Can I switch auto insurance after an accident where I was at fault?

Drivers can switch auto insurance after an accident, but one accident can raise your rates about $81/mo. If you caused an accident, this doesn’t prevent you from switching to a new auto insurance company. However, switching car insurance after an accident is not always in your best interest. Your old insurance company will still be the company dealing with the at-fault accident, and you may not be able to find more affordable auto insurance rates elsewhere. Learn more here.

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Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insurance...

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Reviewed by Leslie Kasperowicz
Farmers CSR for 4 Years

UPDATED: May 28, 2021

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What You Should Know

  • You can switch auto insurance companies at any time.
  • It is illegal to lie about your accident when switching companies.
  • It is sometimes best to stay with your current insurer, especially if you have accident forgiveness.

Can you switch auto insurance after an accident where you were at fault? Or do you need to stick with your old insurance company?

You’ve been involved in an at-fault accident and you’re wondering whether or not you can switch auto insurance after an accident.

Today, we will answer all your questions about switching auto insurance after an at-fault accident and help you with understanding auto insurance rates after accidents.

Always compare quotes before you buy auto insurance. To find the cheapest insurance rates in your area after an at-fault accident, enter your ZIP in our free tool above.

How to Switch Auto Insurance After an At-Fault Accident

If you’ve been involved in an auto accident in which you were at fault, then this doesn’t prevent you from switching to a new insurance company. You’re free to switch insurance companies at any time.

Your old insurance company will still be the company dealing with the accident, and you’ll still have to cooperate if there’s a lawsuit – say, if the other driver sues your insurance company for damages beyond your policy limits.

If you switch to a new auto insurance company, then your car will be covered under that new insurance policy moving forward. It is vital that you do not cancel your current auto insurance policy until you have a new one in place. Otherwise, you may end up with a lapse in insurance.

Insurance lapses are illegal and will make your auto insurance rates go up even higher.

Typically, you can switch to a new auto insurance company without penalties. The only exception is if you pay your insurance monthly. In that case, you may have to pay outstanding financing charges, although the company may still refund part of your monthly rates.

Overall, canceling your auto insurance coverage at any time without facing major penalties can be done – including after an at-fault accident.

What does insurance cost after an at-fault accident?

Just how much will your insurance rates go up at your insurer? We partnered with Quadrant to show you average price increases for one at-fault accident.

Auto Insurance Rate Increases After One At-Fault Accident
Company Rates with a Clean RecordRates with 1 At-Fault Accident
State Farm$2,821.18$3,396.01
American Family$2,693.61$3,722.75
Liberty Mutual$4,774.30$6,204.78
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Depending on what company you are at, it may be a good idea to shop around for insurance rates and change insurance after an accident. However, you can expect your rates to increase anywhere from a few hundred to a thousand dollars after an at-fault accident.

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Things to Consider Before Switching Auto Insurance After an Accident

You might be tempted to switch your car insurance company after you cause an accident once you see those rates go up.

However, that might not always be the best idea. Read on to discover when you should switch and when you should stay.

Is it a good time to switch to new auto insurance after an at-fault accident?

Should I switch insurance companies after an accident? We’ve established that you can switch to a new auto insurance company after an accident where you were at fault. However, is it a smart idea to switch to a new auto insurance company now? Is now the right time to make a switch?

Typically, you’d want to change insurance companies after an at-fault accident if you’re facing substantially higher insurance rates.

Your insurance company might not offer accident forgiveness, for example, in which case you might be paying 50 percent or 80 percent higher insurance prices after an at-fault incident.

You might find a new insurance company offering cheaper rates even with your at-fault collision. In this situation, it likely makes the most financial sense to switch to a new insurance company – assuming you can switch without penalties.

When should I not switch auto insurance companies?

There’s never a bad time to shop around for auto insurance policies. In fact, the days and weeks following an at-fault accident are some of the best times to shop for new auto insurance. You can see what other options are out there, then choose a quote from a superior auto insurance company.

However, don’t expect to save a lot of money when switching car insurance after an accident you caused. Typically, you’ll pay higher auto insurance rates from every insurance company after a single at-fault collision.

If you have accident forgiveness at your current insurer, then the best option is to stay with them. You will be forgiven your first at-fault accident, meaning your rates won’t go up.

If you cancel mid-policy, you may also be charged a cancellation fee. Generally, waiting until the end of the policy period will ensure there is no cancellation fee. Make sure to also ask about refunds for the unused policy period if you prepaid, so you can get as much back as possible.

Generally speaking, you’re not going to save a lot of money by switching insurance companies after an at-fault collision. That means it’s not necessarily a good idea to switch insurance companies.

Would you lose discounts and benefits if you switch auto insurance?

When you start over with a new car insurance company, you might lose some of the discounts and perks you’ve grown used to with your current insurer.

For example, companies that offer accident forgiveness perks often require you to be a customer for a certain number of years to get that benefit. You would also lose any loyalty discounts that your current company gives you.

How to Avoid Insurance Fraud When Switching Auto Insurance

Sometimes, drivers try to get sneaky with their new auto insurance policy. If you’ve recently been involved in an at-fault collision, then you might try to immediately switch to a new auto insurance company before the accident appears on your vehicle’s permanent record (with your state’s DMV).

If you’re looking to switch insurance after an accident before it appears on your record, then you’re deliberately misleading your new insurance company.

You’re most likely committing insurance fraud. Even if you’re able to receive a policy from your new insurance company, that policy may be void if you need to make a claim.

The Insurance Information Institute says that fraud, including minor fraud like lying about driving records on applications, costs the insurance industry $40 billion a year.

Because fraud costs insurers billions of dollars, even small cases of fraud are taken seriously. In other words, if you’re trying to switch insurance policies because you think the new insurer doesn’t know about your accident, then this is a bad idea.

Ultimately, most auto insurance companies in the United States allow you to cancel your policy at any time. You can cancel your policy after an at-fault collision without facing major penalties.

Most insurance companies will refund part of your rates, minus any financing costs. Your old insurance company will deal with the accident, and your new insurance company will continue to protect your car going forward.

Generally speaking, however, it’s not in your best interest to switch insurance companies after an at-fault collision. You’re going to pay higher rates for auto insurance at every company after a single at-fault collision.

Ways to Reduce Your Auto Insurance Costs After an Accident

Once you’ve had an accident, your auto insurance will probably go up. What can you do to help keep those costs low?

Here are a few options for you to cost those car insurance costs:

  • Talk to your insurance company right away – your car insurance company has to be notified of the accident quickly. You can also ask if they offer accident forgiveness.
  • Increase your deductible – Raising your out of pocket costs will help lower your auto insurance rates.
  • Ask for discounts – There may be discounts that you aren’t taking advantage of, like multi-car or low mileage
  • Take a defensive driving course – Many car insurance companies will give you a discount if you take a defensive driving course. Also, some states will let you use those classes to remove points from your driver’s license.
  • Shop around – Compare quotes from other auto insurance companies to make sure you are getting the best deal you can.

Unless you can find a really good deal – say, with a company that offers accident forgiveness – it’s unlikely that you’ll save enormous amounts of money by switching to a new auto insurance company after an at-fault collision (although you should still consider comparing quotes).

If you want to save on auto insurance after an at-fault accident you caused, enter your ZIP in our free tool above to compare auto insurance quotes now.

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