An auto accident already brings financial consequences. In fact, just covering damage and potential injury costs can be exorbitant. The accident may also bring insurance costs, depending on the size of your deductible, but an additional worry may be how the accident will affect your auto insurance rates.

The effect an accident will have on your rate will depend on the exact policies of your auto insurance company. However, most companies follow similar practices in determining whether an accident affects your driving record, both for when you are and are not at fault.

Accident Factors and Your Rates

The severity of the accident will be one of the first things your insurance company considers when determining a rate change. Most people know rates will likely increase much more for a totaled vehicle than a scratch in the paint, but they may not know that, even if you aren’t at fault, an accident can affect your insurance rates.

Your previous driving record will also play a part, as it is less expensive for insurance companies to cover safer drivers. The longer you’ve been with the company and the more time it’s been since you’ve had an accident (or if you’ve never had an accident at all), the lower price hike you can expect following an accident.

Accident forgiveness policies also allow for one accident without any rate changes, regardless of which driver was at fault.

At Fault vs. Not At Fault

The fault in the auto accident plays one of the biggest roles. If the accident was your fault, you can expect an increase in your insurance rate. Unlike other no-fault states, Montana does not require both parties to split the coverage of an accident. This means that if the other party was at fault, then most likely your insurance company will not increase your rate after a claim.

However, not all companies work on the same policies. Being in an accident once statistically increases your chances of being in another, even if you weren’t the at-fault party. Some companies will change your auto insurance rate after an accident, even if the other person hit you.

To fully understand how an accident will affect your rates, it is best to review your policy or discuss it with your insurance company.

Your Driving Record

Your Montana driving record keeps track of your previous accidents and traffic violations for three years from the incident date. While having 30 points results in a license suspension, any number of points can affect your insurance rates. Acts that incur points on your record include:

  • Speeding
  • Not stopping at a scene of an accident involving property damage
  • Reckless driving
  • Illegal drag racing
  • Not stopping at a scene of an accident involving injury or death
  • Felonies punishable by the Department of Justice
  • Deliberate homicide using a motor vehicle

The exact effect of points on your license varies based on your insurance company’s policies. Often, to qualify for safe driving discounts, you must provide a copy of a clean driving record.

Importance of Filing a Claim

The potential of an increased rate after an auto accident may discourage people from filing any sort of insurance claim at all. However, filing a claim on its own is not grounds to increase your insurance rate, especially if you were not at fault in the accident.

Even if your insurance rate increases due to a claim, the increase may not be permanent. If you go without another accident, it’s likely that your insurance company will steadily drop your rate over time. A return to pre-accident levels is possible.

Not filing a claim takes away the opportunity for you to have a record of your side of the story, allow your insurance company to investigate the incident, and use your coverage to pay for any damages or injuries sustained by you or the other party. Not receiving coverage could have much greater costs in court than an increased monthly payment.

Have Insurance Questions?

If you’ve recently been involved in a car accident while driving in Montana and have questions regarding your insurance policy that your car insurance company is not answering, contact the car accident attorneys at Ragain & Cook, P.C. today for a free case evaluation. We can help you understand Montana’s car insurance laws and guide you to the best legal actions available.