Auto Insurance Claims: How Many People File Them?

There is a lot to consider when it comes to filing an auto insurance claim. While there is no set limit to the number of claims you can make in a year, frequent claims can negatively impact your insurance policy. In the US, the average cost of auto insurance is $2,019 per year, and the average motorist pays $3,290 in property damage liability claims. Motorists file insurance claims roughly once every 17.9 years, and the average collision claim is $5,992. With so many variables at play, it's important to understand the potential costs and impact on your insurance policy before filing a claim.

The frequency of auto insurance claims

The frequency with which auto insurance claims are filed depends on a variety of factors, including the type of insurance, the number of insured drivers, and the number of accidents or incidents that occur. According to Fox Business, the average frequency of filing auto insurance claims is once every 17.9 years. This means that by the age of 34, a person who started driving at 16 is likely to have filed at least one car insurance claim. By the time they reach 70, they will have filed an average of three claims throughout their life.

In the United States, there were 4.2 auto collision insurance claims filed per 100 drivers in 2021, a decrease from 2016 to 2019, likely due to reduced travel during the COVID-19 pandemic. The frequency of claims also varies by state, with Florida having the highest average monthly insurance cost of $233, and Ohio being the cheapest at $84 per month.

The number of claims filed can also be influenced by factors such as age, gender, driving record, location, credit history, and type of vehicle. Younger and less experienced drivers tend to have higher insurance costs due to their higher involvement in crashes, with 15- to 34-year-olds causing nearly 40% of all crashes in the U.S. Additionally, the type of insurance coverage can impact the frequency of claims, with collision and comprehensive coverage being optional in some states.

It is important to note that there is no set limit to the number of claims that can be filed annually, but frequent claims can have negative consequences on insurance policies, including higher premiums and a loss of no-claim bonuses. When deciding whether to file a claim, it is recommended to consider the repair cost, deductibles, and the impact on future premiums.

The cost of filing an auto insurance claim

Motorists file insurance claims roughly once every 17.9 years, according to Fox Business. While this may seem like a long time, it means that by the age of 34, every person who has been driving since they were 16 is likely to have filed at least one car insurance claim.

The expenses associated with filing an insurance claim are not cheap and can range from a couple of hundred to a few thousand dollars. The deductible is the amount of out-of-pocket money the motorist is responsible for paying before the insurance company covers the remainder. For example, if you have a $200 deductible and suffer $2,000 worth of damage to your vehicle, you need to pay $200, while the insurance company pays the rest.

Policyholders can lower their monthly premiums by raising their deductible. However, when the unexpected happens, those paying low premiums will end up having to pay much more. For instance, if you choose to raise your $200 deductible to $1,000, you'll save money monthly, but you'll need to pay $1,000 if you are in an accident or damage your car.

According to the Institute of Insurance Information, property damage liability claims cost the average motorist $3,290 annually, while the average claim for bodily injury was $16,640, and the average claim for collision insurance was $3,160.

In addition to the direct costs of filing a claim, there are also potential indirect costs in the form of increased insurance premiums. Premiums can increase by almost 50% after an at-fault accident claim, according to an analysis by The Zebra, an insurance comparison website. This increase can last for at least three years.

When deciding whether to file a claim, it is important to consider the cost of repairing your car compared to the cost of your insurance policy deductible. If the cost of repair is less than or near your deductible amount, it may not make financial sense to file a claim, as you will likely end up paying more in increased premiums than you would have paid out of pocket for the repairs.

The impact of multiple claims on an auto insurance policy

Motorists file insurance claims roughly once every 17.9 years, according to Fox Business. This means that by the age of 34, every person driving since they were 16 is likely to have filed at least one car insurance claim.

The primary effect of multiple claims on auto insurance is increased rates. A second, less likely, possibility is that of policy cancellation or non-renewal.

Increased Rates

On average, an at-fault collision claim raises insurance rates by $64 per month, or $384 per six-month policy period. Collision claims often increase rates more than comprehensive claims. An at-fault collision claim is considerably more expensive than a comprehensive claim, which covers incidents outside of the insured driver's control, such as vandalism, theft, or damage from weather.

Policy Cancellation or Non-Renewal

Most insurance companies will drop a client after three claims over a three-year period, no matter the type of claim. However, an insurer cannot cancel a policy mid-term if a client has made multiple claims, but they may choose not to renew the policy.

The pros and cons of filing a claim for small amounts

The decision to file an auto insurance claim for small amounts depends on various factors, and there are pros and cons to each choice.

Pros of Filing an Auto Insurance Claim for Small Amounts:

• Filing a claim can provide financial relief and help cover the costs of repairs or replacements for damage to your vehicle.
• If you are not at fault, filing a claim ensures that the other driver's insurance company covers the costs, rather than you having to pay out of pocket.
• Filing a claim can also help cover legal costs if you are taken to court due to the accident.
• In the case of injuries, filing a claim can provide compensation for medical expenses and protect you from potential future claims.

Cons of Filing an Auto Insurance Claim for Small Amounts:

• One of the main drawbacks of filing an auto insurance claim for small amounts is the potential increase in insurance premiums. Even a minor claim can lead to higher premiums for several years.
• Filing a claim may also affect your insurance score negatively, especially if you have a history of claims or a lower credit score.
• There is a deductible amount that you must pay out of pocket before your insurance coverage kicks in. For small amounts, the deductible may be higher than the repair costs, making the claim unnecessary.
• Filing a claim can be a lengthy process, requiring gathering information, assessing damage, obtaining repair estimates, and following up with the insurance company.
• In some cases, if the damage is minor and you are at fault, it may be simpler and more cost-effective to pay for the repairs yourself rather than go through the claims process and risk increased premiums.

The process of filing an auto insurance claim

Motorists file insurance claims roughly once every 17.9 years, according to Fox Business. While this may seem like a long time for younger drivers, this means that by the age of 34, everyone who has been driving since they were 16 is likely to have filed at least one car insurance claim.

• Contact your insurance provider as soon as possible: Even if the accident appears minor, it is important to inform your insurance company about the incident and to find out whether your auto insurance policy covers you for the particular loss. Some insurance companies offer mobile apps that allow you to report a claim, check its status, upload photos, and perform other tasks.
• Gather relevant evidence and documentation: Before contacting your insurance company, call the police, record the details of the incident, and take steps to limit your liability. Take photos or notes of any car involved, not just your own, and get information about the other driver, including their name, phone number, license plate, vehicle make and model, insurance company, and policy number.
• Call your insurance company to file a claim: After gathering the relevant documents and materials, call to open a case and work with an insurance claims adjuster to determine your settlement and payout. The claims adjuster will determine the value of the damage and the appropriate compensation based on your policy. They will manage your case on behalf of the insurance company and take the necessary steps to settle your claim.
• Understand the timing of your claim: Ask your insurance provider about any time limits for filing claims, submitting bills, and resolving claims disputes. Also, inquire about deadlines for submitting additional information and when you can expect the insurance company to contact you.
• Provide the requested information to your insurer: Carefully fill out the claim forms and keep thorough and organized records of anything related to the claim, including the names and phone numbers of everyone you speak with at your insurer and copies of any bills related to the accident.
• Understand the claim settlement and payout process: The adjuster will determine the cost of the damage, appropriate compensation, and any additional steps needed to repair your car. Understand local regulations regarding insurer response times, why claims are rejected, and how to negotiate payouts.
• Consider negotiating the settlement offer: If you are not satisfied with your settlement offer, you can negotiate with your provider by providing evidence to support your claim, such as medical records, police reports, and similar cases.

Frequently asked questions