There are several various ways that an automobile accident can affect a motorist and what they can end up paying for premiums. Effects differ mainly based on circumstance and what transpired to cause the loss. The insurers also abide by different underwriting guidelines and if applying for new coverage each provider’s pricing may vary based on the person’s driving record.

If currently insured and involved in a collision they are many variables that determine how accidents affect car insurance and the policyholder. If the insured is involved and they were not at-fault most companies will not increase their premiums. If an individual is at fault they may or may not immediately have their rates increased but they can be raised at time of renewal or their company can elect not to renew the policy. On the other hand there may be no consequence if found liable for collisions that cause minimal damages. Some carriers may dismiss an accident if it causes property damage under their particular threshold.

Factors of an Accident That Can Significantly Affect Auto Insurance

If a policyholder is the cause of the collision and there are injuries involved there may be a substantial increase in premiums and it will be documented on a “letter of experience”. Also if the driver receives a citation after the involvement in accidents they will automatically be considered at-fault due to the fact that they must have broken a traffic law and are assumed to be the cause. Having an at-fault accident and a violation on a driving record can raise rates quite a bit.

A motorist who is involved in a collision and is found to be under the influence of drugs or alcohol will most likely be charged with being liable along with other legal consequences to follow. Being responsible and convicted of a DUI (driving under the influence) or DWI (driving while intoxicated) will automatically categorize a person as a high risk driver and will they definitely see a substantial increase in future premiums. After a conviction they will most likely have to obtain an SR-22 and maintain it for a period of three years with their state’s department of motor vehicles.

Always obeying traffic laws and practicing safe driving is very important to avoid accidents and costly increases in premiums. There are helpful tips from the State Bar of California on what steps to take following an accident. Every state has their own regulations in regards to their traffic laws; one should check with their state’s authority following an incident.