Accidents are classified based on a few factors:

• Was the accident at-fault? - If a policyholder is not considered to be at fault, most likely the rates will not be increased. On the other hand, being at fault in an accident will impact rates depending on the company’s underwriting guidelines. It may cause a policyholder to lose their good driver discount which may cause an increase in premiums in the area of 20%. If there was only one vehicle involved, usually the accident will be considered to be chargeable unless it was caused by some kind of debris on the road or by a collision with nature’s objects such as a falling tree, an animal etc. To determine fault, a police report will usually indicate the at-fault party. Without a police report, insurance companies may investigate through witness reports and driver statements. Usually, if both drivers are found liable or 50% at fault, both drivers would be considered at-fault.
• Were there any injuries involved? – Whether or not there were injuries involved will also have different impacts on rates. If one was at fault but there were no injuries, it would have less of an impact than if there were. A “letter of experience” from a carrier will indicate whether there were any bodily injury payouts. Sometimes the police report may be acceptable proof of no-injury; however, not all companies will accept it since persons may not feel injured until a couple days later.
• Was the accident as a result of a collision with an emergency vehicle, such as an ambulance or police car? If there was a collision with an emergency vehicle, sometimes it will be considered non-fault because those type of vehicles sometimes disobey traffic regulations in order to rush to an emergency situation. In that case it shouldn’t have an impact on rates.
• Were any drivers under the influence? If a driver involved in an accident was under the influence of drugs or alcohol, it will be considered a “major violation” and may cause a bigger impact on premiums since it will be in conjunction with a DUI (driving under the influence) or DWI (driving while intoxicated). In Michigan, these charges can stay with you for 5 years.
• Was the amount of damage under $750 in damage? An accident may be dismissed or non-chargeable if the property damages were under a certain amount, usually $750 in damage; however, the amount may vary within carriers. Usually when there is insignificant damage to the vehicles (fender benders), no injuries are involved and rates are not impacted.
• How long ago was the accident? If an accident occurred more than three years ago, usually it will be not be considered chargeable since guidelines usually dismiss them after a certain time. Check with the insurer to see how long until they dismiss them.
• Was there a citation issued? Usually the driver who receives a citation when involved in a accident will be considered to be at fault for breaking traffic laws. This, however, does not apply for violations such as “unregistered vehicle” or other non-moving violations.
• How many accidents within the past 3 years? The number of accidents one is involved in also determines impact. Multiple accidents within a certain period may cause non-renewal and significant rate increases.

The best way to find affordable rates, even with tickets or accidents, is to stop by the Steve Bedgood Agency in Muskegon will insure for less.

Insurers have a way to figure out how much they would possibly spend on insuring you by calculating a level of risk and assigning it to each driver. Drivers with a high level of risk, or a high chance of filing a claim, are charged more for a policy than a driver who is assigned a low level of risk.

How is a level of risk determined? What would be the  impact of an accident on your rates and quotes?

All of the answers that are given in our interview  or to your agent are taken together and that is what forms the level of risk.

1. A high level of risk is assigned to someone who has a driving record with tickets and accidents. The more of either of those activities, the higher the risk level.

2. Drivers who put a certain high number of miles on their vehicle every year or who live in a high crime area are charged more for their insurance.

3. Expensive vehicles cost more to insure.

4. A driver with few years of driving experience will pay a little more than someone 25 or so.

How do these things (plus others) prove a driver is going to file a claim? Auto insurance companies have statistics that show the background information, such as that listed above, of drivers who file claims most often. With these indicators the insurer can fairly accurately predict who they will need to pay out a claim for and then charges them more to even out the balance.

At the Steve Bedgood Agency in Muskegon, Michigan we can find your level of risk and we can get a policy to fit your needs.

Please give me a call at (231) 744-9099 or start with a visit to my web site at www.muskegoninsuranceagent.com.

How Likely Is a Rate Increase?

The chance of an increase in premium rises along with several factors:

• Accident severity.
• Your degree of fault, unless you’re in a “no-fault” state.
• The value of the insurance claim you or the other driver files.
• Type of violation, if you get a ticket at all.
• Whether the violation or accident appears on your MVR or CLUE report.

How Much Money?

Like everything else about insurance prices, the amount of an increase, if any, varies by company. However, based on a 2008 Insurance.com study of the effect a violation or insurance claim has on premiums, the price can be high. Drivers who had an additional ticket saw their rates increase from $157 to $248 a year while those who had an additional claim saw increases ranging from $302 to $458 annually.

When Will It Go Up?

These increases are typically seen at renewal time, but if you didn’t notify your insurance company (please do!) and no one made a claim, it could take awhile for the company to find out. Rest assured that they will not be happy to uncover a ticket or accident you failed to report. If you’re switching companies, they may not find out until they order your driving or claims history, at which time they may decide not to issue you a policy.

Accident Forgiveness

Some insurance companies, including us at Farm Bureau,  offer an accident forgiveness feature for our clients. If yours does—and you qualify—your rates may not increase if you’re found to be at fault in a relatively minor accident. However, there could be severe consequences if you’re involved in a major accident and you’re driving under the influence. Remember that there are worse things that can happen than a higher insurance premium, like license suspension and jail time.

MVR = Motor Vehicle Report. Not every traffic ticket actually appears on your MVR. In fact, in some states only 75% of all moving violations are ever recorded on an MVR.

CLUE = Comprehensive Loss Underwriting Exchange. C.L.U.E. is a claims history database created by ChoicePoint that allows insurance companies to access your claims information when they underwrite or rate a policy. The report includes claim information such as date of loss, type of loss and amounts paid, and vehicle description.

Car Insurance can vary widely from company to company. Come see me at the Steve Bedgood Agency and we’ll do our best to get you get you the best policy we can based on your situation.

Contact me at www.muskegonautoinsurance.net or call me at (231) 744-9099