How much our car insurance premiums might go up if we have an accident is not something we think about. However, it becomes a major concern if we are involved in a collision, especially if it is our fault.
According to IBAOHIEM, a Vietnam-based firm that deals with car insurance (bao hiem o to bao viet), in the majority of cases, an accident will push up your premium rates. How much will depend on what happened and the insurance company’s definition of an accident.
What affects you car insurance? Dos and don’ts
Is this your first accident?
Some automobile insurers offer ‘accident forgiveness.’ This means that in some cases, they won’t raise your premiums for an at-fault accident. An ‘at-fault accident’ is one in which the insurance policyholder caused the collision because of something they did or an action they failed to take. Put simply, it means that the accident was the policyholder’s fault.
Insurance companies won’t forgive every at-fault accident. It must be your first at-fault accident. Your driving record should otherwise be impeccable.
Every insurer has its own procedure and policy for accident forgiveness. If you were involved in an accident, you need to contact them to find out.
It is important to remember that even if your insurance covers you for your at-fault accident, this does not mean that it won’t appear on your driving record.
Insurance companies are unlikely to approve drivers with a history of auto accidents or too many speeding tickets. Multiple accidents won’t disqualify you forever. After about three years, insurance companies start seeing you as a ‘lower risk’ again.
Refresher driving course
In many countries, a refresher or defensive driving course may reduce your auto insurance premiums. In the United States, for example, a defensive driving course can reduce annual premiums by over $60.
Advanced driving instructors say that people who have been driving for several decades have been doing so without retraining. We may have acquired bad habits during that time without realizing it. We may also have forgotten important safety precautions that we were taught when we were learning to drive for the first time.
As far as vehicle driving is concerned, nobody is too skilled, experienced, or old to develop better habits or abilities.
Although attending an advanced or defensive driving course won’t help you if you take it after your accident, it is something you should consider. Apart from keeping you safer on the road, you will be seen by insurance companies as a safer bet (lower risk).
Inform your insurance provider of all accidents
None of us expect to be involved in a collision with another vehicle or to hit something. However, it can occur in the blink of a eye, regardless of whose fault it is.
Even a minor incident can get our adrenaline going, which can make everything a bit of a blur. Most of us say we know exactly what to do after an accident, that is, until it happens to us.
After making sure that you, your passengers, and the people in the other car are safe, call the police. Then make sure you note down the make, color, model, and number plates of all the vehicles involved in the collision. If you have your smartphone with you, take photos. Also note down the exact time and date of the incident.
Take note of what driving conditions were like, such as the state of the road surface, street lighting, fog, etc.
Take pictures of the position of each vehicle that was involved in the accident. If somebody’s property was damaged, such as a front gate, and the owner is not around, leave a note with your contact details.
Phone your insurance company as soon as you can, but only after you have made sure that everybody is safe and that there is no risk of another crash from passing vehicles.
The insurance company will need to know:
- Your insurance policy number. If you don’t have that at hand, they will ask you questions so that they can identify you, such as your car registration number.
- The registration numbers of all the cars involved in the collision.
- The names of the other drivers and their insurance companies.
Even if you have never been in a car accident and doubt you ever will be, it is a good idea to be ready, just in case.
Keep a safety kit in the trunk (UK: boot) of the car. You should also have a first aid kit.
Store your important documents somewhere that is easy to access. These documents should include your ID, contact information, vehicle registration, health plan, and insurance policies.
Do not keep loose items on your seats. Store them either in the glove box or the center console. In a collision, these items can turn into dangerous projectiles (flying missiles).
Even the world’s best driver has no idea whether he or she might be involved in an accident today, tomorrow, or next week. Be ready.
Some points to remember
Remember that what type of cover you get from your insurance company depends on the type of policy you have. Shop around before purchasing one. Only select a policy that covers all your needs and is available at a fair price.
Most financial advisers say that you should pay for your car insurance annually rather than every month. Although paying monthly is convenient, it works out more expensive compared to one upfront sum. If you don’t have the money to pay for a whole year, ask your bank how much a loan costs, and compare prices.
If you make your car safe, i.e., improve its security, your premiums might be reduced; in some cases, significantly. Alarms, immobilizers, and wheel-locking nuts are examples of how you can make your vehicle more secure. Before you purchase those items, ask your insurance company whether your premiums would go down.
Beware of some packaged insurance products. They may be full of features that you do not really need but cost a lot of money.