GEICO and rates after a fender-bender

I posted here a while back about having been in my first at-fault
fender-bender. Low speed, I was an idiot. Anyway, I decided it would be
best to report it ad get everything fixed by the book. ~$1500 on my car,
I dunno yet what was on the other guy's, but it was really just a
scraped rear bumper corner and slight scrape on the side panel, so
probably not too much. GEICO maybe paid $1500 total. I'll probably see
the details sometime or other.

So. Impact on my insurance? It went *down*, from $564 to $498/6 mos. And
after I took a defensive driving course thinking to head the adjusters
off at the pass, it went down further, to $452. That includes collision
($500 deductible) and full glass, and is about on par with the insurance
for my old 85 Pontiac wagon, on which I didn't have collision. 94 Civic EX.

Apparently I got lucky, though as I said, they didn't have to spend
much. I'm a little paranoid about landing in another mishap that will be
more severe, but given that I've managed for 16 years without anything
at-fault, I'll hope for the best.

Let's hear it for that 10% discount for that defensive driving course.
$35 through AAA and 6 hours of my time. Not a bad course, either.

 

There's a catch to your story. All at-fault claims will increase your
rates, and considering that auto insurance is a loss leader for the
providers then it is definately not in their interests to ignore
at-fault claims. There has to be more to your story.

 

GEICO(which I have) has some kind of policy currently which goes
something like this: they reward their customers by not raising rates
for a single at fault accident if the customer has not had any accidents
in the last 5 years. I don't have the exact wording handy but that's
basically how it works.

Ken

 

I had a fender bender where I was at fault like you. It was very low speed
(backing out of a parking space) and caused approximately the same damage as
you and I had GEICO at the time. They didn't raise my rates until the next
year but they did, eventually. GEICO, does however, have some policies
where if you are a driver in a certain state things don't change much. For
instance, I got a speeding ticket long ago and was so upset they would raise
my rates when I called them. They said that since it was my first ticket
and I was living in a state that doesn't "hide" tickets with traffic schools
(like California) my rates wouldn't change.

Richard

 

Varies by state law too much to comment on the specifics of your
situation. However, it is the company's "underwriter", not the
adjuster, that may eventually look at your policy and decide to
"re-rate" it and increase your premium. Frequently this happens by
moving you to an alternate, "sub-standard" company that they own. This
could take a year or so to happen. Or might not happen at all.

By the way, underwriters look more to how many reported collisions you
have, not just the cost. A $500 claim is about as bad as a $10,000
claim.

JM

 

Is it how many claims, or how many collisions? For example, I rear-ended
someone and settled with him at the scene of the accident with cash, but
filed a claim for $1500 for the damage to my car. Would an additional
claim by the person I hit have made any difference in how the insurance
company perceives me as a risk?

Andrew

 

Fair enough, they reward their customers by not raising the rates for 1
at fault but your accident doesn't dissapear. Try switching companies in
the next 5 years and I'll bet the other companies will nail you on the
rates, which is what Geico anticipated when launching that program. Some
brokers will do the same thing and it looks like a reward but it's just
a way to guarantee you to them - as a customer for a few years.
Naturally the actuarial tables will show that should you have a 2nd at
fault in the 5 years then you're not the kind of customer they want and
then the change in your pricing will reflect that. Typically auto
insurance is a loss leader - do you have any other lines of business
with Geico and have they tried cross selling to you?

 

If your carrier understands that the accident was your fault, then I
don't think you likely gained anything by paying the liability portion
of the collision out of your own pocket. If you fibbed, and told your
carrier that you found the car in the parking lot that way (wrecked),
then it would not be handled as a collision claim but instead as a
comprehensive claim. I'm guessing here, but I think a comp claim would
be less likely to affect your rates, although you should not try this.
Too many comp claims will get you canceled, also.

JM

 

A $500 claim is about as bad as a $10,000

Well, let me update that thought a bit to account for inflation. I
know, for instance, that State Farm will increase your premium if they
pay a claim for more than $750 for which you are at fault. So, these
days, a "$750 claim is about as bad as a $7,500 claim." In other
words, there is a minimum amount, varying by insurance company, for
which they'll just pay it and forget it. Progressive, according to a
recent magazine article (Kiplinger, I think), will pay only $400 for an
at-fault claim without raising your premium.

JM

 

No, no cross selling--they haven't bothered me at all--seem happy to
have me with just the auto insurance. As far as what happens if I have
another at fault within 5 years, would any company consider a driver
with 2 at faults within 5 years as desireable? I'm not defending GEICO
but hey, if I did have 2 at faults in a row, maybe I deserve to have my
rates go up.

 

It's called Accident Forgiveness. Since my 5-year good driver discount
is still listed on my bill, it clearly kicked in. We'll see what happens
next year...

In NYC, BTW. I posted the current experience because when I started
looking into what would happen to rates after a first at-fault
collision, I found it difficult to find data. It would be nice to have a
site that tracked this sort of thing. Obviously the insurance companies
aren't going to provide it, so it would have to be based on user experience.