Does Filing a Claim Raise an Auto Insurance Rate?

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Auto insurance can help pay for damage and losses that result from owning and driving a car, but you can't get compensation until you file a claim. An insurance claim is an official request for compensation under the terms of your plan. Filing a claim may prompt your insurance company to raise your monthly fees or premiums, but making a claim doesn't guarantee a rate increase.

Claims and Premiums

The premiums you pay for car insurance are based on the amount of cash your insurance company expects to have to pay out for the claims that you and other drivers make. Safe drivers tend to make few if any insurance claims, so they tend to enjoy lower rates than people with spotty driving records. When you make an auto insurance claim, it is a signal to your insurance company that you might not be a good driver, so it may respond by increasing your rate.

Influential Factors

Making an auto insurance claim can lead to a rate increase, but insurers don't always bump up rates after a claim. According to Esurance, the severity of the accident is the most important factor in determining whether a claim will lead to an increase in rates. A major accident that leads to a costly claim is more likely to have an impact on your rates than a minor fender bender. Fault alsoplays an important role: If you are a safe driver and someone else plows into your car, you are less likely to see a rate hike than you would if you had caused the accident.

Accident Forgiveness

Some car insurance companies offer "accident forgiveness" programs that keep your rates from going up after your first at-fault accident. Accident forgiveness may be offered as part of a safe driver customer loyalty plan, where you earn forgiveness for your next accident if you maintain a clean driving record for several years. In some cases, accident forgiveness is offered as an extra feature that you have to pay for.

Small Claims

Since claims have the potential to increase your insurance rates, you might be better off avoiding certain small claims, even if you could get money from your insurance company. For example, if your plan has a $1,000 deductible and you get into an accident that causes $1,200 of damage to your car, you are only entitled to $200 of compensation. In this case, you're probably better off paying the extra $200 for repairs yourself instead of risking a rate hike.