Does a Car Accident Increase Insurance?

• Step 1:
  

Types

• Step 1:
  The type of accident has much to do with whether your insurance will increase. An accident that is not your fault will not likely cause an increase, while one that is considered to be your fault could cause your rates to rise.

Size

• Step 1:
  If you are at fault, the size of the payout to the other party can determine whether your rates go up. If the amount is over a certain dollar threshold, a penalty could be added to your regular premium.

Accident Forgiveness

• Step 1:
  Some companies include a feature in auto insurance policies called first accident forgiveness. This means that if you achieve certain criteria, such as keeping your policy in force for a certain length of time, no surcharge will be assessed after your first accident.

Significance

• Step 1:
  If a surcharge does apply, it could be substantial. Depending on your carrier it could be as much as 20 to 40 percent of your premium. The surcharge will usually drop off after a period of time if no more accidents occur.

Considerations

• Step 1:
  When shopping for car insurance, you should always ask to see the carrier's surcharge table, as well as find out if the carrier offers first accident forgiveness.