Do Motor Vehicle Accidents Affect Insurance Premiums? | C&F KY

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Do Motor Vehicle Accidents or Insurance Claims Affect How High My Car Insurance Rate Will Be?

Written by Cooper & Friedman PLLC on May 9, 2024
Can motor vehicle accidents or filing a car insurance claim raise your insurance premium?


Motor vehicle accidents are plenty scary and difficult to deal with on their own. Physical injury, property damage or loss, and having to go through the process of filing a claim are all financially and mentally taxing. The last thing you want to think about is your car insurance, and whether or not it will increase now that you have a claim on file.

Unfortunately for car owners everywhere, it is likely that your premium will increase with each accident or claim. How much your rate increases will depend on the circumstances and your company. In general, motor vehicle accidents that are your fault will usually result in a big increase. However, accidents that were not your fault will likely result in a smaller increase, if there is an increase at all.

All things considered, there are several factors that can go into your car insurance rates. And, while we might not be an insurance company offering rates, Cooper and Friedman can certainly help you get the settlement you deserve for your not-at-fault car accident. For more information on how Cooper and Friedman can help, check out the factors below that could be affecting your premiums!

Factors that Affect Car Insurance Rates

1. Where You Live

Where you live has a lot of impact on how high your insurance rates will be. Since urban areas are more congested, there is a higher risk of drivers getting into accidents. Additionally, you may rent or own a home that only has street parking. This increases the likelihood for hit-and-run accidents and theft. Some cities and towns simply have a higher motor vehicle crime rate, and that affects how risky you are an an insurant. Unfortunately, this affects your premium whether or not the accidents are your fault.

Additionally, premiums differ between states depending on their claims systems. In a no-fault state such as Kentucky where you must file accident claims through your own insurance agency first, it’s a given that insurance companies will have to pay for damages initially, but they do not have the promise that they will be compensated. This causes rates to be higher in comparison to at-fault states where litigation always decides who pays what.

2. The Type and Amount of Insurance

Most insurance companies will have plans that offer you different levels and amounts of protection. As mentioned above, where you live will also have an affect on this facet of insurance, because different states have different requirements. There are also different add-ons, such as roadside service and uninsured motorist coverage that you can also buy, but that decision is left up to you. If you live in an urban area with a high hit-and-run rate (considered an uninsured motorist) or in a state that does not have mandatory car insurance, it is highly recommended that you invest in add-ons that are pertinent.

Kentucky requires every driver to have Personal Injury Protection, or PIP coverage, in accordance to the 1975 “No Fault Law” in the amount of at least:

  • $25,000 bodily injury liability per person
  • $50,000 bodily injury liability per accident
  • $25,000 property damage liability per accident

PIP coverage gets you a payout for damages faster, but at your own insurance company’s detriment, since this law also restricts the ability to litigate against the discernible at-fault party until certain thresholds are met. Luckily, you can usually still be compensated for losses exceeding PIP coverage, as the thresholds that allow not-at-fault drivers to sue at-fault drivers are rather easy to meet. They state that you can litigate if:

  • Medical expenses are equal to or more than $1,000
  • The victim suffers:
    • A broken bone
    • Permanent disfigurement
    • Permanent injury
    • Death

In that case, Cooper and Friedman can help get you the compensation that you deserve.

3. Your Credit

While insurance companies do not use traditional credit scores to determine car insurance premiums, they can use credit-based insurance scores. Presently, only California, Hawaii, Michigan, and Massachusetts ban companies from factoring these scores into premiums. The credit elements that influence your credit-based insurance score varies from company to company. They might even have their own formula, and you can always inquire about it with an insurance representative. However, common factors might include:

  • Payment history
  • Total debt
  • Length of credit history
  • Pursuit of new credit
  • Mix of credit

Therefore, events such as making late payments, using a high amount of your available credit, applying for a lot of new credit accounts, or having accounts in collection can have a negative impact on your credit-based insurance score and hike up your premiums. If you believe that an insurance company is using unfair credit reporting, or you have items on your credit report that are affecting your traditional credit score, contact Cooper and Friedman today.

Bring Your Louisville, KY Motor Vehicle Accidents to Cooper and Friedman

Insurance companies consider much more than solely those three factors. Others include but are not limited to:

  • Driving Record
  • Gender
  • Age
  • Make, Model, and Year of Your Car
  • Car Usage/Average Mileage
  • Marital Status
  • Car Insurance History

Motor vehicle accidents are scary. Many times, victims lose more than they gain with their PIP coverage. If your accident turns into litigation, Cooper and Friedman are Louisville’s best car crash lawyers in Louisville, KY and the surrounding areas. Call us for a free 15-minute consultation and start your journey to compensation today.

If you or someone you love has been injured in a motor vehicle accident in the State of Kentucky and are in need of an experienced car accident attorney, give the lawyers at the Cooper & Friedman law firm a call. The attorneys at Cooper and Friedman PLLC have over 50 years of combined experience defending the rights of motor vehicle collision victims. Contact us with questions you might have or schedule a free case consultation with an attorney by calling 502-459-7555 today.

Posted Under: Car Accidents, PIP Claims, Unfair Credit Reporting

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