{"id":1270,"date":"2021-08-19T06:45:00","date_gmt":"2021-08-19T13:45:00","guid":{"rendered":"https:\/\/freedomgeneral.com\/blog\/?p=1270"},"modified":"2021-08-11T06:54:43","modified_gmt":"2021-08-11T13:54:43","slug":"what-is-a-car-insurance-surcharge","status":"publish","type":"post","link":"https:\/\/freedomgeneral.com\/blog\/what-is-a-car-insurance-surcharge\/","title":{"rendered":"What is a Car Insurance Surcharge?"},"content":{"rendered":"\n

A car insurance surcharge is any added fee that your insurance company<\/a> attaches to your monthly premium. Usually temporary, these fees usually come after you\u2019ve done something the insurance company considers to increase your risk as a driver, such as an accident<\/a> where you were found to be at fault.<\/p>\n\n\n\n

When you\u2019re already paying a monthly premium for your insurance, you want to avoid letting it cause an even greater impact to your budget by tacking on an additional surcharge if possible.<\/p>\n\n\n\n

Here\u2019s everything you need to know about car insurance surcharges, why they occur, and how you can successfully avoid them.<\/p>\n\n\n\n

Car Insurance Surcharge Definition<\/h2>\n\n\n\n

Anytime your insurance premiums are temporarily raised in order to penalize you for some action or inaction relating to your insurance, you\u2019ve received a car insurance surcharge. Car insurance surcharges are financial penalties that insurance agencies use to offset the cost associated with your coverage\u2014 usually when you\u2019ve had an at-fault accident or you\u2019ve filed what they consider to be an excessive number of covered claims. <\/p>\n\n\n\n

Other factors can lead to car insurance surcharges, too, such as traffic tickets or lapses in coverage. <\/p>\n\n\n\n

Basically, anytime you do something that leads your insurer to consider you riskier to insure, you can probably expect to receive an insurance surcharge tacked on to your monthly premium in the near future.<\/p>\n\n\n\n

How Car Insurance Surcharges Work<\/h2>\n\n\n\n

If a car insurance company pays out more to you in covered losses than they make back from your monthly premiums, then they\u2019re experiencing a financial loss from your policy. Since nearly all insurance companies are businesses rather than nonprofits, they need to find a way to shift the balance so that risky drivers who file more claims also pay higher premiums to make up for them.<\/p>\n\n\n\n

Enter car insurance surcharges, which are a quick way for insurance companies to recoup some of the costs that have come from insuring a riskier driver. <\/p>\n\n\n\n

In some cases, companies use an automated system to assess driver risk and determine whether a surcharge should be added, and how much. In other cases, employees assess drivers on a case-by-case basis. For each customer and potential customer, insurers put together a \u2018customer profile\u2019 that they use to assess how risky that person is likely to be as a driver. Do all people who meet certain criteria have more accidents and file more claims? Of course not. Teenagers, for example, are considered higher risk drivers\u2014 but many never have an at-fault accident. Insurance companies are simply in the business of weighing risk versus profit when choosing whether to insure each individual.<\/p>\n\n\n\n

What Causes a Car Insurance Surcharge<\/h2>\n\n\n\n

No one wants to have their monthly insurance premiums go up thanks to a surcharge. But how can you avoid them? Some factors that boost insurance rates are outside of your control, such as your age, time spent in total as a licensed driver, and where you live. But there are other factors that come into play that you can generally avoid by being a safe, responsible, and aware driver. Driving safely doesn\u2019t just save your life\u2014 it can also save you a significant amount of money.<\/p>\n\n\n\n

Causing Damage to Someone\u2019s Property<\/h3>\n\n\n\n

If your actions while behind the wheel cause damage to someone else\u2019s property, including mailboxes, buildings and structures, or other possessions, and you submit a claim through your insurance, you can probably expect a car insurance surcharge to appear on your next insurance billing statement. This isn\u2019t always the case, but causing property damage is one of the most common reasons for added surcharges.<\/p>\n\n\n\n

Causing a Collision with Another Driver<\/h3>\n\n\n\n

If you\u2019re involved in a collision with another driver in another vehicle, and you\u2019re found to be at fault, you may find yourself looking at an added surcharge on your monthly insurance premium. While your rates may not rise during the current period (usually six months), they may rise when it comes time to renew your policy.<\/p>\n\n\n\n

There are exceptions to this. Some insurers offer various versions of what\u2019s called \u2018accident forgiveness,\u2019 where first-time collisions won\u2019t result in a rate hike. Other insurers will take into account loyalty when determining rates. If you are involved in an at-fault collision and submit a claim, but you\u2019ve been covered by the same insurer for ten years, they may let it slide without increasing your premiums right away.<\/p>\n\n\n\n

Causing Bodily Injury to Someone<\/h3>\n\n\n\n

If you\u2019re responsible for an accident that\u2019s severe enough that it causes enough bodily harm to a 3rd party that they need medical treatment, you will likely be hit with a car insurance surcharge on your next billing cycle. This is particularly true considering that medical payouts from insurance companies can be substantial, so your insurer will likely be looking to offset some of those costs.<\/p>\n\n\n\n

How to Avoid a Car Insurance Surcharge<\/h2>\n\n\n\n

The rules for the implementation of surcharges vary from state<\/a> to state<\/a>. For example, in Massachusetts, you\u2019ll only experience a surcharge if you submit a claim over $1,000 for an accident when you\u2019re found to be more than 50% at fault legally.<\/p>\n\n\n\n

The best way to avoid car insurance surcharges? Avoid accidents by being a defensive driver and making safe choices while on the road. That\u2019s the best and simplest way to keep your insurance rates down and your personal and financial safety intact. <\/p>\n\n\n\n

Conclusion<\/h2>\n\n\n\n

Looking for more information about car insurance, including whether you\u2019ll have a car insurance surcharge and other specific needs? Freedom National<\/a> is deeply experienced with providing non-car owners with insurance policies to suit their unique needs. You\u2019ll find everything you need to create the perfect policy for you thanks to our fast online quote form, where you can provide details about your insurance needs and receive a quote in minutes. And because we work with a wide network of insurers, you can be assured that you\u2019re getting the best possible rate.<\/p>\n\n\n\n

Our simple process lets you fill out a quote in minutes, learn more about car insurance<\/a> and common car insurance terms<\/a>, and get covered right away with a customized policy just for your unique needs.<\/p>\n","protected":false},"excerpt":{"rendered":"

A car insurance surcharge is any added fee that your insurance company attaches to your monthly premium. Usually temporary, these fees usually come after you\u2019ve done something the insurance company considers to increase your risk as a driver, such as an accident where you were found to be at fault. When you\u2019re already paying a monthly premium for your insurance, you want to avoid letting it cause an even greater impact to your budget by tacking on an additional surcharge if possible. Here\u2019s everything you need to know about car insurance surcharges, why they occur, and how you can successfully <\/p>\n","protected":false},"author":7,"featured_media":1287,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"yoast_head":"\nWhat is a Car Insurance Surcharge?<\/title>\n<meta name=\"description\" content=\"A car insurance surcharge is an extra charge that raises your premium. 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