Are you still confused about how your auto insurance company keeps coming up with its charges? You might be hearing about an auto insurance surcharge after an accident and wonder what it means. In the briefest explanation, this is only going to affect you negatively.
Do you need more answers? Keep reading to learn more about how an auto insurance surcharge affects you.
What is an Auto Insurance Surcharge?
You may be liable to a surcharge following a chargeable accident, which is an increase in your insurance rate. You’ll find out if they’ll charge you a fee when it’s time to renew your contract. You can’t be charged a fee while your insurance is still active.
Surcharges can occur for a variety of causes other than automobile accidents. Your insurer may also impose surcharges for moving violations.
How Long will the Surcharge Hold?
A vehicle accident fee might last anywhere from three to five years, depending on the state and insurance company. Insurance companies in certain places can only charge you extra for accidents within the past three years.
However, the cost may decrease each year you drive without an accident (or any other surchargeable events).
What else causes an Auto Insurance Surcharge?
This differs from the insurers and state law, but the following are some of the most common considerations for insurers:
- The seriousness of the accident: Rates are affected by the severity of an accident and the cost of a claim. A little fender bender has a lower effect than a severe accident.
- Your driving history: Car insurance companies want responsible drivers. Your insurers may not raise your premiums due to a minor accident if you haven’t had any accidents in years.
- Information on the policy: Accident forgiveness is a provision of specific vehicle insurance policies that guarantees your premiums won’t go up after an accident.
