Here's Why Your Car Insurance Goes Up After a Claim, Even If You're Not at Fault

A few years ago, I was involved in a hit-and-run car accident that destroyed the back bumper and trunk of my Kia Rio. Fortunately, I had uninsured motorist coverage and received a settlement check large enough to replace the car. At the time, I thought my car insurance costs would stay the same, as the accident wasn't my fault and didn't reflect my driving. But I was wrong -- very wrong. 

When I got my new car, I asked my insurance agent to find the best coverage. They gave me a great rate, lower than what I was paying before. But during the application process, they asked if I had gotten into an accident recently. When I told them about the hit-and-run accident, they returned with a new rate -- slightly higher than the first one. 

That frustrated me. After all, how could an insurance company charge me more after an accident I didn't cause? Doesn't that seem a bit unfair? Turns out, I'm not the only one who has found themselves in this situation, nor did I realize at the time how this one no-fault accident would stay with me.  

Car insurance companies don't like to lose money 

Let me say this -- not every driver will see an increase in their car insurance premiums after a no-fault accident, and even if they do, the change likely won't be significant. In fact, according to the Zebra's 2022 State of Car Insurance report, a no-fault accident causes on average a 2.6% increase in your annual premium, or about $40. That's significantly less than an at-fault accident, which could increase your premium by 36.7% or $561.  

One big reason a no-fault accident causes insurance to go up is if the driver is filing under uninsured motorist coverage. Even if your driving was immaculate before the accident, your insurance company is still responsible for paying the claim. To compensate for this unexpected cost, it may shovel some of the burden onto you.

The situation might change if you file a claim with the at-fault driver's insurance company. In this case, your insurance company isn't paying the claim and it may not change your premium after the accident. That said, a no-fault accident could stay on your driving record for three years or more. And, as in my case, this could still affect your premium costs, even if you get insurance from a different company.

How to cope with higher insurance costs after a no-fault accident 

If you notice a change in your car insurance after a no-fault accident, I would suggest shopping around for different rates. Since insurance companies have slightly different ways of determining premiums, drivers might find a better price with another company, especially companies known for offering low rates to drivers with recent accidents. 

It's pretty easy to compare rates on your own -- just request quotes from the best car insurance companies -- but if you don't have time, you could also hire an independent insurance agent, someone who doesn't work for insurance companies but can still help you find great rates for your situation.