This is a question we frequently hear from clients who were involved in car or truck accidents but not at fault. Unfortunately, the answer to the question is: quite possibly.
According to the results of a 2017 study released by the Consumer Federation of America (CFA), drivers in some states may indeed see their auto insurance rates rise after an accident. If you're concerned about your car insurance rates going up after being involved in an accident you didn't cause, here's what you need to know.
Key Findings From the 2017 CFA Study
For the study, CFA examined online rate quotes from the five largest auto insurers in 10 major U.S. cities to determine if drivers who weren't deemed at fault pay more for their car insurance coverage after an accident. Not only did CFA researchers find this was in fact the case, they also found even safe drivers can see their insurance premiums rise by an average of $300 per year after being hit by another driver.
CFA analyzed online insurance rate quotes from Progressive, Geico, Farmers, Allstate, and State Farm: all of which applied accident-related surcharges differently. Progressive was the most liberal in their application of these surcharges, increasing insurance rates by an average of nearly 17 percent for every quote following a not-at-fault crash, except in states where raising rates on innocent drivers after an accident is prohibited by law.
Farmers and Geico applied surcharges less stringently, increasing their quoted rates by up to 10 percent occasionally. Allstate sporadically raised rates on drivers involved in accidents they didn't cause. State Farm was the only insurer included in the study that never raised quoted rates after a not-at-fault accident.
Low-Income Drivers Pay More
In another disturbing takeaway from the study, CFA researchers found that drivers with socio-economic characteristics associated with lower incomes paid more for car insurance than drivers with higher incomes—even if they both had the same safe driving record.
Why Insurance Rates May Rise After an Accident That Wasn't Your Fault
The way insurers decide when and how to apply surcharges after a not-at-fault accident varies dramatically. However, examples of reasons insurers may give for raising rates on drivers who weren't found responsible for their accidents include:
- The driver who caused the accident was uninsured or underinsured. When a driver seeks compensation through their insurance policy's uninsured or underinsured motorist coverage, insurers may apply a surcharge to their premiums, even though they didn't cause the accident.
- The policyholder was partially at fault for the accident. Car crashes are rarely 100 percent one driver's fault. If the insurer determines the policyholder was partially at fault for the collision, it may impose a surcharge that reflects the driver's culpability.
- Some statistics show that drivers who were involved in an accident are more likely to be involved in future accidents. If the insurer relies on such statistics to inform premium pricing, it may impose a surcharge.
Keeping Auto Insurance Rates Affordable
Car insurance rates are already high for many drivers, which can make after-accident increases particularly frustrating. There are few options for drivers who have such surcharges added to their premiums.
However, what drivers can do is comparison shop for a policy from another insurer or appeal a partially at-fault finding to see if they can get the surcharged removed. Should the driver decide to change insurance companies, they should find out exactly which circumstances lead to rate increases.
A Car Accident Lawyer You Can Trust
If you were injured in an accident caused by another driver's negligence, you may be entitled to compensation for damages, including medical expenses related to the crash. Contact Sevenish Law today to schedule a free initial analysis of your car accident case.