What factors do insurance companies look at when raising premiums after accidents?

There are a lot of factors that insurance companies look at when adjusting rates due to an accident. With most insurance companies, if your claim exceeds a fixed dollar limit, this will result in a greater increase in your insurance rates than if it was under the threshold. However, raising premiums isn’t just based on the amount paid out but also what coverage was used. For example, a claim paid under comprehensive or uninsured motorist insurance may not have as much impact as a claim paid under bodily injury or collision coverage.

In most cases, one of the largest impacts you’ll see is when you go from having no accidents on your driving record to having just one. Most insurance companies offer an accident-free discount; if you have one accident, not only will your premium go up but you’ll lose the discount. The discount will usually be applied again after five years without an accident.