TL;DR: Yes, filing an auto insurance claim can increase your premium in many cases. Insurers often raise rates after a claim, especially if you were at fault, because a claim signals you’re a higher risk. How much your premium goes up depends on factors like the severity of the accident, who was at fault, and even state laws. For example, one at-fault accident can spike a full-coverage policy by about 45% on average. However, not all claims lead to a rate hike – minor not-at-fault incidents or comprehensive claims (for things like theft or hail) usually won’t impact your premium as much or at all.
Many insurers also offer accident forgiveness programs, meaning your first accident might not raise your rate. Every situation is unique, so it’s wise to review your policy or speak with an agent. If you have questions about a specific claim’s impact, call Insure on the Spot at 773-202-5060 for guidance from a licensed agent.
How do insurance companies decide to raise premiums after a claim?
Car insurance premiums are calculated based on risk, and filing a claim tells insurers that the risk of a future claim has increased. Before you ever make a claim, your rate is determined by factors like your driving history, age, location, vehicle, and sometimes credit score. Once you file a claim, especially an at-fault accident claim, insurers reassess your risk level. Here’s how they typically decide whether – and how much – to raise your premium after a claim:
Fault and accident severity
If you were at fault in an accident, it’s very likely your rate will go up. Insurers commonly apply a surcharge to your policy for an at-fault accident, resulting in a sharp rate increase for around three years. The more serious the accident (e.g. causing major damage or injuries), the higher the potential increase. For minor fender-benders, the surcharge might be smaller, but it can still be significant. On the other hand, if you weren’t at fault, many insurers will not add a surcharge (and some states prohibit them from doing so – more on that below).
Type of claim
Not all claims are equal. Liability or collision claims (where you seek coverage for an accident you caused) are seen as red flags and usually trigger premium hikes. In contrast, comprehensive claims for events outside your control – like hail damage, a cracked windshield, theft, or hitting a deer – typically do not raise your rates or cause only a minor uptick. That’s because these incidents aren’t blamed on driver error. However, if you file multiple comprehensive claims in a short time (say, several windshield claims), your insurer might still take notice and adjust your rate or deductible.
Claims frequency
Insurance companies also look at how many claims you’ve filed in recent years. A single claim might have a moderate effect, but multiple claims – even small ones – suggest you’re more likely to cost the insurer money in the future. As a result, frequent claimants tend to see larger premium increases or even face non-renewal. In fact, some insurers may cancel or not renew your policy if you file too many claims within a few years. This is especially true if the claims indicate risky behavior (like repeated at-fault accidents).
Loss of discounts
Filing a claim can cause you to lose certain discounts. For example, many insurers give a safe-driver or no-claims discount when you go a few years without any accidents or violations. Once you file a claim, you could lose this discount, effectively raising your premium even if the base rate doesn’t change. This can happen even with a small not-at-fault claim – you might not get a surcharge, but you could lose a claim-free discount, resulting in a slight increase.
Policy and company rules
Every insurance company has its own guidelines (often approved by state insurance departments) on how claims affect premiums. Insurers set surcharge schedules that outline how much to raise rates for different types of claims or accidents. For instance, one company might raise your premium 20% for an at-fault crash causing under $1,000 damage, and 40% for a crash causing $5,000+ damage. Another might use a flat surcharge regardless of claim size. Many insurers also have thresholds – for example, claims under a certain dollar amount might not count. If your claim payout is below, say, $500 or $1,000, the insurer might not increase your rate at all (this varies by insurer and state regulations). Always review your policy or ask your agent about these specifics.
Insurers access your driving record through the Department of Motor Vehicles (DMV) and industry databases when adjusting your rate. Any reported accidents or traffic violations will show up. If the claim involved a serious violation – like a DUI or reckless driving – the impact is even greater. A DUI-related accident often leads to not just a hefty surcharge but possibly a requirement for an SR-22 filing, which is a certificate of financial responsibility for high-risk drivers. An SR-22 is essentially the DMV’s way of ensuring you carry insurance after a major offense, and needing one is a clear sign you’ll be paying considerably more for insurance. In fact, a major at-fault accident or DUI can label you a high-risk driver, meaning fewer companies will insure you and premiums can skyrocket accordingly.
