Every year there are hundreds of thousands of accidents on the national road network. If you have been involved in a traffic related problem, you may want to know how does an accident affect insurance cost. Though vehicle collisions are never a happy situation, they do not always result in a dramatic increase in the cost of auto insurance. The information discussed below should help you to deepen your understanding of this subject matter.
It can happen that just by submitting a claim, the cost of the policy will increase. Certain insurers do not raise their rates on the first claim, though others do. Always research this information prior to taking out a new policy.
How an accident impacts upon the cost of insurance would depend in part on who is at fault. Insurers typically classify accidents as being the drivers fault or not at fault. If you have an accident and have been found to be at fault, the insurer is likely to raise the premium to reduce their risk. Not-at-fault claims do not usually result in a higher policy cost, though an excess of such claims can bring about a policy review.
When submitting a claim to an insurer, it can have an impact on your eligibility for specific discounts. If you have been accident free for a considerable amount of time, and because of this had availed of a no claims discount, this reduction may no longer be available after making a claim. Always think carefully about whether the cost of paying out from your own pocket would be more desirable than losing your no claims bonus.
It is possible for a policy to be cancelled if the number of claims made passes a specific threshold set by the carrier. This is a situation which should be avoided at all costs, being viewed as an insurable risk is not desirable at any time. Once an insurer has cancelled a policy, it can then be extremely difficult finding another carrier who would be willing to provide cover.
Those drivers that have been charged with a serious traffic violation, such as a DUI or reckless driving, should expect that the cost of their premium will shoot up considerably. Not only can being a responsible driver ensure your safety and wellbeing, and that of other road users, it can also help in saving you hundreds of dollars on an annual basis.
