Car accidents can affect insurance premiums for years

(InvestigateTV) – A recent study by Bankrate found that the cost of comprehensive insurance has increased by 26% in the last year. In particular, the number of people who cause one or more car accidents has skyrocketed.

Bankrate analyst Shannon Martin said this one accident could raise interest rates for about three to five years.

“If you're involved in an accident, your premium goes up by about 43%, so with comprehensive insurance, it's about $3,299 a year,” Martin said.

Martin also said that another driver doesn't have to be involved. If a driver slips on ice or swerves to avoid an animal and hits a tree instead, they can still be considered at fault for the accident by their insurance company.

Inflation also continues to impact the cost of labor and parts for vehicle repairs, driving up costs. Martin said the cost of those repairs is still about 20% higher than before the pandemic.

“I always recommend that people take a look at their policy and make sure it's correct,” she advised. If you've had any changes, such as changing jobs, graduating college or moving house, these kinds of things can affect your policy's premium, so you could get a lower premium just by making sure everything is correct. In that case, it's always good advice to shop around. Most providers have made increases, so you may not save as much now as you would have a few years ago.”

Martin said not every insurer is right for every driver, so consumers should make sure their insurance company fits their needs and budget.

The best strategy is to be prepared, she said. So create an emergency fund in case something goes wrong. That's the definition of an unexpected emergency expense.

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