You can switch car insurance companies after an accident, but insurers may charge a cancellation fee if you change policies before your term ends. Car insurance costs an average of $883 per year for drivers with clean records, but this increases to $1,091 annually if you shop for the cheapest rates after an accident, a 24% rate increase. Compare quotes from multiple insurers before switching to ensure you're getting a better rate despite the accident on your record.
Switching Car Insurance After an Accident
Updated: February 13, 2026
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Key Takeaways
You can switch insurers after an accident, even with an open claim, but your current provider may charge a cancellation fee ranging from $25 to $50 if you end your policy early.
An accident increases your premiums by 24% on average with any insurer because your risk profile has changed.
Maintain continuous coverage when switching insurers to avoid penalties or gaps that could leave you uninsured and at financial risk. Purchase your new policy before canceling your current one.
If your current insurer includes accident forgiveness that you've already qualified for, switching to a new insurer means starting over with a new waiting period of three to five years before accident forgiveness becomes available again.
Can You Switch Car Insurance After an Accident?
What to Consider Before Switching Car Insurance After an Accident
Switching car insurance companies is always an option. Had an accident recently? You'll want to weigh a few considerations before making the move.
Your premiums will increase
An accident raises your rates by 24% on average, especially if you're at fault. Insurance companies can't change premiums during your policy period, so your current insurer's rates remain locked until renewal.
Shop around and compare these rate increases from State Farm, GEICO and Progressive to find the best deal before deciding whether to switch.
The best and cheapest company varies by person
The best car insurance company and the cheapest provider are not always the same. Price matters, but service quality affects your experience when you file claims. If your current insurer provides excellent service and handles your accident claim well, staying with it may be better than switching for a small savings.
You may have to pay cancellation fees
Most insurers charge $25 to $50 for ending your policy mid-term, though some waive fees after the first 30 days. Allstate and Farmers typically charge $50, while State Farm and GEICO charge $25 to $35. Stay with your current insurer until your policy expires to avoid these fees, or factor in cancellation costs when comparing prices and considering if switch is worth it or not.
You may be eligible for a prorated refund
Check if your insurer offers prorated refunds for unused premiums when you cancel mid-term. Progressive and GEICO typically refund your unused premium minus any cancellation fee. Some insurers calculate your refund using a short-rate penalty, which reduces your refund by 10% to 15% as an administrative fee.
You could lose discounts and coverages
Switching car insurance might cause you to lose loyalty discounts, accident forgiveness or special coverage from your former insurer. State Farm's accident forgiveness program comes automatically with full coverage policies and waives rate increases for your first at-fault accident after three years of continuous coverage. Before signing up for a new policy, verify that the new rate is lower than your current rate, including all auto insurance discounts.
How to Switch Car Insurance After an Accident
Switching is actually pretty straightforward once you know what to do. Find the right coverage from a new company and contact your old insurer. Contact your new insurer first, then notify your current provider to coordinate the switch. Purchase your new policy before canceling to avoid coverage lapses.
- 1Determine how much coverage you need
Your first step is to determine how much car insurance you need. State minimums vary by location, and your recent accident affects what coverage you can afford. Review your state's minimum liability requirements and compare them to full coverage options that include comprehensive and collision protection. Full coverage costs more but provides better financial security if you have another accident.
- 2Evaluate cancellation fees and refunds
Call your current insurer to ask about cancellation fees and prorated refunds. Most insurers charge $25 to $50 for mid-term cancellations, though some offer free cancellation after the first 30 days. If you have an open claim, ask how canceling it affects your claim settlement.
- 3Research and compare car insurance quotes
State Farm, GEICO, and Progressive offer the best car insurance after an accident with competitive rates, though premiums remain higher than for drivers with a clean record. Request quotes from at least three insurers and compare the total annual cost, not just monthly payments. Some insurers specialize in high-risk drivers and may offer better rates than your current provider. Compare providers' coverage and pricing to determine which company offers the best combination for your situation.
- 4Buy a new policy before canceling your current one
A lapse in coverage causes multiple problems, including rate increases of 10% to 20% and potential license suspension. If you have an accident while uninsured, you'll pay for damages yourself and face fines ranging from $500 to $5,000, depending on your state. Purchase your new policy with an effective date that starts the day your old policy ends.
- 5Replace your old ID with your new one
Update your physical or digital insurance card immediately after your new policy activates. Keep your new insurer's card in your wallet or glove box, or download the company's mobile app for digital proof of insurance.
How to Lower Car Insurance Rates After an Accident
Insurance companies charge higher rates after a collision because they view you as high-risk. You can still reduce your car insurance costs through discounts, higher deductibles and defensive driving courses.
