Claim-Induced Premium Spikes Not Quite So High

AUSTIN, TEXAS—Drivers filing an auto claim can breathe a (small) sigh of relief. For the fifth year in a row, insuranceQuotes.com examined the average economic impact of filing an auto claim—and while premium increases remain substantial, the data shows they’re packing less of a punch.

The study reveals premium increases of 42% (compared to 44% last year) after filing a single claim of $2,000 or more. The rate spike costs consumers $352 on average. Meanwhile, filing a second claim in one year costs an average increase of 92% (which is a 7% drop from last year).

“Nobody likes filing a claim and then having to watch their rates skyrocket, but, for consumers, this year’s numbers bring slightly better news than in the past,” said Nick DiUlio, insurance analyst at insuranceQuotes.com. “While premiums do tend to increase after filing a claim, the severity of the spike will always depend on a number of factors, including claim type as well as where the driver lives.”

These five states showed the highest average premium increases after filing a claim of $2,000 or more:

1. New Hampshire – 66%
2. California – 63%
3. Rhode Island – 62%
4. Massachusetts – 61%
5. Iowa – 57%

Meanwhile, these five states showed the lowest increases:

1. Kentucky – 19%
2. Tennessee – 20%
3. Michigan – 22%
4. Oklahoma – 23%
5. West Virginia – 28%

Of the three types of claims analyzed—bodily injury, property damage, and comprehensive—bodily injury costs consumers the most, with average premium increases of 48.6% (compared to 49% in 2017).

“As concerning as filing a claim might be for drivers, premium spikes are temporary,” DiUlio said. “Depending on the claim, rates may remain high for three to five years, but will gradually fall to pre-claim levels. Regardless, it’s always a good idea to shop around for a new policy to compare rates after filing.“

The full report—which includes rankings of all 50 states, along with additional tips and insights—is available at https://www.insurancequotes.com/auto/insurance-auto-claims-drive-up-costs-31418