If you've ever explored the world of auto insurance rate factors, you probably noticed there are quite a few. Some even come with multiple factors of their own, which makes it really easy to play the game of "well if X affects my rate, what about Y…?" Sometimes Google gives you a clear answer and sometimes you "what if" your way five pages deep into a search engine with nothing to show for your efforts.
Well, we'd like to save you from the latter by explaining some potential scenarios one post at a time. For this edition, we're going with "does getting my car towed affect my premium?"
Short answer: Not directly.
Longer (but not too long, so read it) answer:
Outside of an accident, we can probably group the reasons your vehicle would get towed into two main categories: It broke down or you did something illegal.
Let's explore each possibility.
Your car broke down and you need a tow.
If you're paying for the tow yourself, chances are your insurance company won’t be informed that your car had issues. Nowadays more people are using their insurance companies for roadside assistance since a lot of them offer the coverage at no- or low-cost. (At Say, it's included in every policy for free). In that case, the insurance company will have to be notified, leaving drivers to question, "if claims can raise my rate, does using my roadside assistance count as a claim?"
Technically speaking, any time you need your coverage to kick in, it's considered a claim—but not all claims raise rates. We can't speak for every insurance company, but for most, using roadside assistance coverage does not lead to an increase in your rate. Instead, the insurance company will take note of when and how often you use the services. If you start using the service way more than average, the company may increase the risk they associate with you (which could increase your rate) or refuse to renew your policy. At Say, we will never rate up for a towing claim, but if a driver is found to be abusing the service, we will not renew the policy.
Final answer: abusing roadside assistance, or using it too often, could affect your rate, but the tow itself would not.
You did something illegal.
Now this one can sound a bit dramatic, but the spectrum of "illegalness" can vary from a simple mistake to a flat out no-no. Here are some of the illegal actions that lead to a car being towed and impounded:
- Parking in a Tow Zone (obvious)
- Unpaid parking tickets
- Parking next to a fire hydrant
- Blocking traffic
- Blocking access to a handicap ramp
- Driving with a suspended license
- Being unlicensed
- Expired registration
- Driving while intoxicated or under the influence of drugs
- Driving with illegal drugs, firearms or fireworks
- Reckless driving, drag racing or interfering with a funeral procession
- Fleeing from police
- Soliciting prostitutes or drugs
Looking at that list, you can see some of these things affect your insurance premium regardless of towing. Consider parking tickets. Since they're not considered a moving violation, getting one does not affect your rate. Having unpaid parking tickets does, however, because your financial habits play into your insurance score and rate. Not only that, but unpaid tickets can lead to a license suspension.
Driving without or with a suspended license, driving under the influence, reckless driving, fleeing from the police, etc. automatically indicates risky driving behavior, which can lead to a premium increase, but again, the tow itself does not.
Also, if your car gets impounded, you'll need to pay for the towing and storage fees, which can add up quickly. Not being able to pay will go on your financial record, which as we've mentioned before, affects your rate.
Posted April 6, 2017 in insurance know-how.