehicle, you are considered to be a high-risk driver, too. For more information, read NerdWallet’s guide to high-risk driver categories.
If your car insurance lapsed before the accident, you will not only have to pay the damage yourself, but you will also need to take the blame and pay higher premiums in the future. You can also have your license suspended and be charged with a Class C or B misdemeanor.
Getting Good Car Insurance with a Bad Driving Record
Your driving record is not the only factor that determines your insurance cost. There are some ways you can compensate for your mistake. You can apply for other discounts, even with a bad driving record. Here are some tips to reduce your premiums:
- Shop around to get a price from different providers. Some companies specialize in insurance for less-than-perfect driving records.
- Work on your credit rating. This will reduce the overall risk for the insurance company and the price you get, too.
- Get a discount based on your occupation, your military association, or your grades if you are a young driver.
- Change your deductible amount. This will lower the premium and can save you up to 30 percent.
- Lower your coverage. If you cancel your comprehensive coverage or your collision insurance, you can get a better price.
- Apply for loyalty discounts. Some companies will offer you a lower rate if you have been a customer for a number of years.
- Take extra driving lessons. This will not only help you drive better but will also reduce the risk for the insurance company, so they might drop the price.
- Get a driving monitor system. This will automatically trigger a discount with some insurance providers.
- Get a smaller and safer car. A less expensive car will also help you save.
If you think that having an accident will make your car insurance automatically go up, you may be pleasantly surprised to know that isn’t necessarily the case. When you understand what factors affect your rate, you can keep potential increases in check.
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