Auto Insurance Cheap Until You Use It, According To New Study
Drivers who file an insurance claim after an at-fault car accident are likely to see their insurance rates increase up to 73 percent, depending on where they live, according to a new study by Quadrant. The study, commissioned by insurancequotes.com, based its research on a hypothetical ideal customer (good credit, continuous coverage, no previous claims) making claims of various types and amounts. The harsh financial realities of actually using insurance are likely to surprise many consumers.
According to study sources, the reason for the increase in rates is simply due to the actual cost of making repairs or treating injuries. Statistics show that a driver who has filed a claim is likely to file more claims in the future, and the insurance industry is driven by statistics.
Looking only at property damage (the driver’s vehicle, other vehicles, and other types of property), filing a claim of $2000 or more resulted in the largest premium increase in Massachusetts at 73 percent, followed by New Jersey (71%), California (63), Minnesota (50%), and Arizona (49%). The smallest rate increases were in Maryland (20%), Alabama (22%), Michigan (23%), Wyoming (23%), and Oklahoma (25%).
The study also looked on bodily injury claims, which resulted in the highest average increases, and comprehensive claims (where damage is caused by something other than a collision), which netted a national average of only 1.74 percent for a claim of $2000 or more.
Photo: Phillip Pessar