If you’ve been in an accident and had a claim paid out for your car, you’ll need to inform any new car insurance company of this incident. Even if you were on someone else’s auto insurance policy at the time, the obligation to disclose your previous accident remains.

This guide explores what you must disclose about an accident to a new car insurance company.

Key Highlights
  • You’ll need to disclose previous accidents when getting a new car insurance policy. 
  • If you were on someone else’s insurance policy, like your parents’ policy, at the time of your accident, you’ll still need to disclose the accident. 
  • Although it’s tempting to skip telling the insurance company about an accident, leaving out this information can come back to haunt you. 

Do I have to tell insurers about an accident on my parents’ car insurance policy?

Yes, if you got into a car accident while on your parents’ auto insurance policy, you must tell current or future insurers about the incident. Even though the claim was filed under a previous policy, the accident reflects your driving behaviors. 

Why an old accident matters when applying for your own insurance policy

“When you have an accident, you just did the very thing the insurance company hopes never happens. So, you’re now a higher risk client in that pool of other clients — you’re going to pay more now for the insurance company to keep taking on your risk,” says Rudi Pino, founder and CEO of LUNA Insurance. 

Since a previous accident often impacts rates, leaving out this key detail disadvantages the insurance company. Furthermore, omitting this information is a material misrepresentation – a failure to disclose information that could lead the insurer to make a different decision about whether to insure you – and could have ramifications like policy cancellation and claims denials.

What insurers can see about your past

In most states, car insurance companies can look at your Motor Vehicle Report (MVR) to see past traffic violations, including previous accidents. 

“Your updated MVR (Motor Vehicle Report) shows this accident to insurance companies when they quote you and your rate score increases – the company looks at your risk profile, sees that you have an accident and therefore more risky of a driver to insure, so, you have to pay more if you want them to take on your risk,” Pino says. 

While previous accidents tend to fall off your driving record after several years, insurance companies can see any that remain on your MVR. 

Real world example: Teen driver on a parent’s policy

One Reddit user, qtipheadosaurus, shared the following real-life car insurance situation involving their accident-prone teenager. 

“I have a daughter (19F) who is covered under my insurance. She has had two accidents in two years, totalling 34K. Instead of raising our premiums, State Farm dropped me due to her high risk. The fact that we have Kia/Hyundais may have played a factor as well.

I was able to get insured through Geico, but it (cost) 1K more.

She is a full-time student. During winter break, we haven’t let her drive. But she will need to drive in the summer for her job when she is home from college.

Is it possible for her to get her own insurance even though her official address is my home? And secondly, if she gets her own insurance AND we put the car in her name, does it eliminate lawsuit liability for me if she gets into another accident?”

One Reddit user chimed in on this situation, “I help State Farm agents with this all the time. You will have to exclude her from coverage on your primary policy, so she can’t drive any of the family vehicles. Then you write a standalone policy for her and her vehicle with a separate company. No need to exclude you and (your) significant other from her policy, it will only help. This will likely require that you put her vehicle that she operates in her name.

This won’t likely save you money, but it will insulate you from her liabilities. That is kind of the double edged sword of this…you will pay more for her car insurance, but she is the sole named insured so losses on her policy are her own.”

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What happens if you don’t disclose the accident?

If you had an accident and didn’t disclose that information to your new insurer, who finds out about it, several things could happen.

The insurance provider may recalculate your rates and notify you to pay an additional premium to keep your policy in force. Or you could receive a cancellation notice if the new information means you wouldn’t have been approved for coverage if the insurance company had known about it. The company could also deny your claims.

Giving correct information when shopping for car insurance is essential because car insurance companies want a complete picture of what type of risk you and your vehicle represent.

When you might not need to disclose

If the accident happened so long ago that it’s no longer on your driving record, you might not need to disclose this information to a potential insurance company. 

For example, if you were involved in a minor no-fault accident without any injuries involved 20 years ago, it’s likely not on your state’s driving history records anymore. 

How to check what’s on your record before applying for insurance

Insurance companies often check your state’s motor vehicle record (MVR) to determine your driving experience before finalizing your policy. This report can include information about previous traffic violations, any driving restrictions and traffic school courses that you’ve completed. 

Typically, you can get a copy of this report through your state’s Department of Motor Vehicles. Some states charge a fee for this service. However, others provide free access to this report. 

Tips for getting affordable insurance after a claim

After you get into an accident, using the following strategies can help you tap into more affordable insurance:

  • Shop around: Every insurance company has a different method of determining rates. Comparing quotes across multiple insurers can help you find the cheapest rates for your situation. 
  • Commit to safe driving: Going forward, stick to safe driving habits. Consider signing up for a telematics program to track your good driving behaviors in exchange for a potential discount. 
  • Raise your deductible: Choosing a policy with a higher deductible often leads to lower insurance costs. 

Frequently ask questions

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What if my parents handled everything and I don’t know the details?

If you were a driver in an at-fault accident, you must share this information with the insurance company. Likely, you won’t need to provide any additional details. But if the insurer asks for more information, ask your parents to share what they remember about the incident. 

Will my rates be sky-high because of a claim from my parents’ policy?

If you were a driver in an at-fault accident, you’ll likely experience higher insurance premiums. If your parents made a claim to their policy about an accident that didn’t involve you as a driver, you likely won’t see sky-high premiums. 

How long do accidents stay on your record?

The length of time accidents stay on your record varies from state to state. But, in general, at-fault accidents will remain on your driving record for at least three to five years.

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author-img Sarah Sharkey Contributing Researcher
Sarah Sharkey is a personal finance writer with a master’s degree in management from the Hough School of Business at the University of Florida. She enjoys helping readers find money solutions that work. She has written for numerous personal finance publications including Money Under 30 and The College Investor.
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Laura Longero is an insurance expert with more than 15 years of experience educating people about personal finance topics and helping consumers navigate the complexities of auto insurance. She writes and edits for QuinStreet’s CarInsurance.com, Insurance.com and Insure.com. Prior to joining QuinStreet, she worked as a reporter and editor at the USA Today Network.