Which types of auto insurance claims are most likely to increase premiums?
At-fault accident claims are by far the most likely to cause a premium increase. When you file a claim for an accident you caused (or are deemed primarily responsible for), insurers see you as a higher risk going forward. The data backs this up: on average, a single at-fault accident can raise the cost of a full-coverage auto policy by about 45% compared to having no accidents. For example, if you were paying $2,700 per year, a crash might bump it to roughly $3,900 per year – an increase of over $1,000. This surcharge typically remains on your premium for three years in most states. Even a relatively minor collision claim can lead to a noticeable uptick, although severe accidents (with large insurance payouts or injuries) tend to result in larger surcharges.
Other types of claims and their likelihood of raising your rates include:
Multi-car or bodily injury claims
If your claim involves damage to multiple vehicles or injuries (especially if someone files an injury claim against you), the cost to the insurer is higher. Claims that pay out for bodily injury liability often result in substantial premium increases because they indicate a serious incident.
Single-vehicle collision claims
If you file a claim for crashing into a pole, a ditch, or otherwise damaging your own car, that’s considered an at-fault collision. These claims will usually raise your rates, though the increase might be a bit less than an accident involving another driver. Still, it marks you as having caused a loss.
Comprehensive claims (not-at-fault claims)
Comprehensive coverage pays for things like weather damage (hail, floods), fire, theft, vandalism, or hitting an animal. These incidents aren’t your fault, so insurers generally do not impose a surcharge for them. For instance, if a heavy windstorm drops a tree branch on your car and you file a claim, your premium likely won’t jump in the same way it would for a collision claim. However, frequency matters – if you file multiple comprehensive claims in a short period (say, two theft claims in a year), your insurer may start viewing you as unlucky or higher risk and could adjust your rate slightly. In some cases, they might raise your comprehensive deductible upon renewal instead of the premium.
Not-at-fault accident claims
These are claims where another driver was at fault and their insurance is covering the damage, or you’re hit by an uninsured driver and use your own uninsured motorist (UM) coverage. Ideally, a not-at-fault accident should not raise your premium because you didn’t cause it. In many states and under many insurers’ policies, such claims have zero impact on your rate. We’ll dive deeper into this in the next section, because state laws can affect this scenario.
Small claims (under the deductible or just over it)
If the damage from an incident is minimal, you might not even file a claim at all (more on that later). But if you do file a small claim (e.g. $600 in damages and you have a $500 deductible), the insurer pays very little. Technically, even a small at-fault claim could trigger a surcharge, but some insurers forgive tiny claims or have a threshold (like “don’t surcharge if payout was under $750” – this varies). It’s worth noting that even inquiry calls (asking your insurer hypothetically about a claim) could be logged on your record, so always clarify with your agent whether a minor incident will count against you if you’re just asking.
Multiple claims or combinations
If you have more than one claim in a recent period (typically 3 years), the effect on your premium compounds. Two at-fault accidents in three years, for example, could double your rate (or worse). An at-fault accident plus a couple of comprehensive claims might also lead to an increase, even though the comp claims alone wouldn’t have raised your rate. Insurers look at the overall profile; if you’ve filed several claims of any type, you start to fall into a higher-risk category. Drivers with numerous claims or incidents are sometimes required to obtain high-risk insurance or even file an SR-22 form with the state DMV if offenses are severe.
Will my insurance go up if the accident wasn’t my fault?
If you were not at fault for a crash, in most cases your own insurance premium should not increase – but there are some important caveats. Many states have consumer protection laws or regulations that prohibit insurers from surcharging you for accidents where you are 0% at fault. For example, Georgia law explicitly forbids insurance companies from raising your rates if you didn’t cause the accident, even if you file a claim under your own policy (like using your uninsured motorist coverage). Similarly, Tennessee statutes protect drivers from premium increases when they use their uninsured motorist coverage or were completely not at fault in a crash. Virginia and several other states also bar insurers from penalizing drivers for accidents they didn’t cause.
