Your driving record is what helps insurance companies determine your premiums. One car accident can send insurers into a frenzy, with agents crunching numbers for your new insurance rates. The good news is; you don’t need to sweat about it if your accident was five years ago.
If it hasn’t been that long, and you’re concerned about how long auto accidents affect insurance rates, keep reading. Ehline Law and our personal injury attorneys have dealt with many insurers. We are here to provide you with the information you need about insurance rates following your car accident.
Like many other states, the California Department of Motor Vehicles (DMV) assigns points for accidents.
Generally, a one-point crash will stay on your record for three years, while a two-point collision will vary on the offense committed.
A car accident can stay on your driving record for years, but the exact duration depends on the state you’re in and the violations committed causing your auto accident.
The California police report all accidents to the California DMV, which maintains a database. Since the Golden State is a fault-based state, according to the DMV, the accident may not show up on your driving record if another driver was responsible for it, or there were no severe injuries, and the property damage was less than $1,000.
A fault state is where the accident victim may not be responsible for any damages, property damage, or injuries, arising from an accident due to another’s fault.
If the accident exceeds $1,000 in damages, or someone suffered injuries or died, the state’s DMV requires you to file an SR-1 within ten days, even if you were not at fault. Filing an SR-1 helps the state record the accident and protects you from uninsured drivers.
In cases where it is an at-fault accident, injuring or killing someone, or damages above $1,000, it could stay on your record for three years. For serious violations, you may be looking at a more extended period. A DUI conviction can remain for up to ten years; that’s much lower than in Florida, where alcohol-related violations can stay up to 75 years!
The following are the violations and periods for which it will stay up on your record in California:
Auto insurance companies calculate premiums based on algorithms that consider the driving record. You may feel that your car insurance company is punishing you for the accident, but that’s not the case, as insurers calculate auto insurance premiums based on risk. The higher the risk, the higher the auto insurance rates.
For an at-fault accident, the car insurance carrier will increase your auto insurance rates more than those incidents where you’re not at fault. However, any claim can impact your premium, especially if you file multiple claims in a short period, even if you’re not at fault in any of those. But don’t worry; your car insurance rate may return to normal after a few claims-free years.
The car insurance rate can sometimes become unmanageable following your auto accident. In that case, it is best to seek other car insurance companies and request quotations. Ensure you are completely honest about your driving record when seeking online quotations. These are computer-generated quotes considering your answers to estimate the car insurance rate.
You don’t want to get a higher car insurance premium after switching from one insurance company to another just because you failed to disclose your driving history.
Car insurance rates tend to go up after you’re at fault in an accident, but the amount varies depending on several factors, including your car insurance provider, claims history, driving record, location, age, and gender. These factors help the insurance company assess the risk before determining the premium.
According to Bankrate’s analysis, insurance premiums, on average, go up by $750 after an accident.
Some car insurance companies offer forgiveness programs to drivers with good driving histories. Drivers enrolled in accident forgiveness programs might be eligible to waive their claim surcharge. However, these types of programs are not available in California.
In 1988, California passed Proposition 103, a law that requires insurance companies to take prior approval from the state’s Department of Insurance for implementing property and casualty insurance rates. In other words, California does not allow accident forgiveness programs because car insurance companies would charge higher premiums to offset the cost of forgiven accidents.
There are ways you can lower your insurance rate after a car accident. Speaking to an insurance agent is best, but here are some methods to help you reduce insurance costs.
Depending on your residing state, your credit may affect your insurance rate. Address the discrepancies in your credit report, clear all your debts, and stay on top of your payments to ensure a good credit score.
The higher the deductible, the lower the premium. However, increasing your deductible means paying more from your pocket when filing a claim. A minor accident may not put as much of a dent in your finances as a significant accident. Ensure that your deductible is enough to manage.
Car insurers have many discounts to offer, from telematics programs to student to multi-policy and many other discounts.
Speak to an insurance agent to know what discounts you’re eligible for.
If your policy is nearing renewal, it is time to search for a better one. Although it may be challenging to get insurance coverage from another insurer at the price you’re currently paying following your accident, you may find that other insurance providers offer better discounts or coverage options.
If your insurance coverage exceeds the state’s minimum coverage requirements, you could consider lowering your coverage which can reduce the premium. However, you must speak to a licensed agent about it first.
Insurance premiums depend on many factors, including the vehicle you’re driving. Getting a cheap-to-insure car may help reduce your premiums.
If your insurance company is mistreating you or you suspect they’re acting in bad faith, contact us at (833) LETS-SUE for a free consultation.
Michael is a managing partner at the nationwide Ehline Law Firm, Personal Injury Attorneys, APLC. He’s an inactive Marine and became a lawyer in the California State Bar Law Office Study Program, later receiving his J.D. from UWLA School of Law. Michael has won some of the world’s largest motorcycle accident settlements.