How Much Does Car Insurance Go Up After an Accident?

After a car accident, you’re likely feeling the anxiety, distress, uncertainty, and other after-shocks that usually follow. On top of coping with injuries, vehicle damage, and potential legal issues, you may worry about how this incident could affect your auto insurance rates.

Even if you weren’t at fault for the accident, you might still wonder whether you must pay more for insurance if you file a car accident claim. “Will my auto insurance rate go up after an accident?” is a question our Longmont car accident lawyers often hear from clients. 

While every situation is unique, understanding how accidents could affect your insurance premium might help ease your anxiety. 

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Denver Car Accident Guide

• Understanding Insurance Rate Increases After a Car Accident
• Colorado Laws Governing Auto Insurance Rates
• Will my insurance go up if I’m not at fault in Colorado?
• What to Do If Your Insurer Raises Your Premium for an Accident That Wasn’t Your Fault
• How Much Does Insurance Increase After a Claim?
• How Long Does an Accident Affect Your Insurance Rates?
• Can You Lower Your Insurance Rate After a Car Accident?
• Signs That You Need a Car Accident Attorney
• Taking on Insurance Giants Alone Could Cost You Big
• Call Fuicelli Lee’s Car Accident Lawyers Today

Understanding Insurance Rate Increases After a Car Accident

Auto insurance companies use several factors to determine your premium, and your driving history plays a significant role. If you’re involved in a car accident, the biggest factor that could affect your insurance premium is whether or not you caused the accident.

Still, the insurance you pay after a car accident varies widely, not just by company but by state.

Other factors, too, could make a significant difference in your insurance premium: 

• Fault determination
• The severity of the accident
• Your previous driving record
• Your insurance company’s policies
• Your state’s laws and regulations

Looking deeper into each of these factors should give you a clearer picture of what to expect.

Fault Determination

Whether you were at fault for the car accident is usually the biggest determining factor of how much your insurance rates may increase. Generally, if the investigating authorities and your insurance company determine you were to blame, you’re more likely to see a significant rate hike. However, even if you weren’t at fault, your rate might still go up in some cases.

At-fault accidents

If you’re responsible for the accident, you can typically expect your rates to increase more substantially. Insurance companies view at-fault accidents as indicators of higher risk, which translates to higher premiums.

Not-at-fault accidents

In theory, your rates shouldn’t increase if you weren’t at fault. However, some insurance companies may still raise your rates, especially if you’ve been involved in multiple not-at-fault accidents. This practice varies by insurer and state regulations and we recommend reviewing your policy with your insurance carrier.

Severity of the Accident

The seriousness of the accident also influences rate increases. Generally, minor fender benders have less impact on your premiums compared to major accidents that result in significant property damage or injuries.

Factors that insurers consider when assessing accident severity include:

• Total cost of damages
• Injuries sustained by involved parties
• Whether the accident resulted in a total loss of the vehicle

The more severe the accident and the higher the resulting insurance payout, the more likely you are to see a substantial rate increase.

Your Previous Driving Record

Your driving history before the accident is another important factor insurance companies use to determine a rate change after an accident. Your insurer may not raise premiums as much if you have a clean record with no previous accidents or traffic violations. Some insurance companies offer accident forgiveness programs for first-time offenders with otherwise spotless records.

On the other hand, with a history of accidents or moving violations, adding another incident to your record could result in a substantial rate hike. Insurance companies view drivers with multiple incidents as higher-risk clients, often leading to steeper premium increases.

Insurance Company Policies

Each insurance company has its methods for calculating rate increases after an accident. Some may raise rates dramatically after a single incident, while others might be more forgiving. Money-saving policy differences are one reason to shop around and compare quotes if you find your rates have increased significantly after an accident.

Some companies offer accident forgiveness programs, which can help protect you from rate increases after your first at-fault accident. However, these programs often come at an additional cost and may have specific eligibility requirements.

State Laws and Regulations

Insurance regulations vary by state, and these laws can impact how much your rates may increase after an accident. Many states have laws limiting how much insurers can raise rates after accidents or under specific circumstances. 

Colorado Laws Governing Auto Insurance Rates

In Colorado, several laws and regulations affect how insurance companies handle rate increases after accidents:

1. Fault determination: Colorado is an “at-fault” state, meaning the driver responsible for causing the accident is also responsible for covering the resulting damages. This can lead to higher rate increases for at-fault drivers than those in no-fault states.
2. Tort system: Colorado follows a tort system for car accidents, meaning the injured party can sue the at-fault driver for damages. Higher insurance payouts often mean higher rate increases for at-fault drivers.
3. Mandatory insurance requirements: Colorado law requires all drivers to carry minimum liability coverage of: 

• $25,000 per person for bodily injury
• $50,000 per accident for bodily injury
• $15,000 per accident for property damage

If your accident damages exceed your policy limits, you may face additional financial responsibility, affecting your future rates.

1. Colorado Consumer Protection Act: This law protects consumers from unfair or deceptive practices by insurance companies. While it doesn’t directly regulate rate increases, insurers must not hide their pricing practices.
2. Colorado Division of Insurance oversight: The state’s Division of Insurance monitors insurance companies to ensure they comply with state laws and regulations, including rate increases.

While Colorado’s insurance laws and regulations provide a framework, insurance companies may still find some leeway in determining rate increases within these margins.

Will my insurance go up if I’m not at fault in Colorado?