Location, age, credit score, car type, coverage needs and driving record all affect insurance costs. Your premiums increase by an average of $208 annually when your plan renews or when you switch insurers after an accident. Follow the strategies below to help lower premiums after an accident.
- 1Tell your insurer about the accident immediately
Inform your insurer about the accident immediately, regardless of severity. Failing to report an accident within 24 to 48 hours could give your insurance company grounds to deny coverage under your policy. State Farm and GEICO both require accident reporting within 24 hours, while Progressive allows 48 hours.
- 2Take a defensive driving course
Defensive driving courses reduce premiums by 5% to 10% with most insurers. State Farm, GEICO and Progressive all offer defensive driving discounts after you complete a state-approved course. Courses cost $25 to $50 and take 4 to 8 hours to complete, online or in person.
- 3Increase your deductible
Choosing a higher deductible reduces your premium by 15% to 30%. Raising your deductible from $500 to $1,000 can save you $200 to $300 annually with most insurers. You'll pay more out of pocket if you have another accident, so only choose a deductible you can afford to pay.
- 4Check for discounts
Insurers offer various discounts that can save you money. Common discounts include:
- Bundling discounts: Save 15% to 25% by combining auto and home insurance
- Safe driving discounts: Earn 10% to 15% off after three years without accidents
- Good student discounts: Students with 3.0 GPAs save 10% to 25%
- Payment discounts: Pay in full annually instead of monthly to save 5% to 10%
Some companies also offer discounts based on your education level, age and payment terms. Compare insurance companies and find discounts that match your situation.
- 5Shop for a new policy
Shopping for a new policy might reveal better rates from other insurers. While you'll pay more than you did with a clean driving record, State Farm, GEICO or Progressive might offer lower rates than your current provider. State Farm offers the most affordable full coverage at $120 monthly for drivers with accidents. Your current insurer might also match a new policy quote if you ask, potentially saving you the hassle of switching.
Switching Car Insurance Companies After an Accident: Bottom Line
Switching car insurance after an accident is possible, even with an open claim. Expect rates to increase by 24% on average, adding $208 annually, and potential cancellation fees ranging from $25 to $50. Compare quotes from State Farm, GEICO and Progressive to find the best rate for drivers with accidents. State Farm offers the lowest rate at $120 per month for full coverage. Purchase your new policy before canceling your current one to maintain continuous coverage and avoid penalties.
Switching Car Insurance: FAQ
We answered frequently asked questions about changing policies, potential fees and how accidents impact your insurance rates.
Can I switch car insurance after an accident?
You can change your policy anytime. You may need to pay a cancellation fee, and a collision on your record could increase your insurance rates.
Can I cancel my insurance policy after filing a claim?
You can still cancel your policy, and your current insurer will still honor your claim.
Is there a fee for switching car insurance companies?
Some providers charge a cancellation fee, while others offer prorated refunds. Check your terms and policies before switching car insurance companies.
By how much will my insurance rates increase after a crash?
The average cost of car insurance is $1,424 per year for a driver with a clean record, while a driver with a record pays $2,237.
Is there a way to reduce insurance premiums after an accident?
Taking a defensive driving course, increasing your deductibles and maximizing car insurance discounts can help lower costs when you look for a new car insurance provider.
How do I avoid a lapse in coverage while switching companies?
Buy your new policy before canceling your current one, and ensure you’ve paid all fees.
Changing Car Insurance After an Accident: Our Review Methodology
MoneyGeek provides unbiased car insurance reviews and comparisons. Our insurance industry experts create reviews, guides, and comparison tools to help you find coverage that fits your needs. You can also get free quotes to compare rates before you buy.
Our Data Sources
We identified the top car insurance companies for post-accident coverage using data from:
- National Association of Insurance Commissioners (NAIC): The agency that regulates insurance companies
- J.D. Power: Measures how satisfied customers are with their insurers
- AM Best: Rates insurance companies' financial strength
- Better Business Bureau: Tracks consumer complaints and business practices
Expert Insights
Three insurance professionals helped us understand what drivers should do after accidents:
- Matthew Davis: President and CEO of GDI Insurance Agency
- John Espenschied: Owner of Insurance Brokers Group
- Lauren Mckenzie: Insurance agent and broker at A Plus Insurance
Our Editorial Standards
MoneyGeek's editorial team researches financial topics and creates content that answers your questions. We follow strict editorial guidelines to deliver accurate, trustworthy information.
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About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. He has analyzed the insurance market for over five years, conducting original research for insurance shoppers. His insights have been featured in CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
He writes about economics and insurance, breaking down complex topics so people know what they're buying.