- Helping you drive happy

To File or Not to File: Will Filing a Car Insurance Claim Raise Your Rates?

WARNING: Car insurance rules and regulations may differ drastically from province to province across Canada. The rules outlined by Kanetix below are applicable in select provinces only. Please check with your insurance provider for more details regarding your coverage. This article is written and endorsed by Kanetix.

After paying your car insurance premiums on time for years, it's natural to assume that filing a claim is always the right thing to do. In many instances, it is. However, there are times when it causes more harm than good. Any short-term benefits you derive from filing an auto insurance claim may be negated by long-term consequences. Most notably, your insurance premiums could go up and stay that way for the foreseeable future.

How do you decide whether or not it makes sense to file a car insurance claim? Every situation is different, of course, but there are ways to figure out whether it's in your best interests to do so. By giving the matter a little thought, you're more likely to arrive at a decision that will prevent serious financial repercussions down the road.

Who is at Fault?
The first and most important thing to consider when deciding whether or not to file an auto insurance claim is who is at fault. Unfortunately, it isn't always clear. It's not a matter for conjecture, though. In most instances, the police will decide who is primarily at fault for an accident.

As a general rule, you should go ahead and file an auto insurance claim whenever you're involved in an accident that was completely beyond your control. If you are clearly not at fault, you should feel confident in the decision to file a claim. Your auto insurance provider shouldn't raise your premium if another driver obviously caused the accident. Whether someone sails through a stop sign or rear-ends you, chances are high that filing a claim is the right thing to do.

What happens if you are clearly at fault in the event of an accident? It will be tougher to decide whether or not to file a claim. In many cases, it may not be practical to do so. If you rear-end someone or merge into them after failing to check your blind spots, for example, you will almost certainly be declared at fault. If you file a claim under such circumstances, it will affect your premiums.

How Long will Your Premiums be Affected?
There is no quick and easy way to determine how long your premiums will be affected after filing a claim for an accident that was your fault. Furthermore, you can't instantly calculate how much your premiums will be affected. The consequences vary from province to province.
In Ontario, for instance, an at-fault auto accident will most likely increase your premiums by about 15%, and that increase will continue for six years. If you have more than one at-fault accident within a few years, your premiums could actually double and remain exorbitantly high for a long time to come. Therefore, it's in your best financial interests to avoid filing claims on at-fault accidents whenever possible.

Accident Forgiveness
In Canada, many auto insurance providers reward safe drivers by offering accident forgiveness. Accident forgiveness typically means that the first at-fault accident won't cause a significant increase in premiums. This option is only available to drivers who have spotless driving records, and it is only offered once. Check to find out whether accident forgiveness is available and whether you qualify. It's a nice fallback option in the event of an accident, and it will give you an out.

Due to the fact that you only get one "freebie," you should be very choosy about whether or not to file a claim for an at-fault accident. Doing so will permanently eliminate the option in the future. If you have another accident in which you are at fault, filing a claim on it will cause your premiums to increase. Some insurance companies may then consider the previous accident as well, which could cause your rates to really soar.

Talk it Out
Any time you are involved in an accident, you should discuss the options with your insurance provider. Your premiums won't be affected unless you file a claim, so it's perfectly safe to go ahead and discuss the possible consequences with an agent. In most cases, the insurance company should be able to perform a few calculations to give you an idea of whether or not your premiums will be dramatically affected. Keep in mind that this will only work if fault has been assigned. If it's still up in the air, you may have to wait.

Let’s say you have invested quite a bit of time on websites like and found yourself a cheap car insurance rate, you may be unwilling to risk raising your rate by filing a claim, and in some cases this unwillingness can be justified.

In the end, it doesn't make sense to file an auto insurance claim if the immediate benefits are minimal and the long-term consequences are considerable. Sure, you pay your premiums on time every month. However, you don't want to pay for the same accident for six to 10 years, so keep that in mind.