3 On Your Side: Insurance Rates Rise After Filing A Claim
By Jim Donovan
PHILADELPHIA (CBS) -- To file or not to file. When submitting a claim with your auto insurance company, don't be surprised if your rates go up. Some premiums may even double! 3 On Your Side Consumer Reporter Jim Donovan takes a look at how much and why.
Drivers who make a single auto insurance claim of $2,000 or more can expect their premiums to increase an average of 41 percent. That's according to a study by InsuranceQuotes.com.
New Jersey drivers get hit with some of the biggest rate hikes after filing a claim, with premiums rising on average 62%, the third highest nationwide. Delaware premiums rise on average 37%, and Pennsylvania rates jump 32% after filing a claim.
"Insurers are raising rates because they deem you to be a riskier customer. They know if you file a claim once you're more likely to file again," says Laura Adams, senior analyst with InsuranceQuotes.com.
In addition to location, premium increases are also affected by the type of claim.
Bodily injury and property damage, including collisions, result in the biggest boost in premiums. While comprehensive claims for non-collision events such as theft, result in the lowest rate hikes, an average of only 2 percent.
The moral of the story? Weigh the pros and cons before filing a claim, especially if it's for something minor. Adams says, "You may want to consider not filing. If they're smaller, it may be wiser to pay for those out-of-pocket rather than see your rate increase for years into the future.
These premium increases typically only kick-in for accidents where you're at fault.
If someone hits you, their insurance will cover the claim and typically, your rates won't be affected. But don't worry, the higher rates don't stick around forever. Depending on the claim, you can expect them to remain high for 3-5 years.
For more information, visit: www.insurancequotes.com/auto/one-auto-insurance-claim-rate-increase
