By: Robbie Hoye on May 19th, 2023
How Surcharges Affect Auto Insurance
There is a lot to worry about when involved in a car accident. Potential vehicle damage, injuries, wondering how you’re going to get around until your vehicle is fixed - it’s a lot for anyone to digest. On top of all of that, you also have to worry about the accident affecting the price of your auto insurance. Unfortunately, drivers who are at fault for an accident or receive a ticket can expect a surcharge to be applied to their auto policy.
This naturally yields many questions from drivers, such as: “How much will it cost?” “How long will it last?” or “How can I avoid surcharges entirely?”
At Berry Insurance, we understand that no driver wants to feel as if they’re being punished after an accident - which is why in this article we will be breaking down what surcharges are, how they affect your policy, and how you can avoid them in the future.
What is a car insurance surcharge?
An auto insurance surcharge is a fee applied to your insurance premium, typically applied by your insurance provider because you have demonstrated some degree of risky behavior while driving.
Surchargeable offenses usually include being at fault for an accident (such as rear-ending another driver) or receiving a ticket for speeding, traffic violations, or DUI.
These events are used by insurers as indicators of the increased risk of insuring the driver, as they may cause more claims or losses in the future. However, policyholders should be aware that surchargeable offenses can vary between each state and insurance providers.
How does a surcharge affect my policy?
The surcharge fee applied to your auto policy will subsequently raise your premium payments moving forward.
The exact amount you can expect to pay after a surcharge will depend on your insurance company and the severity of the event. In Massachusetts, each at-fault accident or traffic violation will have a specific surcharge point value applied to it. Your insurance premium will increase based on the amount of surcharge points you accumulate.
When it comes to accidents for Massachusetts drivers, there are two levels of surcharge, minor and major. Drivers can expect any claims that pay out over $5,000 to be considered a “major at fault loss”, affecting your policy more than a minor incident. For example, drivers responsible for an accident that totals another vehicle or injures another person would receive a greater surcharge than a minor fender-bender.
How long will a surcharge last?
The length of a surcharge can also depend on the insurance provider, state, and cause of the surcharge. Typically in Massachusetts, drivers can expect surcharges to last three to six years before they are removed, depending on the specific incident.
Drivers should note that it is possible to receive multiple surcharges on your policy at once, if you are involved in another at fault accident or surchargeable offense - resulting in a greater impact on your premium.
How can I avoid surcharges?
The best way drivers can prevent surcharges being applied to their policy is to practice safe driving techniques to the best of their ability. However, having accident forgiveness coverage on your policy can also be helpful in the event of an incident.
Of course, even the most cautious of drivers can find themselves involved in an accident, making it important to know what to expect from auto insurance claims. To learn how to avoid some of the most common claims, read our article on the top auto insurance claims in Massachusetts.
Saving after surcharges
We understand that getting a surcharge on your policy can feel like the cherry on top of an already bad situation. But surcharges are unlikely to last forever and will not typically cause an excessive increase of one’s premium.
While you can’t do anything to remove a surcharge after it has been applied to your policy, there may be other ways that you can save money on your policy. To learn about the tips Berry Insurance recommends when looking to save on your auto policy, check out this guide: 13 Ways to Save On Your Auto Insurance.