Just being involved in an accident can be stressful – and even more so if your car insurance premiums go up because of it.
Well, it’s bound to happen because accidents do indeed impact your insurance rates. That’s why it’s important to know that there are steps you can take to mitigate the pending rate increase or avoid it altogether.
Let’s explore 12 helpful tips to help minimize the damage an accident can do to your monthly insurance bills.
1 – Don’t delay reporting an accident you’re involved in
When an accident happens, report it to your car insurance provider immediately. That’ll start the claims process and allow enough time to fully assess the damages. Any delay in reporting the accident may result in claim complications or a denial of coverage.
Be prepared to provide accurate and detailed information about the accident, including the date, time, location, and the names of anyone involved. Take pictures of the surrounding areas and the damage to all cars or property involved. By being responsive throughout the claims process, you will likely see a smoother, faster resolution.
- Pro tip: Keep a copy of the accident report and any supporting documents for your records.
2 – Assess all damage and repairs
Before filing a claim, make sure you understand the damage to your vehicle and get a professional to estimate the cost of repairs. Sometimes, it may be better to pay for minor damages out of pocket instead of involving your insurance company.
By avoiding small claims court, you can maintain a clean claims history and potentially prevent future insurance premium increases.
- Pro tip: Consult with a trusted mechanic or body shop to get an accurate estimate of the repair costs.
3 – Carefully consider comprehensive coverage
Comprehensive coverage protects your vehicle against damages that aren’t a result of a collision, like theft, vandalism, or damage from natural disasters.
If your car is older and the cost of comprehensive coverage seriously outweighs its value, consider dropping it. Doing so can lead to immediate savings on your monthly premiums.
- Pro tip: Evaluate the current market value of your vehicle and weigh it against the cost of comprehensive protection.
4 – Bundle your policies
If you have multiple insurance policies (like homeowner and car insurance) with different providers, consider bundling them together under one insurance company.
Bundling policies can often lead to discounts on both policies, saving you hundreds of dollars annually.
- Pro tip: Compare quotes from several insurance companies to pinpoint the best deals on policy bundling.
5 – Explore accident forgiveness
Some insurance providers offer accident forgiveness as part of their offering. If your insurance company is one of them, take them up on it.
With accident forgiveness, you’ll protect your rates from increasing after your first at-fault accident. Once again, compare insurance company offerings before switching.
- Pro tip: Check with your insurance provider to determine whether they offer accident forgiveness — some might even allow for retroactive forgiveness.
6 – Dig into available discounts
When reporting the accident, ask about potential discounts that may apply to your policy. Many insurance companies offer safe driver deals, loyalty rewards, and even student driver discounts for good grades.
By taking advantage of discounts, you can offset the hit your accident will have on your premium.
- Pro tip: Ask for a comprehensive list of available discounts and determine which applies to your situation. Remember, bundling car insurance with other policies, like renters’ insurance, can save you a nice chunk of change.
7 – Maintain good credit
Believe it or not, studies have shown a correlation between responsible financial behavior and safer driving, so insurance companies use your credit score when calculating rates.
To keep your car insurance premiums in check, keep your credit score in good shape by paying bills on time and managing how much of your available credit you’re actually using (less is better).
- Pro tip: Regularly review your credit report to identify and dispute inaccuracies that may decrease your overall score.
8 – Take a defensive driving course
A clean driving record can lower your car insurance rate. After an accident, you’ll want to demonstrate a commitment to responsible driving. By avoiding traffic violations and accidents, you can qualify for better insurance rates.
Even better, completing a defensive driving course shows that you’re serious about being a safer driver. Many insurance providers offer lower rates to policyholders who can prove they’ve completed these courses.
- Pro tip: Check with your insurance company to see which defensive driving courses they recognize and how much you can save.
9 – Opt for higher deductibles
One way to lower your monthly premium is by choosing a higher deductible — the amount you pay out of pocket before your insurance coverage kicks in.
By increasing your deductible, you assume more risk; in return, most insurance providers will offer to lower your premium.
- Pro tip: Make sure you have enough savings to cover the higher deductible in case of another accident.
10 – Look into a usage-based policy
Also known as “pay-as-you-drive” insurance, a usage-based policy uses a telematics device or a smartphone app to monitor your driving behavior — like mileage, speed, and braking patterns — and adjust your rates accordingly.
If you’re a safe driver, “pay-as-you-drive” insurance can help soften the impact of an accident and could eventually lower your premiums.
- Pro tip: Review all privacy policies and data usage guidelines before agreeing to usage-based insurance.
11 – Shop around for better rates
Compare quotes from multiple providers. Rates can vary a lot — even in the same neighborhood, and shopping around helps you find the most competitive offers.
Remember to consider more than just price. Customer service, reputation, and coverage options are also important.
- Pro tip: The Baldwin Group can help you explore the best policies from the best insurers and get the best rates available. Request your free quotes now.
12 – Understand your policy
Take the time to review your car insurance policy in detail. Familiarizing yourself with coverage options, deductibles, and exclusions will help you understand exactly what your insurer uses to determine rate increases.
And, as your driving habits change, your insurance needs may also change. So, review your coverage annually and explore alternatives that can lower your premiums.
- Pro tip: Reach out to your insurance agent or company representative to clarify any policy-related questions you may have.
Accidents Happen
It’s true. But lowering car insurance premiums after an accident requires proactive measures and informed decision-making. Reporting the accident promptly, understanding your policy, assessing the value of comprehensive coverage, opting for higher deductibles, maintaining a good driving record, exploring discounts and bundling options, and shopping around for better rates are all effective strategies.
Consider each option carefully and tailor them to your specific circumstances, helping ensure you have the coverage you need at a price that fits your budget.
