June 2, 2010

How An Accident Impacts Your Auto Insurance Premium

Having car insurance is a necessity when driving a vehicle on the road. When getting an auto insurance quote, it is important to understand what the insurance covers and how much it will affect you if you're involved in an accident. Some people do not realize that even if they are not at fault, their auto insurance premiums may rise. There are several factors that are involved when an insurance company determines the rates or rise in premiums and it is important to know how to be protected.

When you procure car insurance, it covers more than just any damages to your vehicle. It is also designed to pay for any medical expenses due to personal injury or injury to those that are in your vehicle. Some of the coverage provided is uninsured motorist, collision, person injury protection, medical protection and liability. Unfortunately, even if you are not at fault, when your company may be required to pay, this could result in higher auto insurance premiums to pay. If you are at fault, it will cover all of the above including the other vehicle involved in the accident and any persons in the car.

Auto insurance premiums will change based on each state's requirements regarding vehicle accidents. Depending on the state your in, it may set up a point system that is counted when you renew your insurance and depending on the particulars of the accident, your rates may raise. It may also, if you did not carry adequate insurance when the accident occurs, require a SR-22 policy. This can be very expensive and time consuming and could possible affect auto insurance quotes in the future.

It is generally very easy to get car insurance and many companies boast very low fees. However, you must make sure you have adequate coverage and that you are completely protected in case of an accident. Not doing this or having an accident could prevent you from getting insurance in the future, so it is imperative that you have the right kind of insurance. It is inevitable that rates will rise when you have had an accident but if you have a good payment history and an otherwise clean driving record; the company you are with will take all this into consideration and will possibly keep the premium increase at a reasonable rate. Never hesitate to ask question and do not assume that the coverage you have is accurate because you will not want to find out if you had enough coverage when it is too late. One of the most important things to know is that if you were not covered by any insurance at all, it may prevent you from ever getting car insurance.