Car crashes can happen to anybody. In a crash report issued by the Arkansas State Police, they listed that there are over 60,000 car accidents a year in the state of Arkansas. Many of those accidents cause damages and injuries. Thankfully, car insurance is there to cover most damages. But what exactly happens to your insurance premium after a serious car crash?
Insurance Premiums and How They Work
Auto insurance lingo can be confusing, but it can be broken down to be more easily understood. In the simplest terms, an insurance premium is the amount you’re charged by the insurance company for your insurance policy. Any fees charged beyond your policy, like a service fee, is not considered the premium. Some companies make you pay the premium upfront before you have coverage, but others allow you to pay annually, semi-annually, or even monthly financing.
The cost of your premium depends on how much you’re insuring as well as your amount of risk as a driver. Depending on how much you’re insuring, your monthly payments will go up to meet that price. And if you are a new driver or have been involved in accidents, your premium could go up because you are considered a greater risk to the insurance company.
Arkansas Car Insurance Laws
By law, all drivers in Arkansas must have car insurance. As listed by the Arkansas Insurance Department, drivers must have the minimum liability coverage of $25,000 per person for bodily injury, $50,000 per accident, and $25,000 for property damage. Drivers also must be offered uninsured and underinsured motorist (UM/UIM) coverage as well as personal injury protection (PIP) coverage.
The bad news about insurance premiums is that they can go up after a car crash. After just one accident claim where you’re at fault, your premium could raise around 41%, according to an article by CBS News. The rise depends on who was at fault, driving history, and seriousness of the accident. Two claims could make your rate go up 93%.
After an accident where you’re at fault, you are personally financially responsible for any other costs for damages that exceed your policy coverage. So not only might your premiums go up, but you might have to pay even more out of pocket. In order to protect your pocket, you can get higher insurance limits.
Seeking Legal Aid After an Accident
Arkansas follows the traditional fault system after a collision occurs. So whoever is at fault is responsible for any losses of the other party, including injuries, lost wages, and other damages. If you are not at fault, your insurance premiums shouldn’t change because the other person is responsible for the costs.
You shouldn’t need to use your insurance for damages when another driver is at fault. After a car accident you are not responsible for, you can file a claim with your own insurance company, file a third-party claim with the at-fault driver’s insurance company, or you could file a personal injury lawsuit in civil court.
If you’ve been in a car accident where you weren’t at fault, you might have a hard time returning to normal life. You could have injuries that prevent you from returning to work or keep you from doing everyday things. A car accident lawyer from McMath Woods P.A. could help you get back on track. We can handle the legal side of things while you focus on healing. Contact us today for a free consultation.