What happens when a car insurance company finds out about a car accident?

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In a nutshell...
  • Choosing not to file a claim is never a guaranteed way for a car insurance company to learn about a car accident
  • The typical car accident involving some body work will adjust your premiums higher
  • While your premiums may be only slightly impacted after a car accident, it’s very possible to lose many of your discounts as you no longer have the good driver profile

Car accidents happen to even the best drivers and one of the first concerns in a minor car accident is how a car accident will affect your car insurance rates.

Do you opt to report the car accident or pay for the repairs out of pocket? Will a car insurance company find out about your car accident even if you don’t file a claim?

There is always a concern about a higher cost of car insurance so its common for these thoughts to cross your mind while looking at a minor bump in your door panel.

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How do car insurance companies find out about a car accident?

Sometimes regardless of whether or not you file a car insurance claim, there are still ways car insurance companies may find out about your accident.

Choosing not to file a claim is never a guaranteed way for a car insurance company to learn about a car accident.

From vehicle background checks to police reports to shared databases there are many ways for a car insurance company to learn about a car accident outside of you filing a claim.

— Vehicle Repair Shops often Report Damage

It’s extremely rare for anyone to call your car insurance company and whistle blow, however, there are many shared databases vehicle repair shops and car insurance companies use.

Depending on where you take your vehicle for repair, the repair shop may end up inputting your vehicle repair and accident information in one of these databases.

— Police Report

Police reports are public documents and some car insurance companies scan public police accident reports regularly to help assess the risk of insuring or renewing your policy.

If a police officer was on the scene he most likely filed a report and there is a public record of the car accident somewhere.

— Shared Databases

If you are switching car insurance companies and decide not to “recall” a car accident on your application for insurance it’s not only grounds for a denial but also kind of silly.

Car insurance companies have many resources to find your prior claims history such as Comprehensive Loss Underwriting Exchange.

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What happens when a car insurance company finds out about a car accident?

This really depends on your auto insurance company, your policy coverage and the details of the car accident.

Anytime you fail to report a car accident you leave yourself open to future liability but reporting a car accident doesn’t always result in an increase in rates.

Some car insurance companies offer single accident forgiveness whereas you will not be penalized for a single accident within a certain period of time and others do not hold car accidents caused by others grounds for increasing claims.

Any kind of serious claim including major personal injury, reckless driving and other extreme forms of cost and negligence will always end up with higher car insurance rates and failure to report any car accident is often a breach of your policy terms.

How much will my car insurance rates rise after a car accident?

People are scared of higher car insurance rates for good reason, however, it takes a lot to experience any kind of affordable increase in car insurance rates.

Most car accidents are minor claims and while good drivers may end up losing a discount or having a higher premium rate the additional cost of car insurance after filing a claim is often much less expensive than you think.

It’s when you are convicted of a DUI, reckless driving or cause serious bodily injury and damages to others that you should be concerned about much higher car insurance rates.

The typical car accident involving some body work will adjust your premiums higher but nothing you need to mortgage your house for.

Will I lose my good driver discount after a car accident?

This is where many drivers often experience the biggest shock when it comes to the cost of car insurance after a car accident.

While your premiums may be only slightly impacted after a car accident, it’s very possible to lose many of your discounts as you no longer have the good driver profile.

Since the good driver discount represents one of the largest car insurance discounts available it is possible to see a 20 percent increase or more until your build back up your good driver profile.

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