Will My Car Insurance Rates Increase if I Bring an Injury Claim Under My Own Insurance Policy?

Will My Car Insurance Rates Increase if I Bring an Injury Claim Under My Own Insurance Policy?

Our personal injury attorneys are often asked about insurance rates. Specifically, clients ask if their car insurance rates will increase if they bring an injury claim under their own insurance policy.  The simple answer to this is no. A person’s car insurance rates should not increase if they bring an injury claim under their own insurance policy.

What Kind of Injury Claims Can a Person Bring Under their Own Car Insurance?

A person can typically bring two types of claims under their own car insurance after being injured in a car accident. However, whether or not a person can bring these claims depends on the type of car insurance coverage they have. The coverages that allow a person to bring claims for their injuries following a crash are optional coverages. As such, if a person did not buy the coverage when obtaining his or her policy, he or she will not be able to advance a claim.

Uninsured Or Underinsured Motorist Coverage Allows Someone to Bring an Injury Claim Under Their Own Car Insurance

The first optional coverage that someone may have that allows them to bring an injury claim is called Uninsured / Underinsured Motorist coverage. However, as the name suggests, these coverages do not apply in all circumstances. The only time these coverages may be used are when the at-fault driver does not have insurance or does not have enough insurance.

If either of these two situations exist, then a person who has Uninsured or Underinsured Motorist coverage, may seek to recover for their injuries directly from their own car insurance. In this situation, their car insurance company will pay for that individual’s medical expenses, lost wages, past and future impairment and pain and suffering. The injured person’s insurance company will evaluate the claim exactly like an insurance company would if their insured was the one at fault.

The injured person’s insurance company will evaluate the claim exactly like an insurance company would if their insured was the one at fault.

This puts the person’s own insurance company into direct conflict with him or her. The insurance company will be attempting to pay as little as possible and will try to downplay the injuries of the person asserting a claim. If you find yourself in this situation, it is important to consult with an attorney to understand your rights and how best to handle this situation.

Medical Payments or Med Pay Coverage Allows a Person to Recover Expenses from Their Own Insurance

Medical Payments coverage, often called Med Pay for short, is a coverage someone can obtain that allows them to recover from their own car insurance company. It is an optional coverage like Uninsured / Underinsured Motorist coverage. Someone who is injured may use this coverage if they are injured in a car accident and receive medical treatment for their injuries.

The medical treatment must be needed as a result of the crash. The medical expenses must also be reasonable. If either of these things are not true, then an insurance company may deny or limit coverage.

A person who has Med Pay coverage may seek to recover money, from their own insurance company, for medical treatment they receive. Most of the time, they may receive money for their medical expenses regardless of whether or not they have another source that will pay those medical expenses. In sum, even in situations where health insurance covers their medical expenses, they may still seek to recover Medical Payment benefits.

Car Insurance Rates Should Not Increase if You Bring an Injury Claim for a Car Accident Where You are Not at Fault

Your car insurance premium rates should never increase for bringing a claim for an accident when you are not at fault. This is common sense. Car insurance premium rates are determined by several factors. One of those factors is the risk of the insured drivers.

Your car insurance premium rates should never increase for bringing a claim for an accident when you are not at fault.

Understandably, the more car accidents someone is responsible for causing, the more of a driving risk they are. The bigger risk a driver poses to the insurance company, the more that person should have to pay for coverage. Someone who has been found at fault for causing several car accidents will be charged a higher premium than someone who has never been found at fault for causing a car accident.

If someone is in a car accident that is found to not be their fault, their can insurance premium should not increase. In that situation, nothing has changed as far as the risk that the insurance company is exposed to. That driver was operating his vehicle reasonably and prudently, but they were unfortunately involved in a car crash due to no fault of their own. That person should not be penalized by a raise in his or her car insurance rates.

Arizona Law Prohibits the Raising of Car Insurance Rates for Car Accidents of Someone Who Is Not At Fault

Under Arizona law, your car insurance rates should not increase if you bring a claim for a car accident if you were not at fault. In fact, legislation in Arizona specifically prohibits this. Arizona Revised Statute Section 20-263 A. sets forth:

“No insurer shall increase the motor vehicle insurance premium of an insured as a result of an accident not caused or significantly contributed to by the actions of the insured. Any insurer which increases the premium as a result of accident involvement shall notify the insured of the reason for such increase.”

