Rates Spike After Not-at-fault Accidents?

Discussion in 'Auto Insurance Forum' started by Brian Anderson, Feb 16, 2017.

  1. Brian Anderson
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    Brian Anderson Moderator Moderator

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    A new study by the Consumer Federation of America (link below) shows that Progressive raises rates an average of 16.6% (Geico 14.1%) for policyholders after a not-at-fault rear-end collision while State Farm was the only one among 5 insurers included in the study that did not penalize its policyholders for being hit.

    The study also noted that California and Oklahoma have laws prohibiting raising rates for not-at-fault accidents.

    Do you ever get any blowback from upset policyholders who see their rates go up after a not-at-fault event? I wonder what other states (if any) besides CA and OK prohibit it?

    Insurance Forums | Not at fault? Your client
     
  2. lukifer
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    lukifer Well-Known Member

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    I've dealt with this once or twice at SF.

    I think the real question is for the customer is perceived not at fault vs. what the actual findings were. I had 2 customers complain about rates going up when they were first told they were not at fault and when the police report came in, a different story is being told.

    Out of the gate, I will agree with the findings with other customers at SF. I know Country tries not to raise rates based on per centage of fault, but I haven't dealt with it here first hand.

    My sister had Geico and had a not at fault, but her rates didn't change... so I don't know if this is something across the board or they pick and choose.

    Good insights though. Thanks!
     
  3. BlockO
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    BlockO Well-Known Member

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    Two months ago, I conducted a similar study to this one using real quotes I've ran with four of my carriers in six different states....

    I compared clean records vs. having other violations... I didn't just look at not-at-fault accidents. I compared clean records vs. ten of the most common violations.

    Because I only used real quotes spread out over six states, I was limited to a small sample, and only used four carriers (all of which were non-standard, where this study includes both standard and non-standard).

    But the numbers I came up with as far as not-at-fault accidents came up very close to what this study came up with.

    Average overall increase was 8% for not-at-faults. I actually had a carrier that bumped not-at-faults up to 20%. But I also had a carrier that charged zero for not-at-faults. I've attached the overall summary.
     

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  4. lukifer
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    lukifer Well-Known Member

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    Whoa... did I read that right?

    Following too close carries a heavier rate penalty than DUI?

    Crazy...
     
  5. scagnt83
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    scagnt83 Well-Known Member

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    I read an article about this study on Monday. On Tuesday I was in a Not-at-Fault Accident in a car a just bought a month ago. (extremely minor thankfully)

    Question:
    If no police report is filed, but you get a settlement from the At-Fault persons Carrier, would your Insurance Carrier be able to know about it and possibly raise your rates?
     
    Last edited: Feb 16, 2017
  6. VolAgent
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    VolAgent Well-Known Member

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    Don't think greater wrong, thing greater insurance risk.

    If you get a ticket for following too closely, you must be one aggressive driver.
     
  7. Brian Anderson
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    Brian Anderson Moderator Moderator

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    Interesting - are you at liberty to say which carrier bumped not-at-faults up to 20% and which didn't raise rates? Also surprised on your summary that rates only went up an average of 5% after a DUI.
     
  8. BlockO
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    BlockO Well-Known Member

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    yep. sure did! I know it sounds illogical, but most non-standards compete for the DUI market where an accident wasn't involved. That's why they go so easy on DUI's.

    you might also notice how tough they go on reckless op.... which many DUI offenders get their charges lowered down to in order to save their job.

    ----------

    don't want to piss any of my carriers off. so I better not go there. But I don't have anyone special... just the usual non-standard carriers.

    one particular carrier charges zero extra for a DUI with an SR22 included vs. a clean record in most states. they were the lowest at 2% only because the states they don't do that for bumped the numbers up.

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    yes, because if a claim is paid, it will show up on a CLUE report.
     
  9. djs
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    djs Super Moderator Moderator

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    Not that surprising actually. He based this on non-standard carriers who tend not to offer the best 'good driver' discounts. Sample size was very limited and only in select areas.

    Do it again with standard or preferred carriers and you'll see a different pattern emerge.

    In CA, the DUI itself is one thing, but its a mandatory loss of the good driver discount which is a mandatory 35% discount (if I recall that correctly), so a DUI has a impact IF the carrier provides a good driver discount (I think all do). The loss of good driver usually is a bigger impact then the actual DUI.

    Dan
     
  10. scagnt83
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    scagnt83 Well-Known Member

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    Thank you.

    Is that what carfax/car history reports go off of when reporting accidents?
     

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