New Jersey already has some of the nation’s costliest auto insurance rates. And if you’re in an accident or collision, those rates can go even higher. How much higher? It depends on several factors, including your vehicle make and model, whether or not you’re at fault and where you live.
Drivers in New Jersey spent an average of $1,395.53 for car insurance, the sixth-highest in the nation, according to 2023 data from the National Association of Insurance Commissioners (NAIC) — the most recent year for which data was available.
So, if you’re driving in New Jersey, you should know that an at-fault accident could cost you big.
Assuming you were in one at-fault accident, car insurance rates go up by an average of more than 50%, according to a 2022 analysis of full-coverage policies from Insurance.com. That can amount to an extra $920 per year, on average, in premium payments. In New Jersey, specifically, average rates are already high ($2,232), and after an accident claim, they increased by an average of 92% to nearly $4,300, per Insurance.com’s data.
What if the accident wasn’t your fault?
If you were in an accident but you were not at fault, it’s still possible that your insurance rates could go up. But the good news is that they likely won’t go up nearly as much as they would if you were at fault. However, this will vary from insurance carrier to insurance carrier, and there are many variables that will ultimately determine whether your rates change.
But when it comes to not-at-fault accidents, the decision about whether your insurance rates increase (and by how much) will ultimately be determined by the insurer. There are states where penalties for not-at-fault accidents are prohibited, and some insurers are quick to raise rates on drivers even if they aren’t at fault.
For example, some analyses show that several large insurers have been known to raise rates by more than 10% for drivers who were in an accident in which they did nothing wrong.
In short: It’s certainly possible your rates will increase if you’re in a no-fault accident, but it’s difficult to estimate the likely increase. The national average was an increase of $67 to the typical six-month premium, according to data from 2021.
How long does a car accident stay on my insurance?
The answer to this question will again come down to the specific insurer, but generally, an insurer will only consider the last three-to-five years of your driving record when determining your rates. That’s not a hard-and-fast rule, of course, and if your driving record is, well, eventful, then your insurer might take more into consideration. The severity of any accidents is also something they’ll consider.
But for most drivers, insurers likely won’t look back further than five years, assuming you’ve had a relatively clean recent driving record.
Situations an accident might not increase car insurance rates
While it’s likely that your insurance company will raise your insurance rates following an accident — whether you were at fault or not — there are a couple of cases in which your rates won’t change.
The first is if your auto insurance policy carries “accident forgiveness” coverage, or something similar. This is essentially a sort of price-increase protection for drivers in accidents in which they’ve done nothing wrong. It’s offered by some, but not all insurers, and may not be offered to every driver shopping for a policy.
The other situation is if you live in a state that has rules regarding whether insurance companies can raise drivers’ rates following an accident in which they weren’t at fault. States like California and Oklahoma prohibit rate hikes in those situations, for example.
Cheapest car insurance after an accident by state
As noted, drivers in New Jersey are, in all likelihood, not going to see their car insurance get any cheaper after they’re in an accident, or if they file a claim. New Jersey is one of the most expensive states for drivers to purchase an auto insurance policy for a number of reasons, and if you’re hoping to find a cheap policy, your best bet is probably to move to a rural state, like Wyoming.
With that in mind, an accident won’t raise your rates quite as much in some states as it will in others. As mentioned, insurance rates increase by around 50% nationwide following an accident. But rate increases tend to be lowest in rural, less-populated states. That’s in large part because there are fewer drivers, fewer hazards, and less chance that a driver is going to collide with another vehicle.
But if you’re wondering where you can find the cheapest post-accident car insurance, the following states saw the lowest dollar-cost increase:
- Rhode Island – $28 (a 3% increase)
- Wyoming – $101 (35%)
- Iowa – $117 (40%)
- Vermont – $127 (40%)
- South Dakota – $129 (42%)
- Idaho – $148 (40%)
- North Dakota – $161 (42%)
- Maine – $175 (41%)
- Hawaii – $181 (42%)
- New Mexico – $193 (39%)
How to lower your car insurance rate after an accident
There are a multitude of factors that insurers take into account when determining your overall auto insurance rates. Those include, but are not limited to, your driving record, your address, how many drivers are on your policy, your age and your occupation. But it all boils down to how much of a risk your insurer deems you and your driving habits — the riskier of a driver you are, the more you could potentially cost your insurer. And the insurer will price your policy accordingly.
Assuming you are in an accident, many, if not most drivers, can probably expect a rate increase. Those drivers, then, are likely asking this: Is there any way to lower my rates after an accident? The short answer is yes, but there are no guarantees.
Perhaps the first thing drivers can or should do is simply shop around and get quotes from other insurers. Sometimes, the free market can be your friend — but again, there’s no guarantee that you’ll get a quote for a cheaper rate. You can also look at different coverage options your insurer provides, and tinker with your policy (by removing or reducing some coverage) to get a cheaper premium. You can also look at discounts that some insurers offer for things like taking defensive driving courses.
You can also simply request accident forgiveness from your insurer. As discussed, some insurers offer this as a part of certain policies, and if you’ve been with an insurer for a long time with no issues, they may just grant you a pass.
Frequently asked questions (FAQs)
Can you get insurance after an accident?
Yes, you can get an auto insurance policy after you’ve been in an accident. But depending on the severity of the accident, whether it was your fault, your previous driving record, and a host of other factors, you may see your premiums increase significantly.
Can you avoid an insurance increase after an accident?
You may be able to avoid an insurance premium increase following an accident, depending on whether your insurer offers accident forgiveness as a part of your policy, and in some cases, if you were not at-fault in the accident. This will depend on your individual insurer, and where you live, however.
Will my insurance go up if I file a claim?
In all likelihood, your insurance premiums will increase if you file a claim. While it’s not a sure thing, it basically comes down to the fact that filing a claim is going to be costly to an insurer, and as such, the insurer will adjust your policy price accordingly to account for the additional risk.
Do insurance rates go up after a no-fault accident?
In many cases, insurance rates do go up after a no-fault accident. Research shows that many insurers can and will increase rates by more than 10%, even if the driver wasn’t at fault during the accident. There may be local laws that protect drivers from rate hikes, however, or accident forgiveness coverage that might prevent an increase.