However, the reality can be a bit more nuanced. Here’s what to consider for not-at-fault accidents:
Using your coverage vs. third-party claim
If another driver was 100% at fault and their liability insurance pays for all the damage, your insurer isn’t involved in paying the claim. In that scenario, your policy typically remains untouched and your rates should stay the same. The incident may still appear on your driving record or insurance claims history, but marked as not-at-fault. Most insurers ignore not-at-fault incidents in pricing (and some states require them to ignore it).
Uninsured/Underinsured Motorist (UM) claims
If you’re hit by a driver who has no insurance or not enough insurance, you might turn to your own policy’s UM coverage to cover your injuries or damages. Although you’re not at fault, now your insurer is paying for the loss, which makes some drivers worry their rates will go up. The good news is that in many states, laws prohibit raising premiums due to UM claims when you were not at fault. For instance, Tennessee law says your insurer cannot increase your premium or cancel your policy solely because you made an uninsured motorist claim for an accident that wasn’t your fault. The logic is that you shouldn’t be penalized for another’s lack of insurance. Check your state’s insurance regulations or ask your agent about local laws on this. States like California also ban surcharges for not-at-fault accidents as part of their insurance code (California drivers enjoy strong protections under Proposition 103, which among other things prevents insurers from using not-at-fault accidents in setting rates).
No-fault states
In “no-fault” auto insurance states (like Florida, Michigan, etc.), you typically file injury claims with your own insurer regardless of fault (via Personal Injury Protection coverage). But fault still matters for your premiums and certain claims. If you weren’t at fault, even in a no-fault state, the above principles generally hold – your insurer shouldn’t hike your rate for a pure not-at-fault incident. They will, however, still surcharge you for any at-fault accidents. No-fault laws mainly affect injury claims processes, not how premiums are determined.
Insurer practices
Despite laws, some insurers consider all claims in some way. They might not apply an official surcharge for a not-at-fault accident, but internal risk scoring could flag drivers with multiple incidents (even if not your fault) as “more likely to claim” in the future. For example, if you’ve had three not-at-fault accidents in a short time, your insurer might suspect you drive in a high-risk area or simply have bad luck – either way, they could decide to raise your base rate or not offer you the lowest tier pricing. This isn’t common, but it does happen. In fact, one analysis found certain major insurers have raised rates after not-at-fault accidents in some cases (outside states that ban the practice). It may seem unfair, but insurers justify it by saying any claim indicates increased future risk.
Loss of discounts
As mentioned earlier, even a not-at-fault accident might affect a claim-free discount. If your insurer’s discount program requires absolutely no claims within a period, then just the act of filing a claim (regardless of fault) could reset the clock on that discount. The premium difference from losing a discount is usually smaller than a surcharge for an at-fault accident, but it’s still an effect to be aware of.
Should I file a claim or pay for damages out of pocket?
It depends on the situation. If the damage is minor and close to your deductible amount, you might consider paying out of pocket to avoid a potential premium increase. For example, let’s say you backed into a pole and caused $600 of damage to your bumper, and your collision deductible is $500. You’d only get $100 from an insurance claim (since you pay the first $500), and an at-fault claim like that could raise your premium by more than $100 in the long run. In such cases, it could be a better financial decision not to file a claim. Many experts suggest that if the repair cost is only slightly above the deductible, it may be wiser to handle it yourself. This way you preserve your claim-free status and avoid any rate hike.
