How to Keep Auto Insurance Rates Down after Filing a Claim

Getting in a car accident is never a pleasant experience. Even if no one gets hurt, you frequently have to deal with costly repairs and time-consuming paperwork and phone calls. After everything has been sorted, you have to keep an eye on your car insurance rates. If you’ve filed a claim, there’s a chance that your insurance premium will increase.

Insurance companies determine a customer’s premium based on an insurance score. This number is representative of how risky it is to do business with the client. A good insurance score means that a customer is unlikely to file an expensive claim and cost the insurance provider extra money. If you’ve been in an accident and filed a claim, that could mean an unfavorable change in your insurance score. People who have filed claims can be considered likely to do so again, thus customers with poor insurance scores are usually charged higher premiums.

Luckily, there are ways to keep your car insurance rates down, even after filing a claim. In fact, many auto insurance companies offer accident forgiveness. If you purchase this option from your provider, your rates won’t go up after your first accident. Some providers also offer bonuses if you are accident-free for a certain period. That’s something you can start working on right away. Others will reduce your deductible once you establish a period of safe driving. You should also look into auto insurance discounts and sure you’ve signed up for all that you are entitled to receive. While you can’t take back an accident, there are other ways you can change your lifestyle or finances to save money each year on your premium.

Factors that affect your car insurance rates

Deductible
Picking your deductible is crucial when you’re trying to keep insurance costs low. Raising your deductible can lower your premium and vice-versa. If you think that you’re unlikely to get in an accident, but still want the safety net of insurance, it makes financial sense to choose a higher deductible. But exercise caution making this move. Your deductible is how much you’ll pay out of pocket if you ever need to file a claim, so this amount should remain reasonable. As long as you always have your deductible on hand, you don’t have to worry about being strapped for cash after an accident. Keep this number affordable, and you will be able to file a claim with relative ease.

Coverage
When you’re purchasing car insurance, you can tweak aspects of your policy to save money. Which types of coverage you choose is one way you can hang on to a couple extra dollars each year. As a policyholder, you’re required by your state to hold a certain amount of liability protection. However, some other types of coverage are optional. Skipping out on all types of optional coverage may not be the best decision in terms of your finances. Choosing coverage types should be done based on self-assessed risk. If you see yourself needing a certain type of protection down the line, you’ll be doing your wallet a favor by spending a little more money on the extra coverage.

You should apply this same philosophy while choosing your coverage limits. A greater amount of insurance protection will increase your premium but protect you financially if you’re ever in an accident. Therein lays the gamble: Would you rather spend more money on insurance, or are you confident that you only need minimal protection?

Personal information


Driving habits: Steer clear of serious traffic violations to keep your rates low. Avoid tickets and don’t ever drive while intoxicated. Your mileage can also impact your insurance score. If you don’t drive many miles and you park your vehicle in a safe location, you can potentially lower your rates. Why you drive is also relevant. Whether you’re on the road for personal or professional reasons will affect your quote.

Make and model: When buying a vehicle, purchase a car that’s known for its safety features. A safe vehicle can secure a lower premium.

ZIP code: Some areas of the country are deemed higher risk than others. If you live in a city with few accidents, you might be able to get a lower car insurance quote.

Credit score: It might surprise some that insurance companies look up an individual’s credit score before giving them a quote. This check is usually a “soft pull” and will not affect your credit score. If you have a healthy credit score, this will only help your chances of paying a lower insurance rate.

Age: Older motorists generally have more driving experience, and experienced drivers are better at avoiding accidents. If you’ve been a licensed driver for quite some time, this might lower your insurance quote.

Gender: Maybe outdated adages argue that women are poorer drivers, but statistics show that men are more likely to get in an accident. If you’re female, your gender will work in your favor when it comes to insurance price.

Discounts

You can’t change your age or driving history, but you can definitely ask an insurance agent about discounts. Many insurance providers offer several discounts that are easy to obtain. Eligibility might come through some simple financial moves, such as paying your premium in full or buying your home and auto insurance from the same company. Young drivers can secure discounts by getting good grades in school or taking a defensive driving course. Equipping your car with safety features is also wise. You can get discounts for seat belts, airbags, anti-lock brakes or various anti-theft devices.

Get on the phone today with your insurance company to examine your options. Through tweaking your policy or qualifying for discounts, auto insurance doesn’t have to be a financial burden, even if you’ve had an accident.


C. Van Brunt-Wiley, is the Editor of the HomeInsurance.com blog.

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