Can You Change Car Insurance After an Accident?

Car insurance protects individuals from significant costs arising from unexpected vehicle events. It is a contract where policyholders pay premiums for coverage against financial losses, including vehicle damage, injuries, and property damage to others. Most states require a minimum level of car insurance, typically liability coverage, to ensure drivers can cover damages they might cause.

Changing Coverage for a Past Accident

Car insurance policies cover future events, not incidents that have already occurred. Attempting to retroactively modify your coverage for a past accident is considered insurance fraud, even if the accident has not yet been reported.

Insurance fraud carries severe consequences, including policy cancellation, denial of claims, and legal penalties. Misrepresenting the timing of an accident can lead to policy cancellation, leaving you without protection and potentially facing fines or imprisonment. Such actions can also make it difficult to obtain future insurance coverage, as fraudulent activity is noted on your insurance history.

Adjusting Your Policy After an Accident

While you cannot retroactively change your policy for a past accident, you can make prospective adjustments after an incident has been reported and processed. Policyholders adjust coverage for reasons like changes in financial situation, vehicle usage, or to alter future risk. These adjustments aim to optimize future protection based on new circumstances.

Common adjustments include modifying deductibles, the out-of-pocket amount paid before coverage begins. A higher deductible typically results in lower premiums, while a lower deductible leads to higher premiums. Other changes might involve adding or removing specific coverages, such as rental car reimbursement, roadside assistance, or altering comprehensive and collision coverage limits. Contact your current insurer to discuss these modifications and align your policy with your evolving needs.

How Accidents Affect Insurance Premiums

An accident, particularly one where the driver is deemed at fault, can significantly impact insurance premiums. Insurers view drivers involved in accidents as higher risk, leading to potential rate increases upon policy renewal. The extent of the premium increase is influenced by several factors, including the severity of the accident, whether it was an at-fault or not-at-fault incident, the type of claim filed, and the driver’s history.

Even a minor accident can lead to a noticeable increase, and the national average increase after an at-fault accident can be substantial, often around 44% to 47% for full coverage. Some insurers offer accident forgiveness programs, which might prevent a single accident from immediately raising rates, but eligibility often depends on the driver’s history and the policy type. An accident typically remains on a driver’s record, affecting insurance rates, for a period ranging from three to five years, though this can vary based on the insurer and the specific circumstances of the incident.

Switching Insurers After an Accident

After an accident, especially if rates with the current insurer have increased, exploring options with other insurance providers is common. It is possible to switch car insurance companies even with an open claim or a recent accident on your record. Your previous insurer remains responsible for handling claims that occurred while their policy was active, regardless of whether you switch.

When seeking new quotes after an accident, transparency about your driving and claims history is paramount. Insurers access databases that record past accidents and violations, so misrepresenting this information can lead to policy cancellation, denied claims, or even allegations of insurance fraud. While a new insurer will factor in the accident when calculating your premium, comparing quotes from multiple companies can help identify a more favorable rate. It is important to ensure continuous coverage when switching to avoid any gaps that could leave you uninsured.