How Much Does Car Insurance Increase After An Accident?
Car insurance premium increases after an accident depend on insurance type (CTI vs. commercial), accident severity, and claims frequency. Generally, a single at-fault accident typically raises compulsory traffic insurance (CTI) by 10%-30% if involving fatalities, while commercial insurance premiums may increase 15%-30% for first-time claims.
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How does compulsory traffic insurance (CTI) change after an accident?
CTI premiums rise 0%-30% based on accident severity. A no-fatality claim restores rates to base price, while fatal accidents trigger 30% hikes. For example, a 6-seat vehicle’s CTI base rate of ¥950 would jump to ¥1,235 after fatal incidents.
Basic CTI calculations follow standardized brackets:
- No claims: Annual 10% discount (max 30% over 3 years)
- 1 non-fatal claim: Reset to ¥950 from potential discounted rates like ¥855
- 1 fatal claim: 30% surcharge (¥950→¥1,235)
Practically speaking, minor fender-benders often don’t justify CTI claims given the loss of multi-year discounts. Pro Tip: For repairs under ¥2,000, consider private settlement to preserve CTI discounts.
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What’s the commercial insurance impact after one accident?
Commercial premiums increase 15%-30% for first claims, with subsequent claims compounding adjustments. A ¥5,000 premium might rise to ¥5,750 (15%) or ¥6,500 (30%), depending on insurer risk models and driver history.
Three key factors determine commercial rate hikes:
| Factor | Low Impact | High Impact |
|---|---|---|
| Claim Amount | <¥10,000 | >¥50,000 |
| Driver Fault % | <50% Liability | 100% Liability |
| Claim Frequency | 1 in 3 years | 2+ in 1 year |
Consider this real-world scenario: A driver with five years’ no-claim history experiences a ¥35,000 at-fault collision. Their commercial premium could increase 20% for three subsequent years, totaling 60% cumulative extra costs. Why tolerate this? Many drivers underestimate how single claims reset multi-year no-claim discounts.
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FAQs
Do all accidents trigger premium increases?No—not-at-fault claims (e.g., hit-and-run with police report) usually don’t affect rates if properly documented.
How long do premium surcharges last?
Typically 3 years for commercial insurance, though CTI resets annually based on latest claim history.
Can I avoid increases by switching insurers?
Generally no—insurers share claims data through industry databases, making past claims visible for 5 years.