Generally, your insurance rate will not go up in Colorado after an accident for which you had no fault, thanks to a specific law addressing this concern. Colorado Revised Statutes Title 10. Insurance § 10-4-628 provides that:

“No insurer shall cancel;  fail to renew;  refuse to write;  reclassify an insured under;  reduce coverage under, unless the reduction is part of a general reduction in coverage filed with the commissioner;  or increase the premium for, unless the increase is part of a general increase in premiums filed with the commissioner, any complying policy because the applicant, insured, permissive user, or any resident of the household of the applicant or insured has:

(a) Had an accident or accidents that are not the fault of such named applicant, insured, household member, or permissive user …”

However, your insurer could still legally raise your insurance premium after an accident that wasn’t your fault for other reasons.

For instance, if you have filed multiple claims in the past, even for accidents or incidents that weren’t your fault, your insurer could raise your rates. Or, if you had multiple accidents that weren’t your fault, or your overall driving record indicates you are a high risk, your insurance company might raise your insurance premium. 

What to Do If Your Insurer Raises Your Premium for an Accident That Wasn’t Your Fault

Colorado law permits you to protest if your insurer violated Colorado §10-4-628 by wrongly raising your premium after an accident that wasn’t your fault.

Under the law, the insurer must notify the policyholder of the rate change and include all information about the change required by law. The insurer must also inform the policyholder of their right to dispute the proposed action and request a hearing before the Insurance Commissioner. 

The Colorado Division of Insurance investigates complaints that individual consumers file against an insurer. The agency’s investigation could result in a financial recovery or reinstatement of a policy canceled by the insurer, or both. 

How Long Does an Accident Affect Your Insurance Rates?

Another common concern is how long an accident will continue to impact your insurance rates. While this can vary by insurer and state, accidents typically affect your rates for three to five years. The impact on your rates may decrease over time if you maintain a clean driving record following the accident.

Some insurers use a surcharge schedule that gradually reduces the premium increase over time. For example, you might see the full increase in the first year after the accident, 75% of the increase in the second year, 50% in the third year, and so on until the accident no longer affects your rate.

Can You Lower Your Insurance Rate After a Car Accident?

While you may not completely prevent a rate increase after a car accident, to minimize the impact:

1. Report the accident accurately: Provide a thorough and honest account of the accident to your insurance company. Hiding details or misrepresenting the incident may lead to severe penalties.
2. Consider not filing a claim for minor accidents: If the damage is minimal and you can cover the costs out-of-pocket, it might be worth avoiding an insurance claim to prevent a rate increase.
3. Take a defensive driving course: Some insurance companies offer discounts for completing approved defensive driving courses, which could help offset potential rate increases.
4. Increase your deductible: Opting for a higher deductible can lower your overall premium, potentially counterbalancing some of the increase from the accident.
5. Shop around for new insurance: Different companies have different accident management policies. If your rates increase significantly, try getting quotes from other insurers.
6. Maintain a clean driving record: Avoiding further incidents in the years following your accident can help your rates return to normal more quickly.
7. Ask about accident forgiveness: If your insurer offers accident forgiveness and you’re eligible, this could prevent a rate increase for your first at-fault accident.

Signs That You Need a Car Accident Attorney

You may wonder whether you need a lawyer after a car accident. While not every fender bender requires the help of a lawyer, there are many cases where legal help can make a big difference in the outcome of your case. 

Recognizing these signs can save you time, stress, and potentially thousands of dollars in the long run. From disputes with insurance companies to complex personal injury cases, many situations call for an experienced and skilled car accident lawyer to help you get the compensation you deserve. 

Consider consulting a car accident lawyer if:

• You were injured in the accident, even if your injuries may seem mild
• The accident involved multiple parties
• An insurance company is disputing fault or liability
• An insurance company is pressuring you to accept a quick settlement
• An insurance company denied your claim, and you believe their denial is unjust
• The insurance company’s offer doesn’t cover all your expenses and losses

Taking on Insurance Giants Alone Could Cost You Big

A car accident can be costly in many ways beyond higher insurance premiums. 

If you suffered injuries in a car accident that wasn’t your fault, partnering with a skilled and experienced car accident attorney is one of the most important steps you can take to protect your rights and your future. 

An insurance company for the at-fault party will likely contact you soon after the accident. They may pressure you into accepting an offer that fails to cover all of the expenses you’re facing after the car accident – the medical bills, lost work, and all the pain and suffering you’ve endured. 

Insurance companies are businesses focused on maximizing their profits, which means minimizing their payouts to claimants. They may make you a quick offer to close your case. As tempting as the offer may be to accept, the instant relief it may provide will likely be far less than you need and deserve. 

A car accident lawyer will account for all of your physical, emotional, and financial hardships. They will hold the insurance company accountable for paying you every dollar you deserve. At Fuicelli & Lee, we level the playing field. We never let big insurance corporations hustle our clients out of a full, fair, and complete settlement. 

Call Fuicelli & Lee’s Car Accident Lawyers Today

Being involved in a car accident is stressful enough without worrying about how it will affect your auto insurance premium. Every case is unique, and what happens to your rates depends on fault, your driving history, your insurance company’s policies, and your state’s laws. 

While your rate could increase even if you weren’t at fault, you can minimize some of the extra costs associated with a car accident. If you suffered injuries in a car accident that was not your fault, our team of results-driven car accident lawyers can help you. 

Call Fuicelli & Lee Injury Lawyers today at (303) 444-4444 or fill out our online form to request a free, no-obligation consultation with a top-performing car accident lawyer. We work on a contingency basis, so we don’t get paid unless we win your case. Car accidents can be costly in many ways, but getting excellent legal representation shouldn’t be one of them.