Filing a claim doesn't automatically mean your car insurance premiums will jump. Some claims signal a higher risk to car insurance companies, while others don't. If your rates do rise, the increase typically lasts three to five years, depending on your insurance provider, state regulations, and your driving record.
- Rate Increases By Claim Type
- How Long Does a Claim Affect Your Rates?
- Should You File or Pay Yourself?
- Factors That Affect Rate Increases
- How to Avoid Rate Increases
- Why Comprehensive Claims Typically Don't Increase Rates
- What About Not-At-Fault Claims?
- Non-Renewal: The Risk of Too Many Claims
- Should I File This Claim?
- FAQs
Quick Answer: How Filing a Claim Affects Your Insurance Rates
Filing an insurance claim can affect your insurance rates, but not every claim leads to premium increases. Understanding which type of claim triggers a rate hike, how long it affects your insurance policy, and how insurance companies evaluate risk can help you decide whether to file or pay out of pocket.
Claims that typically don't increase rates:
- Comprehensive claims
- Not-at-fault accidents, depending on your state
- Windshield-only claims, depending on your state
Some auto insurance carriers offer accident forgiveness, which can prevent a surcharge after your first at-fault accident.
Rate Increases By Claim Type
At-Fault Collision Claim
An at-fault accident usually results in higher premiums because insurers see it as a sign of higher risk. Your car insurance rate could increase up to 50%, depending on your insurance provider, the claim amount, and your driving history. These increases generally stay on your record for three to five years unless you can take advantage of accident forgiveness benefits for your first claim.
Not-At-Fault Collision Claim
A no-fault accident or not-at-fault accident may still cause a small rate increase (sometimes up to 20%) depending on the state and insurer. Several state laws prohibit rate increases for not-at-fault accidents, which helps shield your auto insurance rates from changes. These rates can stay inflated for up to three years if an increase applies.
States that prohibit rate increases for not-at-fault accidents:
- California
- Oklahoma
- Several others with restrictions
Comprehensive Claim (Theft, Weather, Vandalism)
Most insurance companies don't increase rates for comprehensive claims because they're unrelated to driving behavior. Weather damage, theft, vandalism, or hitting an animal aren't indicators of higher risk on the road. If a rate hike occurs, it's usually below 10%.
Why there's usually no increase:
- Acts of nature or crime aren't your fault
- No indication of risky driving behavior
- Doesn't reflect a poor driving record
Multiple comprehensive claims in a short period, however, may trigger higher rates.
Glass/Windshield-Only Claim
Many states allow zero-dollar deductible windshield repair under your insurance policy. Florida and South Carolina require insurers to waive the deductible, so you can file a windshield insurance claim without worrying about a premium increase. In most other states, the comprehensive deductible applies, but these claims usually don't affect your car insurance premium.
Multiple Claims
Filing multiple claims within a three-year period usually results in higher premiums, and in some cases, a risk of non-renewal of your car insurance policy. Too many claims signal high risk to insurers, which can result in dramatically higher deductibles, a potential risk of insurers canceling coverage, or difficulty finding competitive insurance coverage options.
How Long Does a Claim Affect Your Rates?
When you file a claim, your insurance costs don't immediately change, but rather at your next policy renewal. Insurers don't typically change rates mid-term, so you should have time to prepare or shop around if you expect a rate increase.
An insurance claim may stay on your record for up to seven years, depending on the state you live in and which insurance company your policy is with. Most insurers only allow claims to impact your rate for around three years. However, new insurers can typically see claims up to seven years old, which may affect your ability to get coverage through certain companies.
Should You File or Pay Yourself?
There are some instances where it may be worth paying out of pocket for a repair rather than filing a claim. There's a simple formula to help you decide:
- Determine the cost to repair the vehicle
- Determine your total cost of filing: (three years x annual rate increase) + deductible
- Compare your repair cost to the total cost of filing
Small Damage Example: Backed Over Mailbox
If you backed over your mailbox, causing damage to your vehicle, you may find yourself with only minor damage and considering whether it's worth filing a claim. No other vehicles are involved, no medical payments are necessary, and with minor damage, it might not be worth the long-term impact a claim would have on your premiums.
