Accidents on the road are moments drivers never want to experience, but unfortunately, even the best drivers can find themselves in an accident. Maybe you had a slight fender bender. Or perhaps you accidentally stopped too late and rear-ended another driver. It can happen, and when it does, it can affect your auto insurance rates. Let’s take a look at how car accidents can affect your auto insurance and what you can do if you find yourself in a collision or other incidents on the roads.

Who is at fault?

This is the question that determines who holds the responsibility for the accident. Collisions with other drivers require insurers to use the Fault Determination Rules to determine who was at fault for the accident. These regulations outline different instances and rules that help identify who was responsible after an accident. This process can take time and can involve police investigation. If you are found to be at fault for the accident, you could face increases to your auto insurance premiums. 

How much will my insurance go up?

The amount your auto insurance premiums can increase after an accident can depend on certain factors. The Fault Determination Rules determines the amount of fault placed on drivers. It can typically be 0%, 25%, 50%, 75%, or 100% of your responsibility when an accident occurs. For 25% and above, there may be an increase in your premiums. Anything below that percentage and your rates are very likely not to increase. 

No-fault and accident forgiveness

In Ontario, no-fault insurance is a mandate that ensures insurance companies pay out claims on time. It doesn’t mean that no one is at fault for an accident, even though the name can lead people to believe that. Simply put, with no-fault insurance, you go through your insurer to get claims settled and don’t have to worry about directly dealing with the other driver. 

Accident forgiveness is an insurance add-on (called a rider) that helps protect drivers with good driving records from facing increases to their auto insurance premiums if they are at fault. It is not included in every policy and must be added on as a separate cost to your original auto insurance plan. It can’t protect you from rate increases for every incident on the roads, especially those outlined in the Ontario Highway Traffic Act.

What can I do?

The amount of time an accident can affect your auto insurance rates can differ depending on where you live and the severity of the accident. After some time has passed from when the accident has occurred and your insurance premiums have risen, you may be able to work with your insurer to help keep your rates more manageable.