How to Get Auto Insurance with a Previous Claim


UPDATED: APR 2020 | 3 MIN READ

Prior claims will undoubtedly affect the cost of your auto insurance premium, but it doesn’t have to be the end of the world.  To think that you are going to completely avoid a hike in monthly premium cost after filing a claim is unrealistic but there is a correct way to approach the situation that can benefit you and ease the pain on your bank account.  When you are recovering from an auto claim the first thing you should be considering is how you can minimize an inevitable increase and prove to your insurance company that you are a trustworthy driver.  Whether that means sitting down and meeting with your insurance agent, proving you’re innocent in an accident or reducing your level of coverage, the worst thing you can do after a claim is sit around while your rates skyrocket!  

Below you’ll find tips and tricks of the trade that you can employ in your personal situation.

What should I consider when searching for auto insurance with a previous claim?

  • Let’s talk claim history
  • Does your car have existing damage?
  • Details of the claim, including who is at fault
  • Liability vs. Full Coverage Insurance
  • Should you switch insurance companies?

Should You Reveal Your Claims History?

The short answer is yes. It’s important to be upfront about previous claims because any experienced insurance officer will discover the truth in the end.  When your vehicle is involved in an accident or is dealt with damage which is being partially paid for by an insurance company there will be a temporary mark on your automobile permanent record.  There are some insurance companies who pride themselves on catering to “no claim” members who are extremely low risk.  If your current insurance plan is provided by one of these elite “no claim” carriers clearly your premium will go up and it would be smart to switch or begin to shop around.

Was this your first claim in the last five years?  If so, you may be in the clear after all!  While you may not be receiving an accident-free bonus every year, your monthly premium shouldn’t double.  Most insurance companies are scanning the last three to five years of your auto history due to the fact that older claims will often drop off of your record.  Don’t fear, there is relief in sight!

Does your car have existing damage?

If you were in an accident and are planning to keep the insurance claim payout money without performing any necessary or recommended repairs, you shouldn’t expect a new car insurance company to take on that liability.  If your car has existing damage, finding a new insurance policy that will back-cover damage caused by a recent burglary or collision is nearly impossible.  In fact, many well-known insurance companies will not even offer physical insurance on a car that carries extensive existing damage.  While you may not be able to purchase what is considered to be full coverage insurance, liability insurance which is a requirement in order to drive is always on the table.  We’ll discuss the difference between full coverage insurance and liability insurance later in this article so stay tuned!

Is Your Claim An “At Fault” Violation?

Most car accidents that end in with an insurance claim being filed have a defined party at fault.  A party at fault could end up being the driver who rear-ended another car, a negligent owner, or even a vandal who ends up facing criminal charges.  If at the end of the insurance company’s investigation you are determined to be the party at fault you should expect your premium to increase more than if your vehicle was just an innocent bystander.  If by some chance you were determined to be the party at fault but believe that you are not, writing a letter or making a call to your agent should be at the top of your priority list!  Claims that are caused by a reckless driver or even a third-party who ended up with a DUI are likely to be expunged from your auto record but may require a handwritten letter or email documenting the incident.  Like claim’s caused by third parties if the previous damage to your vehicle was the result of a medical event such as a seizure or lapse in consciousness you may be able to have the strike erased completely assuming you sought the appropriate medical treatment.  

What Kind Of Insurance Coverage Is Best If You Have Prior Auto Claims?

The decision to purchase strictly liability insurance or full coverage auto insurance can often be a financially influenced decision.  As mentioned above, the minimum auto-insurance required to own and operate a vehicle in the United States is liability insurance.  Owning liability insurance means that any damage caused by you while you are driving your insured vehicle will be covered, up to a claim maximum after your deductible is surpassed.  As an example, let’s consider a driver who crashes into a fence and causes $10,000 worth of damage to the owner of the fence’s property.  If that driver’s deductible is $1,000, the insurance company would then cover the remaining $9,000 worth of damage.  If the driver in question possessed full covered auto insurance, the damage to their vehicle as well as the damage to the third-party property would be covered in full other minus the deductible.

So why are we comparing liability insurance and full coverage insurance?  The fact is if you have an existing claim or two on your driving record liability insurance is going to remarkably cheaper, possibly even half the price.  Depending on the vintage and value of the vehicle that you are currently driving it may be worth considering downgrading to liability insurance if the monthly recurring premium costs are too expensive to justify!  

Is switching insurance companies the best option?

If you notice that your insurance premium has been increased due to a recent claim it may be smart to shop around for alternative options.  If this is your first claim the increase may not be very noticeable but studies have shown changing insurance companies every few years only benefits the insured by creating healthy competition among insurance providers.  

If you have become attached to your current insurance company or insurance agent, it may not feel great to shop around behind their back!  Cruising the market doesn’t always have to be for the purpose of changing companies.  If you have a great relationship with your current agent, it may be worth scheduling a phone call to discuss some new offers that you have received to make sure the price you are receiving is competitive!  In many cases insurance agents only hear from a small percentage of their clients, be one of the few who is heard from once or twice a year.  Once your agent starts to put a face or voice to your name you will quickly become one of their more valued clients.

How To Save On An Auto Insurance Policy With Previous Claims

In conclusion, finding auto insurance with an existing claim can make the process more difficult and at times more expensive.  But don’t immediately agree to the first exorbitant monthly premium price that you are offered, there may be better options out there!  Find an agent who is willing to hear your story and review your previous driving record without the negative connotation a recent claim can carry.  

You can also try these techniques to save:

  • Get Liability Coverage Only: Skip comprehensive coverage and stick to a liability policy to reduce your risk to insurance companies.
  • Compare Quotes After A Claim: Some companies don’t want drivers with any claims at all, while other companies are willing to give you a break. Your best bet is to compare quotes to see who can offer you the best rate.
  • Get a Shorter Policy: As time passes, old claims will fall off your record. If you’re stuck with a high insurance premium, try going for a 6-month policy instead of a 1-year policy. That way, you can compare quotes again to try for a lower rate.

At the end of the day you want to feel safe and properly insured when driving around and a previous claim shouldn’t get in your way. 

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