Cost Analysis (for example only, actual figures will vary)
- Repair cost: $1,800
- Current premium: $1,500/year
- Deductible: $500
- Expected new premium: $2,100/year ($600 annual increase)
| Paying Out of Pocket | Filing a Claim |
|---|---|
| Repair Cost = $1,800 | (3 years x $600) + $500 |
| Total Cost = $1,800 | Total Cost = $2,300 |
A small accident like this, especially with a clean driving record, is usually not worth filing. You'd be better off paying for the repair yourself if you have the extra cash on hand.
You should always file a claim when:
- Vehicle or property damage exceeds $5,000
- A vehicle is totaled
- Injuries occur
- There's third-party liability
- It's a comprehensive claim
Factors That Affect Rate Increases
Several issues affect how much your insurance rates increase after a claim, beyond just the type of claim:
- Driving history: If you have new traffic violations or a new claim indicates a pattern of risky behavior
- Claim severity: Big losses, especially in a car accident, may increase your rates more than minor claims under $5,000. Bodily injury claims, likewise, tend to increase rates more than property-only claims
- Insurance company: Some companies offer accident-forgiveness policies that either don't increase your rates at all or increase at a lesser amount
- State laws: Some states limit or outlaw increases for not-at-fault accidents; some even limit increases for at-fault incidents
- Time since last claim: If your last claim was five or more years ago, your current claim may be treated as an isolated incident; however, if you have multiple claims back-to-back, you may see a larger increase
How to Avoid Rate Increases
Accident Forgiveness
Some insurers offer accident forgiveness to prevent rate hikes after your first at-fault accident. Insurers apply the benefit differently: some apply it as a reward for good driving, where it kicks in after a certain amount of time without a claim or infraction and reduces your premium; other insurers apply it after your first accident to waive the expected rate increase.
Key limitations:
- Usually only covers your FIRST at-fault accident
- May reset after several years
- Doesn't cover tickets or violations
- Some companies require you to earn it through loyalty or a long period of safe driving
How To Minimize Rate Increases After Filing
After filing a claim, you might take one of several options to reduce your insurance costs.
1. Shop around immediately: Different companies weigh claims differently. Some companies are better for drivers with an accident history or are more forgiving of claims. Shop specifically with companies that advertise "accident forgiveness."
2. Increase your deductible: If a higher monthly payment isn't an option, you may consider opting for a higher deductible to offset rate increases. Higher deductible policies typically offer lower premiums, but you'll owe more out of pocket in the event you need to make another claim.
3. Take a defensive driving course: A defensive driving course is a great option for drivers with a new infraction on their license or a recently filed claim. The cost is typically minimal and requires less than a day of study, but it demonstrates to your provider that you have the initiative to improve your driving behaviors. Ask your provider about approved courses that offer discounts upon completion.
4. Ask about accident forgiveness retroactively: It might be worth contacting your insurance agent to find out if accident forgiveness can be retroactively added to your policy. Some companies may apply it retroactively for a fee, but it never hurts to ask!
5. Maximize other discounts: If you weren't already taking advantage of every discount possible through your insurer, now may be the time to get serious about discounts. A larger discount, like bundling auto and home insurance, or stacking smaller discounts, like auto-pay and electronic billing, may be enough to offset your increases.
Why Comprehensive Claims Typically Don't Increase Rates
Comprehensive auto insurance claims typically don't increase your insurance premiums because they involve events outside of your control. This includes weather-related damage like flooding, tornadoes, hail, hurricanes, or falling tree branches from excessive wind. Comprehensive claims also cover theft, vandalism, and damage from hitting an animal like a deer. Because these claims are no-fault and don't reflect poor or risky driving behavior, they rarely trigger a claim increase.
Filing a comprehensive claim is almost always in your best interest unless you've filed several claims recently, as multiple comprehensive claims may signal higher risk and lead to higher rates.
What About Not-At-Fault Claims?
