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How Will a Motor Vehicle Accident Affect My Insurance?

Feb 3, 2020 | Auto Accident


It is no secret that those who have not been in any traffic accidents in many years (or not at all) can find great insurance premiums. Still, some are concerned about how an accident will affect their vehicle insurance payments.

Understanding how insurance works can help you pick a plan that works best for you. Choosing a plan carefully can help you strike a reasonable balance between paying less each month and protecting yourself financially after a major accident.

Determining Who Is at Fault for the Accident

Indiana is an at-fault state, meaning police will draft a report naming the party at fault. While insurance will take the police report into account, they will hold a separate investigation with a claims adjuster in order to determine which insurance company must pay for injuries and damage to property.

In some cases, the police and/or the insurance company may distribute fault comparably. This means that there is enough negligence in more than one party to declare each one at fault comparably, or by percentage.

Accidents that involve property damage may remain on your driving record for up to three years. If the police determined that you violated traffic laws resulting in an accident, the citation will also go on your record and have a greater negative impact. Both can also have negative effects on your insurance.

Your Insurance Could Change

If you are accident-prone, your insurance will cost more. Without accident forgiveness on your policy, insurance companies are permitted to increase your premium if you are involved in an accident (whether or not you were at fault). 

It is more likely that your insurance will increase premiums if you are found at fault for an accident. That being said, you may or may not see an increase in your insurance if the other driver’s insurance company claims responsibility.

How Accident Forgiveness Works

Many insurance companies offer their customers accident forgiveness. This is typically an extra charge that keeps your insurance premiums from increasing should you be involved in a car accident. Depending on the insurance company, the accident forgiveness is usually a small, extra charge that makes it a reasonable upgrade to keep insurance premiums from rising in the event of another vehicle accident.

Insurance Claim Limits

If you or someone you love is involved in a major car accident, regardless of who was at fault, damages can exceed insurance limits and leave you to pay the balance of bills owed. For example, if the cost of repairing/replacing your car after an accident exceeds $25,000 (the Indiana state liability minimum), you are liable for anything over $25,000. 

For this reason, many people increase their insurance liability amount so they don’t get stuck paying for extra costs in the wake of an accident. While this will protect you financially after an accident, it also means that your insurance will cost you more.

Injuries Suffered from the Accident

Injuries after an accident prove even more difficult when it comes to insurance payouts. Any significant injuries can easily cost more than the state minimum injury liability of $25,000 per person. 

If you or someone you love is injured in a traffic accident, and the other driver was found at fault, you may be eligible for compensation in a personal injury lawsuit beyond what that driver’s insurance will provide. 

That said, of greater concern than your rising premium should be the cost of injuries after a traffic accident. It is important that you consult with an experienced personal injury attorney as soon as possible after your accident.

For more information about how an Indiana attorney can help you with your motor vehicle accident case, contact Stewart & Stewart Attorneys at 800-333-3529 or visit our website.

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