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Will my insurance go up if someone hits me? After an accident caused by another driver, you may have concerns about the impact on your auto coverage premium rates. Your auto insurance company will decide whether to raise your rates or not based on the circumstances of the accident. The insurance adjuster will determine who caused the accident, whether you live in an at-fault state, the policies of your auto insurance company, whether anyone behaved carelessly when the crash occurred, and whether it involved circumstances beyond your control such as bad weather, road conditions, or mechanical failure.
Review this guide to learn more about how a no-fault claim might affect how much you pay for car insurance.
At-Fault vs. No-Fault Laws
Twelve U.S. states currently have no-fault car accident laws:
- Utah
- North Dakota
- Minnesota
- Massachusetts
- Kentucky
- Hawaii
- Pennsylvania
- New York
- New Jersey
- Michigan
- Florida
If you live in one of the other 38 states, fault laws apply if you have an auto accident. However, living in a no-fault state does not mean that no one takes responsibility for the accident. It simply means that you cannot sue the responsible driver unless you have debilitating personal injuries.
Compensation After a No-Fault Accident
In most cases, the other driver’s insurance policy will compensate you for the cost of an accident in which the policyholder was at fault. You can file a claim with his or her insurance company for auto accident injury expenses as well as damage to your vehicle and personal property. Since you do not require your own insurance company to reimburse these costs, finance website The Balance notes that they usually won’t raise your rates to compensate for the expenses associated with a claim.
If you have to file a claim with your own insurance company but another driver was at fault, your insurer may go after the other driver’s policy for compensation. In this instance, your rate would probably also stay the same. Certain states, including California and Oklahoma, legally prohibit insurance companies from raising customer rates after no-fault claims.
Policy Genius notes that you would follow the same procedure if someone hits your parked vehicle to file a third-party claim with his or her insurance company. However, if someone damaged your vehicle and did not leave contact information, you should contact your auto insurance provider and file a police report.
In any case, the insurance company will thoroughly investigate the circumstances leading to the crash. For example, a driver hitting your car does not necessarily mean he or she was at fault if you made driving errors that created an unavoidable crash. Even if you cause a minor accident to avoid a major accident, the insurance company can still find you at fault.
AutoInsurance.org notes that even if the insurance company finds you were not at fault, your policy does not necessarily cover the damage. Basic state-mandated liability insurance only pays for damages suffered by others if the policyholder causes a crash. You must have collision coverage to receive compensation from your insurer for the cost of repairs to your vehicle. Full coverage insurance, which includes both comprehensive and collision policies, costs about $440 per year.
If you file a claim against your collision policy after a hit-and-run accident, you must file a report with your insurance company and pay the deductible you selected when you purchased coverage. An uninsured or underinsured motorist policy, required in some states and optional in others, will also pay costs associated with a hit-and-run accident or a collision with a driver who has insufficient coverage.
Uninsured Motorist Property Damage Coverage
AutoInsurance.org notes that drivers can seek financial protection from uninsured motorist accidents with an alternative policy called uninsured motorist property damage (UMPD). This policy is less costly than collision coverage, so it makes sense for people who have older cars without much value who nonetheless do not want to pay to repair or replace the vehicle after an accident. The typical UMPD policy covers up to $3500 in car repairs with no deductible after a hit-and-run or a collision with an uninsured driver. If you also carry collision coverage, you can use UMPD coverage to pay your collision deductible.
Average Rate Increase After a No-Fault Accident
According to data from the Consumer Federation of America reported by the auto insurance website The Zebra, the average rate increase for drivers in no-fault crashes is 10 percent. If you have a history of claims, your insurer may raise your rate for another claim even if you did not cause the accident. The website reports these average six-month premiums by company after a no-fault auto accident claim:
- USAA – $567
- Nationwide – $639
- GEICO – $642
- State Farm – $677
- Progressive – $770
- Farmers Insurance – $869
- Allstate – $1013
When you are the at-fault driver in an accident, Car Insurance Comparison reports that you can expect about a 49 percent premium increase. In this situation, you may be able to save by shopping around for a policy with a different insurer.
Most claims remain on your driving record for about three to five years. However, this varies depending on the type of claim and the state where you reside. According to the Balance, a no-fault accident will remain on your record for about three years, compared to five years for a minor at-fault accident, eight years for a hit-and-run accident, and ten years after an arrest for driving under the influence of drugs or alcohol.
Every insurance company has its own policy about whether they add a premium surcharge after no-fault claims. When shopping around for quotes for new auto insurance, ask each company whether they will raise your rate in this situation.
Your auto insurance company should provide assistance after an accident, even in situations involving fault. If you do not feel you got the service you expected, consider looking for a new provider. Check this out if you need additional information, resources, or guidance on car insurance.
Sources:
When a Not-At-Fault Claim Can Raise Your Insurance Costs
Why does a not-at-fault accident affect my insurance?
Someone hit my car, whose insurance do I call?
Does my car insurance go up if someone hits me? (3 Questions)
If my car is hit, does my insurance go up?
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