The Arizona Department of Insurance Has Told Insurance Companies Not to Raise Rates In This Situation

The Arizona Department of Insurance and Financial Institutions is the regulatory agency that controls insurance companies that operate in Arizona. In 2020, they issued a Regulatory Bulletin addressing the raising of insurance rates for accidents when an insured driver is not at fault. The Regulatory Bulletin was issued as number 2020-06.

The Bulletin interpreted Arizona Revised Statute Section 20-263 A. The Bulletin found that statute to limit the underwriting process and to prohibit premium increases for an accident not significantly contributed to by the actions of both currently insured drivers and those seeking new coverage. The bulletin stated:

“Because the statute’s main effect is to place a limitation on the insurance underwriting process, applying a distinction between “insured” and “applicants” here would create inequitable and absurd results…the Department concludes that ARS Section 20-263(A) prohibits an insurer from increasing premium[s] on an automobile policy, including surcharges, eliminating discounts, placing the insured in a higher rating tier, or charging a higher base rate, unless the insurer determines and can demonstrate that the insured caused or significantly contributed to the historical damage contained in a vehicle history report…the statute prohibits any increases to the total premium charged for the policy.

What Factors Can Legally Cause an Increase in Car Insurance Premium Rates

As explained above, it is illegal for a car insurance company to raise premium rates in Arizona for a car accident that was not your fault. However, car insurance companies can raise rates for many other reasons. Some of those reasons may include:

• An increase in the amount of miles driven
• The addition of other drivers
• An increase in the costs of medical expenses in the area
• An increase in the costs of replacing or repairing the vehicle
• A change in the geographic area where the vehicle is operated
• An increase in the policy coverage limits
• A decrease in the deductible
• An increase in moving violations or traffic infractions
• An increase in at-fault car accidents
• A change in marital status

All of the above factors increase the financial risk to the insurance company. As a result, they may legally consider these factors in the underwriting process and increase premium rates as needed to match their increased risk.

Make Sure to Accurately Report Underwriting Information to Your Car Insurance Company

Since car insurance companies base premium rates on the information received during the underwriting process, it is critical that an insured or applicant accurately report this information. The failure to do so could result in an exclusion from coverage later.

For example, take a situation where someone reports to their insurance company that they only drive their car 1000 miles per year, but they actually drive it 10,000 miles per year. Under that scenario, the insurance company has assessed its financial risk based upon the very low miles that the car is driven and the lower accident exposure for the vehicle. If someone has misrepresented the degree of risk to the insurance company, then they are at risk of their claim being denied later due to that misrepresentation.

Contact an Experienced Scottsdale Car Accident Attorney Today              

Contact Scottsdale Injury Lawyers today if you or a loved one has an insurance claim for injuries suffered in a car accident. Our car accident attorneys are experts in car insurance and the handling of car insurance claims. We will help you navigate the coverages and will maximize the amount of compensation you are entitled to receive. A consultation is free and we only earn a fee if we recover for you.

About the author: The content on this page was provided by Scottsdale personal injury attorney and civil rights lawyer Tony Piccuta. Piccuta graduated with honors from Indiana University-Maurer School of Law in Bloomington, Indiana (Previously Ranked Top 35 US News & World Report).  Piccuta took and passed the State bars of Arizona, California, Illinois and Nevada (all on the first try). He actively practices throughout Arizona and California. He is a trial attorney that regularly handles serious personal injury cases and civil rights lawsuits. He has obtained six and seven figure verdicts in both state and federal court. He has been recognized by Super Lawyers for six years straight. He is a member of the Arizona Association of Justice, Maricopa County Bar Association, Scottsdale Bar Association, American Association for Justice, National Police Accountability Project and Consumer Attorneys of California, among other organizations.

Disclaimer: The information on this web site is for informational purposes only and does not constitute legal advice. The information on this page is attorney advertising. Reading and relying upon the content on this page does not create an attorney-client relationship. If you are seeking legal advice, you should contact our law firm for a free consultation and to discuss your specific case and issues.

[1] https://www.azleg.gov/ars/20/00263.htm

[2] https://difi.az.gov/sites/default/files/Bulletins/Regulatory%20Bulletin%202020-06_0.pdf