However, there are important exceptions:
Accidents involving another vehicle or injuries
If another driver, passenger, or pedestrian is involved, or someone’s property is damaged, always report the accident and file the claim. Do not attempt to privately settle significant accidents. Even if the other party says they’ll pay or you both agree to “keep insurance out of it,” this can backfire badly. The other person might later change their mind, file a claim, or even sue for injuries. If you failed to report it, your insurer might refuse coverage because you violated the policy conditions that require prompt notification of accidents. Involving your insurer from the start protects you – they can handle claims from the other party, provide legal defense if needed, and it ensures you’re complying with the law. In fact, in many states you’re legally required to report accidents to the police and/or DMV if there are injuries or a certain amount of property damage (for example, over $500 in Georgia as per O.C.G.A. § 40-6-273). As a rule of thumb, if it’s more than a minor scrape, file the claim and let your insurance handle it. A possible premium increase is usually much less painful than paying out huge costs or facing legal issues alone.
Uninsured motorist claims and hit-and-run
If you’re injured or your car is damaged by a hit-and-run driver or someone with no insurance, you should file a claim under your uninsured/underinsured motorist coverage (if you have it). Don’t hesitate thinking your rates will go up – remember, in many places it’s illegal for insurers to raise premiums for using UM coverage when you weren’t at fault. That coverage is there to protect you. Similarly, if your car is vandalized or stolen (comprehensive incidents), you should make a claim if the loss is significant, because these typically won’t result in a rate increase in the first place.
When in doubt, involve your insurer
If you’re unsure whether the damage is above or below deductible, or whether the other party will definitely handle things, it’s often best to inform your insurance company anyway. You can notify your insurer about an incident without immediately filing a claim, in order to get advice. Just be clear on whether that conversation will be logged as a claim. (Some insurers log any incident report as a claim, even if no payout is made, which could count against you; others allow “information only” reports. Ask your agent how they handle it.)
Long-term cost vs short-term cost
Weigh the out-of-pocket cost against potential premium increases. For example, if repairs will cost $2,000, it’s likely worth filing a claim and paying your deductible. A rate increase on, say, a $1,000 yearly premium might be 20-40% (~$200–$400 extra per year) and last 3 years, totaling perhaps $600–$1,200. The claim payout of $1,500 (after your $500 deductible) could still be worth it, but you have to crunch the numbers. On the other hand, if repairs are only $700 and your deductible is $500, a minor premium bump could wipe out the $200 you’d gain from claiming. Also consider your savings: you bought insurance for a reason—to cover losses you can’t comfortably cover yourself.
How long does a claim affect my car insurance rates?
A claim’s impact on your insurance rates isn’t permanent, but it lasts for several years. In general, an at-fault accident or substantial claim will affect your premium for approximately 3 to 5 years. The exact duration depends on your state’s rules and your insurer’s guidelines:
Three-year standard
Many insurance companies follow a three-year surcharge period for at-fault accidents and moving violations. This means if you had an at-fault claim in, say, 2022, it should stop affecting your rates by 2025 (assuming no other incidents in the meantime). The Insurance Information Institute notes that these premium increases typically stay on your policy for about three years. After that, if you’ve maintained a clean record, your rate should drop back to “normal” at your next renewal.
Five-year lookback
Some insurers and states use a longer period, often five years. For example, certain states allow insurance companies to surcharge for accidents and violations for up to 5 years. If you switch insurers, the new company will also usually ask about any accidents in the past 5 years. Major infractions like DUIs can have effects that last even longer (a DUI might affect your rate for 5-10 years, and the required SR-22 filing is often mandated for 3-5 years depending on the offense).
Gradual decrease
Often, the impact of a claim might lessen over time. Some insurers impose the largest surcharge in the first year or two after the accident, then gradually reduce it if you have no further incidents. For instance, a surcharge might be 40% the first year after an accident, then drop to 20% by year three before disappearing. This isn’t universal, but it’s one way companies handle it. Check if your insurer has a “diminishing surcharge” policy.
Accident forgiveness resets
If you have an accident forgiveness program on your policy and you used it for a claim (meaning your rates didn’t increase at that time), be aware that the forgiven accident still happened – you just didn’t pay for it in your premium. If you have another accident during the forgiveness period, the insurer will likely treat both accidents as part of your record. Also, once you’ve used the forgiveness, a subsequent at-fault accident will cause a surcharge (you usually only get one forgiven incident per policy). Some insurers restore your accident-free status if you go another set number of years without claims after using accident forgiveness.
