Once you’ve dealt with the initial shock of an accident on the road, your thoughts may turn to the impact on your car insurance renewal.
From an insurer’s point of view, your claims history is a key factor that’s taken into account when working out what your next premium will be.
But it isn’t the only factor. There are other ways you may be able to lower the cost of your insurance.
Yes, it’s very likely. And it’s a common mistake to assume there’ll be no impact on your insurance if the accident wasn’t your fault. Even if you decide not to make a claim, you could still see a spike in your insurance if the other party involved chooses to make one.
Essentially, insurers see drivers who’ve been involved in an accident as being more likely to be part of one at a later date.
A “no-fault” claim will be less harmful than an “at-fault” one. For example, if your car’s parked in a bay outside a shopping centre and another driver clips you and dents your vehicle, that driver’s clearly at fault. Your insurer will recover the costs of any repairs from the other driver. In this case, your claim gets recorded as no-fault on your insurance history.
On the other hand, an accident that clearly is your fault will be marked as an “at-fault” claim. Unfortunately, you can expect to be hit with an extra charge for your insurance.
A no claim bonus is offered by some insurers to reward safe driving. It offers a discount that applies to many comprehensive policies. This bonus typically increases each year you don’t make a claim.
If you’re able to show to your insurer you weren’t at fault, your no claim bonus won’t usually be impacted. But if you’re proved to be at-fault then making a claim on your policy will generally lead to you losing some, if not all, of your no claim bonus when it comes to renewal time.
Some insurers offer a No Claims Discount Protector as an extra-cost option you can add to your cover. Generally, it lets you make up to 2 claims without impacting your “discount”, but it’ll cost you a fee to add this feature to your policy.
This is one option to think about if you’re looking for more affordable insurance.. But frankly, if you’re accident prone then you might not get much from having this policy feature.
In short, lots of things. Here are some of the main ones:
For example, you could save on your premium if you keep your vehicle parked overnight in a securely locked garage.
Interestingly, consumer awareness of the potential savings to be made appears low. Research has shown that less than half (47%) of drivers are aware that where you park your car will affect car insurance costs.
And while accidents are a core part of your risk profile, from an insurer’s point of view, you might be reassured to know there are several ways you could save money on your insurance.
One way you could save money is to pay for your car insurance up-front annually (if you can afford to do so). This can lead to an insurer offering a direct discount on your policy, instead of if you’d chosen to pay on a monthly basis.
Most insurers also allow you to adjust the level of “excess” payable when you come to make a claim. By choosing a higher excess, you could make a further saving on your premium. But keep in mind that you’ll need to pay more up-front if you make a claim in the future.
With much of the country driving less often due to COVID restrictions, there’s broadly more competition for insurance sales. Fewer miles being driven means there are fewer claims. This can lead to insurers offering lower premiums as they’re in a more profitable position.
This means that now could be a great time to compare various car insurance policies from a range of providers and look for further savings.
By James Martin – Senior insurance writer at Finder
Author: James Martin is a senior insurance writer at Finder, Australia’s most visited comparison site.