What’s a Chargeable Incident and Does It Affect Your Insurance?
If you have a vehicle, we’ll go ahead and assume you have car insurance (and if you don’t have insurance, now is a great time to get it!). This also means you’re probably aware that the amount you pay for your auto insurance is highly influenced by your driving history, such as the number of accidents you’ve been in and how many tickets you have — among other factors of course. This even includes the driving records of anyone listed on your policy. These factors are otherwise known as chargeable incidents.
But what exactly does your insurance company deem ‘chargeable’ and therefore raising your insurance premium? Here’s a high-level look at chargeable incidents and how they can affect the rate you pay for insurance.
What Is a Chargeable Incident?
A chargeable incident can either involve an accident or a violation. It is an insurance-reported incident where you are either at-fault for an accident, ticketed or summoned to court. Usually, when you’re deemed 50% or more at fault for an accident and the claim is over a certain dollar amount, your insurance company will consider the accident ‘chargeable’ — and that’s when they’ll apply a surcharge to your premium.
There are two main types of chargeable incidents: Accidents and violations.
A chargeable accident means it was an at-fault accident where you caused damage to another person’s property or bodily injury, whether it be a simple fender bender or a more serious accident where you total someone else’s car.
A chargeable violation means you’ve been convicted of a driving violation, like getting a ticket or citation. For example, speeding tickets, driving under the influence, driving while your license is suspended or revoked, or failure to stop and report if you’re involved in an accident.
What Is a Surcharge?
You know that hike you see in your premium after an accident, ticket or citation? That’s your car insurance surcharge. Or, in other words, it’s the penalty your insurance company shells out for your driving blunder. We understand that it’s frustrating when you see a hike in your premium, but the reason your insurer applies a surcharge is because a person who has an accident, ticket or citation is more likely to be involved in an accident in the future. So your rate will raise because you’re considered a greater risk to your insurance company, and consequently you have to pay more for your insurance because of that risk. You'll pay more for your insurance while you prove that you are a good driver, and, thankfully, this premium increase will eventually fall off. The surcharge will last different amounts of time depending on the chargeable incident, but usually it can last for a few years or even longer.
Keep in mind, a car insurance surcharge can actually be applied for other things that don’t involve chargeable incidents, like late payment fees (avoid this by signing up for auto pay), lapses in coverage and even your car insurance credit score.
How to Avoid a Surcharge
It’s as simple as staying out of trouble! In most cases, speeding tickets and other traffic violations are in your control. Follow the rules of the road and you can usually avoid that price increase. Sometimes an at-fault accident is because of your negligence and sometimes it’s out of your hands. Either way, do what you can to stay safe on the road by practicing safe driving habits. Here are some tips to stay safe behind the wheel by preventing distracted driving. And to really get serious about your safety, you can sign up for KnowYourDrive, a program to help you make smarter choices behind the wheel.