How Long Does an Accident Stay on Your Insurance?
Last Updated on February 10, 2023
Car accidents are becoming more and more common today. This is partly due to the increased number of drivers (more drivers means a better chance of getting in a wreck) but also due to the increased amount of distracted driving.
Distracted driving doesn’t just include texting, although that is by far the most common and one of the most dangerous distractions. It also includes any activity on your phone, whether it’s texting or making a phone call. Distracted driving can also include things such as eating while driving, fixing make-up while driving, or really anything that diverts your attention away from the road.
Auto accidents have a big impact on what you pay for your auto insurance. Insurance companies look at many factors in determining the rates you pay, with one of the biggest factors being your driving history.
The reason for this is simple: if you’ve gotten into many accidents before, the chances that you’ll get into another accident are a lot higher. Therefore, the insurance company is more likely to pay out money on your behalf, so they charge you higher premiums to try and offset their expected claims.
Just How Long Will An Accident Affect Your Premiums?
Just how long will an accident affect your auto insurance rates? The simple answer is either 3 or 5 years.
Many companies will look back five years at your driving history, which includes accidents and traffic violations. However, some companies only look back three years for both.
As with most things in insurance, there isn’t a hard and fast rule regarding rates and accidents. There is a chance that having just one accident on your record won’t increase your rates any, but this greatly depends on the company and other factors that go into your overall rating structure.
One accident might not increase your rates, but having multiple accidents definitely will. Having multiple accidents in the last 3-5 years can cause your auto premiums to double, triple, or more.
To illustrate the difference in car insurance rates after an accident, Insurify compiled quotes from major insurance companies for a hypothetical driver without an accident, with an accident six months ago and four years ago. Here’s what they found:
| Insurer | Monthly Premium Without Accident | Monthly Premium With At-Fault Accident 6 Months Ago | Monthly Premium With At-Fault Accident 4 Years Ago |
|---|---|---|---|
| Nationwide | $191 | $298 | $229 |
| The General | $342 | $487 | $342 |
| Mercury | $140 | $229 | $163 |
| Infinity | $124 | $161 | $124 |
| Kemper | $129 | $187 | $156 |
| SafeAuto | $163 | $222 | $163 |
| Dairyland | $211 | $211 | $211 |
| Bristol West | $92 | $126 | $95 |
| GAINSCO | $211 | $274 | $211 |
Different Degrees of Car Accidents
Just how much your rates go up will greatly depend on the type of accident you had. Insurance companies assign tiers to accidents based on severity, fault, and overall type. Most of them use a points system to help determine what your rates should be.
For example, a DUI-based accident is one of the most severe types of accidents, and this will have a profound effect on your auto insurance. Even if you don’t get into an accident, if you get pulled over for a DUI, expect your auto insurance rates to skyrocket.
If you were at fault for the accident, this would also be assigned points. Having one at-fault accident on your record will definitely cause your rates to increase because the insurance company will determine you to be at greater risk for further accidents in the future.
Not-at-fault accidents are assigned a lower tier than at-fault accidents. Depending on the company, not-at-fault accidents can still cause your rates to go up. A lot will depend on the severity of the accident and other factors that the company uses.
There are also comprehensive claims that can happen (such as a tree branch falling on your car) that are assigned a lower tier. There is a greater chance of these types of claims not increasing your rates than accidents involving other cars.
Another factor that insurance companies use in determining your possible rate increase will be the amount of money paid out. If a tree branch fell on your hood and the company paid out $500, they might not raise your rates. If your car caught on fire, or you had a not-at-fault accident, but your car was totaled, the company will pay out more money and will be much more likely to raise your rates.
What Can You Do To Keep Your Car Insurance Rates Low?
If you’ve had an accident and your insurance company has raised your rates, is there anything you can do? Yes and no. There is nothing that you can do about your accident, you will need to wait 3-5 years and maintain a clean driving record for that accident to fall off your rates.
However, there are other things you can do to help offset the increased cost of your auto policy.
1. Raise Your Deductibles
If you carry comprehensive coverage and collision coverage on any vehicle on your policy, raising those deductibles will lower your overall premium. Consider raising them to $1,000, or even $2,500, to help offset the cost of a higher premium.
2. Multi-Policy Discount
If you have a different company for your homeowners or renters policy than you do for your auto insurance, consider using the same company to get a big multi-policy discount. Many companies also give extra discounts for motorcycle policies, boat policies, or even RV policies.
3. Prevent Future Accidents From Going on Your Record
If you currently have a clean driving record, check to see if you’re insurance company offers accident forgiveness. This is an endorsement that you add to your auto policy that guarantees the company won’t increase your rates after your first accident. Some companies, like GEICO, even have incident forgiveness, which will forgive minor moving violations (like speeding tickets).
4. Drop Unneeded Coverage
It’s always recommended that you drop unneeded coverage, especially on older vehicles. The common approach is to get rid of comprehensive and collision coverage on an older, lower-value vehicle because oftentimes, the cost to repair the damage done eclipses the value of the car. You can also simply get rid of one of these coverage types (such as collision coverage) if you fear that you would be driving around with too little coverage. Whatever you do, always ensure you meet your state’s minimum coverage requirements.
Even though one accident might cause your rates to increase, insurance companies usually use a leveled approach. You might see a small increase after your 1st accident, with subsequent accidents causing more dramatic increases.
If you’ve just had one accident, there are things you can change on your policy to help offset the increased cost until the accident falls off in 3-5 years.
