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How to save on car insurance when you've had an accident
Being in an 'at-fault' accident could add 12% to the cost of your premium
The price of car insurance is at a 20-year high, but if you’re unlucky enough to be in an accident, the cost could be even greater.
New data from Compare the Market shows car insurance premiums rise by an average of 12% after an ‘at-fault’ accident - even if drivers are fortunate enough to avoid any physical damage to themselves or their vehicle.
With around 126,247 road accidents in Britain each year, Which? takes a closer look at the data and offers tips on how to reduce your premium after an accident.
How much could an accident add to your premium?
Compare the Market analysed average premium quotes from the last year, comparing the cost for those with no accident claims against those with one 'at-fault' claim (meaning the driver was responsible for the accident).
The average insurance premium when a driver had not had an accident was £559.41, compared to £626.66 for those with an ‘at-fault’ claim. That’s a difference of £67.25, or 12%.
Where you live can also impact how much more you’ll pay after an accident. The table below shows the top five areas with the biggest premium increases after an 'at-fault' accident:
| Location | Premium cost with no accident | Premium cost after an accident | Increase amount |
|---|---|---|---|
| City of London | £734.08 | £1,765.59 | £1,031.51 |
| Wychavon | £463.33 | £836.20 | £372.87 |
| Lambeth | £918.90 | £1,169.77 | £250.87 |
| Purbeck | £446.51 | £666.05 | £219.54 |
| Derwentside | £507.83 | £722.97 | £215.14 |
Source: Compare the Market
Those living in the City of London see the biggest price hike after an 'at-fault' accident, with the average premium for drivers in the borough skyrocketing by 140.5% from £734.08 to £1,765.59. People living in the London borough of Lambeth also see premiums rise by 27.3% after a mishap on the roads.
But it’s not just drivers in the big smoke that face eye-watering increases. Those living in the mostly rural district of Wychavon in Worcestershire are hit with the second-highest rises at 80.5%, while for Purbeck in Dorset and Derwentside in County Durham it's 49.2% and 42.4% respectively.
If no one was hurt and there wasn't any damage to your vehicle, it can be tempting to keep schtum about an accident - especially if you think it will avoid a premium price hike. But further down the line, an insurer could potentially refuse to honour your policy for failing to report the incident and mean you're unable to make a claim when you most need to.
It's always worth talking to your insurer about what's included in your policy as some now offer an ‘accident forgiveness clause’. This means they’ll allow you to have one accident without it affecting your premium costs.
- Find out more: best and worst car insurance companies
Three tips on cutting car insurance costs after an accident
If you've been in an accident, the best way to mitigate any premium price hike is to show the insurer that you are not as risky as they think. Here are our top tips on how to reduce costs in this way:
1. Keep mileage down
Less mileage equals lower risk to insurers and therefore cheaper cover. So try to limit the miles you clock up over the year if you can.
But be honest about it. Lying could lead to your policy being invalidated.
2. Add a named driver
Adding an older, more experienced driver to your policy can sometimes reduce your annual premium.
But be warned: it's illegal to put someone down as the main driver if this is not the case and can lead to an insurer refusing to pay a claim, cancelling the policy altogether or even taking legal action against you for fraud.
3. Take out black box cover
Black box insurance, also known as telematics, using technology to track your car and calculate how safe a driver you are. Metrics used by providers include braking, steering, speed and mileage.
The insurer uses that data to decide whether to reward you for your driving skills. Benefits can include money off your premium and bonuses such as retail vouchers. The technology can also help you identify ways to improve your driving and even help trace your car if it's stolen.
- Find out more: how to find cheap car insurance
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