Will My Car Insurance Policy Be Canceled If I Get Into An Accident
Any time you file a claim, a series of events happen. Depending on your situation, this can affect your car insurance rates, and whether or not a company decides to keep you on as a policyholder. There are many misconceptions about this, however, with many people having fears that their car insurance policy will be canceled, when in reality it won’t be.
Yes, it is entirely possible that your policy can be canceled, but it is very rare for this to actually happen. There is a much higher likelihood that your car insurance provider will choose to do a nonrenewal. There is a difference between cancellation and nonrenewal, which will be talked about here.
When Can Your Car Insurance Be Canceled?
After an accident, there is a chance that your car insurance could be canceled, but only in very specific situations. If you have not had your insurance policy for more than 60 days, or the policy is shorter than that, you could find that your car insurance policy gets terminated. This generally only happens if the accident was very severe and you are determined to be at fault for it. In most cases, a car insurance provider could choose to non-renew your policy instead.
While this may be the case, the most likely scenario is that your car insurance premium will go up and you will still be able to get auto insurance coverage through your current car insurance provider. Depending on the severity of the accident, and whether or not you are already on the higher tier for your car insurance, it is possible that your rates will go up. The most common situation is that your car insurance rates will go up, and you will keep the current provider.
Either way, though, it can be a smart idea to go comparison-shopping when it is time to purchase a new car insurance policy. Different companies weigh different variables uniquely, meaning that you might find a better deal for car insurance elsewhere after a crash occurs when you are at fault. If you are unsure of whether your car insurance will be canceled or not, you can ask the company what usually happens in situations like yours.
When Can Auto Insurance Be Non-Renewed?
There is also a chance that rather than issuing a cancellation or continuing the policy, your policy will simply not be renewed. What this means is that at the end of your current contract, you will need to have another insurance provider in place. Insurance companies are required to give a specific amount of notice, which can vary by state, if they are choosing not to renew your policy. In most cases, a policy will not be renewed when you fall out of the demographic the company offers insurance to.
It is always more beneficial for car insurance companies to insure safer drivers. These drivers will pay money to the company every month, and the company might never have to pay any money back to them to cover expenses. It’s a good deal for them, and you get peace of mind and financial protection just in case. This is also the reason why a person’s driving record has a significant effect on their rates.
There are insurance companies for people who are looking for high-risk driver insurance policies, and they adjust their pricing accordingly. That said, if the insurance company that you are using focuses on low-risk customers, you might find that your policy is not renewed after an accident. If this happens, when you get notice of it, it is time to start looking for another auto insurance policy. Comparing car insurance policy rates from multiple companies starts with getting a free quote for auto insurance. Insurance .us gives access to free quotes for auto insurance to help you on your journey. Keep in mind that you may need to look into a high-risk car insurance provider depending on the severity of your accident and driving history.
Is It Legal For My Insurer To Cancel Or Non-Renew My Policy?
The short answer to this is yes, but each state does have different guidelines and requirements when it comes to cancellation or nonrenewal. In some areas, a cancellation can happen for any valid reason that is not specifically included in the underwriting. In other states, an insurance provider might only be able to remove a specific type of insurance, such as collision insurance coverage, on the vehicle. In this case, they would leave the liability coverage. Most standard auto insurance carriers will not cancel for one accident unless there are other specific circumstances in play.
Also, you should keep in mind that if you are not found at-fault for an accident an insurance company will not typically cancel your policy. If you are involved in three, four, or more no-fault accidents in a short period of time, the car insurance provider could consider that information and make a judgment call on it. Regardless of whether or not your policy is canceled or not renewed, your car insurance company is obligated to cover your claim based on the limits that are stipulated in your policy. Of course, they are not obligated in certain situations like fraud.
If you find yourself needing a new car insurance policy, insurance.us is here for the assist. With the tools here you can get free quotes on auto insurance and find the best deals for car insurance policies in your area.