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For many, accidents often result in increased policy premiums.

While the amount of the increase differs among policyholders, it can have a negative impact on their finances regardless.

So, how much does insurance increase after an accident? Here’s what you need to know about when and why insurance companies raise premiums after an accident.

Does Insurance Go Up if You Get Hit by Another Driver?

Whether your insurance rate goes up depends on several factors, such as the amount of damage in the crash, the number of accidents you’ve had in the past, and liability.

Generally speaking, insurance premiums increase more if there is a lot of damage. In addition, they tend to increase if the policyholder has recent accidents on their record.

However, the amount the insurer raises the premium also depends on who caused the accident.

In many situations, insurance companies consider policyholders that cause a crash a higher risk.

As a result, they offset that risk by charging more for coverage.

Will a Hit-and-Run Claim Raise My Insurance?

Ultimately, this depends on the state and your insurance company. In cases where the policyholder is a victim of a hit-and-run, the insurer sometimes doesn’t increase the premium at all.

However, this isn’t a blanket rule, so some insurers may raise the premium anyway, even if you aren’t at fault.

How Much Will My Insurance Go Up After an Accident?

Again, this typically depends on the internal processes of the insurer.

After an accident, your insurance premium may increase anywhere from $200 to $800, and this varies widely among providers.

For example, Progressive claims that the average premium increase for policyholders nationwide is 28%.

Based on the Insurance Information Institute’s 2019 data on average insurance premiums across the U.S., that’s a difference of about $300 for those with an annual premium of $1,070.

Another factor that affects the size of the increase is location.

While the national average according to the Insurance Information Institute is $1,070, some states have higher or lower averages.

The average annual premium in Alabama is $932.14, so you might expect a slightly lower increased insurance premium after an accident here.

But remember that insurance premiums increased in Alabama in each of the preceding years, so any increase in premiums after an accident will just add to your financial burden. 

How Long Does an At-Fault Accident Stay on an Insurance Record?

Typically, insurance companies consider accidents only within the previous three to five years when determining your premium.

This means that any changes to your premium after an accident aren’t permanent.

However, it takes some time without additional accidents to lower your premium. 

Ways to Lower Your Rate

If you do get into an accident, there are a few ways to help reduce the impact of your rate increase. The first option is using your insurance provider’s accident forgiveness policy.

Some providers, such as Geico, Allstate, and Progressive, allow drivers with good records to maintain their current premium after an accident.

Another option you may have is searching for discounts through your employer or other organizations.

Alumni of certain universities, for example, get reduced rates from partnering insurance companies.

Injured in an Accident in Alabama? The Attorneys at Fob James Law Firm Are Here to Help

We hope this article helps answer the question, “How much does insurance increase after an accident?”

Our attorneys understand how stressful the claims process is and know that you may have many questions about the process.

If you or a loved one sustained an injury in an accident, we’ll passionately fight for your recovery.

To schedule a free, no-obligation consultation, contact us online or give us a call at 205-407-6009. We have offices in Birmingham and Montgomery, AL.

Author Photo

Fob H. James, IV

Fob James obtained a B.S., in software engineering from Auburn University and then continued his education by getting his J.D. from Vanderbilt University School of Law. After working for a large regional firm for several years where he obtained awards for both individual and corporate clients, Fob found that his passion was fighting for individuals who have been seriously injured or wronged by others. Fob believes that the jury is the great equalizer to the power and influence that large corporations have in society.