How Do Car Accidents Affect My Insurance Rates in Alabama?

Posted in Car Accidents on April 22, 2019.

No one ever wants to be in a car accident, but many people will suffer injuries and property damage in these crashes on Alabama roads every year. The financial impact of these accidents leads many Alabama residents to seek insurance to protect their interests following a crash – but how does getting into a car accident impact your insurance rate overall? While you need to file a car insurance claim to receive compensation for your injuries, making a claim can also raise your monthly premiums.

Will Your Insurance Premiums Increase After Your Accident?

Not all Alabama insurance policyholders will see an increase in their car insurance rates after getting into a car accident. You will have to examine the specific terms of your policy to determine if your insurance company will raise your rates. Typically, if you were not at fault for the accident, you may not see an increase in your rates at all – or at the very least, the increase will be lower than it would be if you caused the accident.

Your driving record will also come into play when your insurance company is making a decision on whether to raise your rates. If you have a history of other accidents or traffic violations, your company will likely raise your premium. The lengthier your accident history is, the higher your rates will likely rise. In addition, the severity of your accident could increase your rates – if your accident involves high amounts of property damage or bodily injury, you can see additional increases. Minor accidents do not typically see high premium increases, if the insurance company decides to raise your rates at all.

What If You Were Not At Fault for Your Accident?

In most cases involving a car accident where another driver’s negligence led to your injuries, you will not see an increase in your insurance premiums. However, your insurance could still increase your premiums even if the accident is not your fault.

For instance, if you have lots of accidents on your Alabama driving record, your insurance company could still increase your rates in situations where you do not cause the accident. They will increase your rates because high numbers of accidents deem you to be a high-risk driver, and the company wants to cover their bases by charging you a higher premium.

How Much Will My Rates Increase?

If you want to know the exact amount your car insurance rates will increase after an accident, you will have to examine the terms of your policy or speak to your insurance company. The amount your rates will increase will depend on your driving history, the liability in the accident, and the severity of the crash. However, we can examine a few averages that point to how high you can expect your insurance rates to increase.

According to a 2015 study from Quadrant Information Services, the average driver who was at fault for the accident can make a single insurance claim of $2,000 or more and see his or her insurance premium increase by an average of 41%. However, this data is a nationwide average – Alabama statistics can differ. In 2016, Alabama had the 18th highest annual premiums for drivers at $1,337 per year. The average premium increase for the first accident for an at-fault driver is approximately 28%.

Your premium increases will not remain in place forever. On average, your increase will last between three to five years before your premiums return to the amount you were paying before your claim. However, if you file another claim during that time period, you can see additional premium increases and you will not return to pre-claim premium levels for a longer period of time.

If you suffer injuries in a car accident in Alabama and you did not cause the accident, contact a car accident attorney as soon as possible to determine your legal options. Your attorney can help you prove liability in your claim so you can lower your potential premium increase.