Claims history databases
Remember that your claims history is tracked in databases like CLUE (Comprehensive Loss Underwriting Exchange). Most insurers report claims to these databases. Even after your insurer stops surcharging you after three years, the incident might still be reportable to a new insurance company for five years. Practically, though, after 3-5 years, most accidents hold much less weight. By the time 5+ years have passed, many companies will treat you as if you have a clean slate (major violations being an exception). It’s always a good idea to drive safely and keep your record clear – time is your friend in this case.
Can filing multiple claims cause my policy to be canceled?
Yes. Filing too many claims in a short period can lead an insurer to non-renew or cancel your policy in extreme cases. Insurance is intended for unexpected, infrequent losses – if you start using it very frequently, the insurer may decide you’re not a profitable customer. Here’s how multiple claims can jeopardize your coverage:
Non-renewal vs. cancellation
Generally, insurers won’t outright cancel your policy mid-term for filing claims (unless there was fraud involved). Instead, they might let your policy run to the end of the term (6 or 12 months) and then issue a non-renewal notice. Non-renewal means they will not offer to continue your coverage when it’s time to renew. In most states, they must give you advance notice (often 30-60 days) and possibly a reason. A common reason given is “frequency of claims” or “excessive claims history.” For instance, if you’ve had three at-fault claims in two years, many insurers will consider non-renewing. If you also have a poor driving record on top of claims, the chance of non-renewal is even higher.
High-risk pool or non-standard insurers
If your policy is non-renewed due to claims frequency, you may have to seek insurance from a non-standard insurer that specializes in high-risk drivers. These policies tend to be more expensive. In worst-case scenarios, drivers who can’t find a willing insurer end up in their state’s assigned risk pool (a state-run program that provides last-resort insurance at high rates). Having multiple recent claims can put you in that category.
Fraudulent or suspicious claims
Filing many claims can also raise red flags for potential fraud (even if you’re honest). Insurers track patterns, and if a customer files unusual claims frequently, they might investigate for fraud. If fraud is proven, cancellation is immediate and can have legal consequences. But even without fraud, multiple claims will make an insurer worry that you’re either unlucky, reckless, or possibly not maintaining your property well (if it’s comprehensive claims like repeated thefts or glass damage).
Claims free period reset
If you’ve been non-renewed and have to go elsewhere, usually the key to getting back into standard insurance markets is to go claims-free for a while. After enough time without claims (and any required SR-22 period, if applicable), your risk profile improves. Insurers might welcome you back at normal rates once the string of claims is well in the past.
Policy cancellations
While mid-term cancellation for claims is rare, it can happen after very severe incidents. For example, a drunk driving accident that results in major liability could lead to cancellation or at least a strong suggestion to find another insurer. More commonly, if you’re filing claims that are below your deductible or filing frivolous claims, an insurer might warn you or cancel for “misuse of policy.” Always read your insurance contract; some have clauses about providing false information or failing to upkeep your vehicle (which could indirectly lead to more claims).
Frequently Asked Questions
Will my auto insurance always go up after I file a claim?
Not always. It depends on the circumstances of the claim. If you were at fault in an accident, your auto insurance premium will likely increase at your next renewal. The increase can be substantial (often 20% to 50% for a single at-fault accident). However, if the claim was for an incident that wasn’t your fault, or was a comprehensive claim (like weather damage or theft), many insurers will not raise your rates. Additionally, if you have accident forgiveness on your policy, your first at-fault claim might not result in any premium hike at all. Always check your own insurer’s policies and your state’s laws – some states prohibit insurers from raising rates for not-at-fault accidents.
How much does car insurance go up after an accident or claim on average?
