The Effects Of Car Insurance Premiums After A Car Accident

It is well known by experienced drivers that car accidents happen in the blink of an eye; it is enough to be distracted for a short moment for us to be in the middle of a collision or any other accident that may have catastrophic consequences, not only because in the worst case scenario, it can cost a person his or her life, but because, at best, the damage caused by a collision or accident can result in a large sum of money that can severely affect a family’s finances.

Mentioning the previous statement, it’s always important to have a good car insurance. If you are thinking of getting a new one for your vehicle, there are many companies and types to choose from. We should also remember all the factors that help deciding your car insurance premiums, such as the age, type of vehicle, location, credit score, driving record etc. Most popular ones nowadays are full and extensive car insurances. On this article we will look into the unique services premium car insurance coverage offers and how they can change overtime depending on different situations.

Here are the most important benefits included in the most complete insurances (It should be noted that this type of premium is more expensive than normal and varies depending on the insurer)

1. Extension of civil liability: In this section, the insurer besides obviously covering your own vehicle, in the case of a mishap, it pays any damage expenses to the car that you hit or damaged. It also protects you if you drive another vehicle other that your own. For example, if you are hit by another vehicle, the insurance pays the affected third parties. This is a very good benefit because if the car you were driving was not insured and you crashed, you are protected at all times to repay the damage.

2. Car Rental: In the case of an accident if the insurer determines that your car requires a major repair in the workshop, and therefore, you have to leave it to be repaired for an extended amount of time, or in the worst case scenario, it has been stolen, you will not have a working vehicle to use. That’s when this benefit of premium car insurance steps in. The insurance company will provide you with a rental car for you to use during the time it takes to repair your car or reimburse you for the theft of it, with a car that is valued at the same amount as your previous car.

3. Lower Percentage deductibles: This is a direct economic benefit in case of total theft or material damage. In other words, if you had a basic and general insurance coverage, perhaps the deductible to be paid would be 10%, while in a premium it can be reduced by up to 5%; equally in material damages, the general basic one can be a deductible of 5%, while in a premium there can be a reduction of up to 3%. This is a considerable saving as you would pay almost half the price in either circumstance.

4. Greater coverage of expenses and civil liability:  Because of its premium coverage, the insurance will give you a higher amount for medical expenses that can be spent among the passengers during an accident. Also, the insurer, in the event of an impact, increases the amount it will pay for damages to third parties and required parts you may need to fix your car.

There is no doubt that these types of car insurances offer great benefits, although a lot of people wonder if these benefits remain the same after being involved in an accident. And If they do, how much do they actually change regarding fees?

It might come as a surprise to us that most insurance premium changes are managed mostly on a case by case basis, depending on different factors we will list:

  1. If it’s your first accident or not
  2. For how long you’ve been a client of the company
  3. The type of accident you had
  4. If people got injured or not
  5. How much time has passed between each accident
  6. How badly damaged your car ended up

Let’s take a quick look at this comparison chart by 3 popular insurance companies:


  1. % increase after the first accident: 30%
  2. % increase after the second accident: 150%


  1. % increase after the first accident: 29.5%
  2. % increase after the second accident: 56.2%

State Farm:

  1. % increase after the first accident: 10%
  2. % increase after the second accident: 45%

That’s why, besides obvious reasons, it’s very important to drive safely, because an insurance may seem like a great deal at first, but the second you are involved in an accident fees will go over the roof, not just doubling themselves but even more.

Daniela is America News Hour journalist and an expert in Finance, agricultural investments, economics, financial markets, new media, international relations & politics. Daniela has been a writer and editor for the past 11 years. She started out as a freelance content writer. Today, her articles have been picked up by major and local news sources and websites such as the CNET, Engadget, BuzzFeed and many more.

Leave a Reply