Even with a not-at-fault accident, your insurance rates may still increase. Many insurance providers consider all drivers involved in collisions, regardless of fault, to be slightly higher risk. However, state laws vary: some states prohibit rate increases for not-at-fault accidents, while others operate under no-fault insurance, where your car insurance policy covers your own property damage and medical expenses regardless of who causes the accident.
| At-Fault | No-Fault | Choice No-Fault |
|---|---|---|
| The driver (and their insurance) deemed responsible for the accident pays the other parties' damages and injuries through their insurance coverage. | Each party's auto insurance pays for their own expenses, including medical and other losses, regardless of fault. | Drivers can choose whether their car insurance policy operates under no-fault or at-fault rules. |
| Alabama, Alaska, Arizona, Arkansas, California Colorado, Connecticut, Delaware, District of Columbia, Georgia, Idaho, Illinois, Indiana, Iowa, Louisiana, Maine, Maryland, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Carolina, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming | Florida, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New York, North Dakota, Utah | Kentucky (defaults to at-fault if no policy is selected) New Jersey, Pennsylvania (defaults to no-fault if no policy is selected) |
Non-Renewal: The Risk of Too Many Claims
Even if each claim doesn't trigger a premium increase, filing multiple claims in a short period can affect your car insurance policy. Insurance companies consider drivers with multiple insurance claims a higher risk.
Most insurers tolerate two claims in three years, but a third claim can trigger a review for non-renewal, meaning that your insurance provider may choose not to extend coverage when your policy expires.
Drivers with several claims often face higher rates and may be limited to minimum liability coverage. This can restrict the number of car insurance companies willing to offer competitive auto insurance rates and may reduce available insurance coverage options.
Should I File This Claim?
If the answer to any of these questions is "yes," then you should file a claim:
- Is it a comprehensive claim (theft, weather, vandalism, animal)?
- Is anyone injured?
- Are other vehicles involved?
- Is the damage more than $5,000?
If the answer to all the above questions is no, then compare the repair cost with your total cost should you file a claim (deductible + annual increase x three years). If the repair cost is lower, consider covering out of pocket to avoid long-term premium increases.
FAQs
How much does insurance go up after a claim?
It depends on the type of claim. If your claim falls under your comprehensive policy, you typically won't see an increase. For collision claims, you might see an increase when your policy renews, depending on your insurance company and whether or not you have accident forgiveness. Multiple claims, regardless of claim type, typically result in premium increases. The amount of increase depends on your insurer and your coverage, but some can see up to a 50% increase.
Will my insurance go up if I file a claim?
Possibly. Comprehensive claims typically don't increase premiums unless you file multiple claims in a short time. Not-at-fault accident claims may increase your premium slightly or not at all. Some states prohibit premium increases for not-at-fault claims. At-fault claims may increase your premiums up to 50% depending on your provider, your coverage, and whether you have accident forgiveness.
How long does a claim affect your insurance rates?
Claims will typically affect rates for three to five years, after which a claim might drop off and result in lower premiums, assuming you file no new claims. The timeline depends on your state and insurer.
Does a not-at-fault accident increase insurance?
Some states, like California and Oklahoma, prohibit rate increases for not-at-fault accidents. However, most states have no such policy, and premiums may go up, albeit typically not as much as if it were an at-fault accident.
Should I file a claim or pay out of pocket?
If the repair cost is less than the cost of your deductible plus the rate increase over three years' time, it might be worth paying for the damage yourself. A reasonable rule of thumb is to file for damage that exceeds $5,000. If another vehicle is involved or there are injuries, you should file a claim.
How many claims before insurance drops you?
Most insurers will tolerate two claims in a three-year period, but a third claim within that time frame might result in non-renewal. A pattern of frequent claims signals high risk to insurance companies.
Does a comprehensive claim raise rates?
Not usually. A comprehensive claim typically will not increase your rate because it's not associated with driving or risky behavior. However, if you file multiple comprehensive claims in a short period of time, you might see a small increase.
What happens after you file an insurance claim?
An insurance adjuster will investigate your claim and determine whether it's covered based on your policy. They'll require the vehicle's current mileage, details of the accident, photos/videos of the damage, and a police or accident report for collision claims. If they determine the damage is covered under your policy, they'll negotiate a fair payout to either cover a repair or total the vehicle.