It varies by insurer and state, but on average an at-fault accident can increase a typical car insurance premium by around $400 to $800 per year. This often translates to a 30%–50% increase in the annual premium. For example, a driver with a $1,000/year policy might end up paying $1,450/year after a crash (roughly a 45% jump). The exact amount depends on factors like the severity of the accident, your prior driving record, and whether any discounts fall off. Remember that this higher rate usually applies for three years before dropping down again. In contrast, a small claim (like a cracked windshield) might not increase your premium at all, and a not-at-fault accident generally shouldn’t increase it either. Each insurer has a unique rating formula, so if your premium went up dramatically after a claim, it could be worth shopping around for comparison quotes.
Do I have to report an accident to my insurance if I don’t want to file a claim?
Technically, most insurance policies require you to report accidents to your insurer promptly, even if you don’t end up filing a claim. This is to protect the insurer’s rights and to ensure any potential claims can be handled properly. If it’s a very minor single-car incident (like scraping your own fence), you might choose not to inform your insurer since no one else is involved and you’ll pay for repairs yourself. However, if another vehicle or person was involved, or there’s any injury or significant damage, you absolutely should report it. Not reporting an accident can lead to serious problems: the other party could file a claim or lawsuit later, and your insurer might deny coverage because you didn’t notify them. Also, in many states you’re required by law to file a police report or DMV report for accidents above a certain damage amount or involving injuries.
What is accident forgiveness and can it prevent a rate increase?
Accident forgiveness is a feature or add-on offered by many auto insurers that forgives your first at-fault accident. With accident forgiveness, the insurer agrees not to increase your premium after your first accident (assuming it’s a qualifying accident under their rules). Typically, you either earn this benefit by driving claim-free for a certain number of years or you purchase it as an endorsement. It’s usually one-time use – meaning if one driver on the policy has an at-fault accident, that incident is “forgiven” (no surcharge), but the next accident would not be forgiven. Accident forgiveness can be a valuable perk, as it can save you hundreds of dollars by avoiding a rate hike. Keep in mind it doesn’t erase the accident from your record; it simply means your insurer isn’t charging you extra for it. Also, not every state allows accident forgiveness, and not every company offers it. Check with your insurer to see if you have this benefit, and understand the conditions (for example, some programs won’t forgive an accident if a DUI was involved or if the claim cost exceeds a certain high amount).
Can my insurer drop me because of a claim?
An insurer generally won’t cancel your policy over one claim, but if you have multiple claims or a very severe claim, they could decide not to renew your policy. Companies have guidelines on what risks they’re willing to insure. If you file several claims in a short time (especially at-fault accidents), you may be deemed too high-risk and the insurer might send a non-renewal notice when your policy expires. They typically won’t cancel mid-policy except for extreme reasons like insurance fraud or a gross violation (e.g., a DUI accident might prompt cancellation with proper notice, depending on state laws). If you do get non-renewed, you’ll need to find coverage elsewhere. You might have to go with a specialty or high-risk insurer, especially if the claims record is recent. The best way to avoid this scenario is to practice safe driving and use your insurance sparingly – don’t file claims for very minor issues. Also, maintain at least the state-required coverage; driving uninsured after being dropped would lead to even worse outcomes (like needing an SR-22 filing and facing license suspension).
How can I lower my insurance premium after an accident or claim?
If your premium went up due to a claim, there are a few strategies you can use to potentially lower it over time. First, maintain a clean driving record going forward – the passage of time without any new claims or tickets is the surest way to improve your rates. After three years (or whatever your insurer’s surcharge period is) that accident will no longer count against you. In the meantime, ask your insurer about discounts: you might take a defensive driving course to earn a discount, or install a telematics device (usage-based insurance program) that could offset some of the increase by proving you’re now a cautious driver. You can also shop around; some insurers penalize accidents less than others, so getting quotes from competitors could find you a better rate even with the claim on your record. Increasing your deductibles on comprehensive and collision coverage is another way to lower your premium (just make sure you can afford the higher out-of-pocket if something happens). Lastly, check if your insurer offers a loyalty program or if bundling your auto with home/renters insurance could give a multi-policy discount. While an accident’s mark takes time to fade, smart moves like these can help reduce the financial sting in the interim. Remember that insurance premiums eventually do go back down if no further incidents occur – patience and prudence pay off.