Does a no-fault accident increase insurance rates?

9 minute read Published on Apr 26, 2024 by BrokerLink Communications

Two drivers making phone call after traffic accident where a car hit another one from behind

Many drivers wonder if having an accident where nobody is blamed, also known as a no-fault accident, will make their insurance costs go up. The name no-fault sounds like it shouldn’t affect your insurance since nobody was to blame , but how insurance companies decide on prices isn’t that simple. In this blog, we’re going to look closely at what no-fault accidents really are, how they’re dealt with in Canada, and how they might change what you pay for car insurance.

Do insurance rates increase after a no-fault accident?

Whether your car insurance costs will go up after an accident where no one is blamed (no-fault) depends on a few things, like your insurance company’s rules and where you live in Canada. Car insurance works differently in each province, with some using a no-fault system, others using a system where someone is blamed (tort system), and some mixing both.

No-fault insurance system

In places with no-fault insurance, like Quebec, Ontario, Alberta, and more, you deal with your own insurance provider for accident claims, no matter who caused the accident. This is supposed to make getting money for claims faster and easier.

But, even in these no-fault places like Ontario, having an accident can still make your insurance go up. Insurance companies look at your driving record, how many times you’ve made claims, and other stuff to decide if you’re more likely to need money from them again. If they think you’re a higher risk because of the no-fault accident, they might charge you more.

No-fault accident meaning

No-fault just means how claims are handled, not that no one is blamed for the accident. Insurance companies can still decide someone is at fault based on what happened in the accident according to a set of fault determination rules. If they decide you’re at fault, your insurance might cost more.

What exactly is a no-fault car accident?

If you’re involved in a car accident and have no-fault insurance, it means you and the other people in the accident ask your own auto insurance provider to pay for any damages or injuries, no matter who caused the accident. This no-fault car insurance system is there to make sure people get money for their accidents quickly without having to figure out who was at fault first. It helps people get paid faster for things like medical bills and avoids a lot of arguing in court.

But, even though it’s called no-fault, the insurance companies still look at what happened in the accident to determine fault. Who they decide was at fault can affect how much you pay for insurance in the future and whether they think you’re a risky driver. No-fault insurance helps cover your losses, but the rules about how much money you can get and when you might be allowed to take someone to court if the accident was terrible can differ depending on where you are.

How is who’s at fault determined in a car accident?

Insurance companies use rules to determine who caused a car accident. When it comes to car insurance, there are two kinds of accidents: no-fault, where you didn’t cause the crash, and at-fault, where the cause of the accident was your fault. To decide who’s to blame and which insurance provider needs to pay for damages, they look at different things:

Gathering proof

Right after an accident, everyone involved, including the police and insurance companies, starts collecting proof of what happened. This could be what drivers and witnesses say, photos of where the accident happened, videos, and the police report, which is really important because it’s a neutral look at the crash.

Traffic laws

The insurance company checks the traffic rules to see if anyone broke them, like speeding or running a red light. If you break a rule, there’s a good chance you’ll be determined at fault.

Fault determination rules

Specific rules help decide who’s at fault in different situations, like if someone hits someone else from behind or during a left turn. These rules make it more apparent who’s to blame.

Insurance company rules

Each car insurance company has its own way of deciding who’s at fault based on the info and evidence. There might be slight differences in how each company makes its decisions.

When both drivers are a bit at fault

Sometimes, both drivers share some of the blame. How much each person is at fault is figured out; one might be 70% at fault, and the other 30% will affect how much money each person’s insurance will pay.

This whole process can get pretty complicated, and sometimes people don’t agree on who was at fault. When that happens, it might even end up in court, where a judge decides based on all the evidence.

How long does an accident stay on your driving record?

Accidents can show up on your driving record for 6 to 10 years, but in Canada, how long they stay on your record depends on where you live and what kind of accident it was, if it was your fault or not. Different places in Canada have their own rules about driving records and insurance.

If you cause an accident and are determined to be at fault, it usually stays on your record for six years, depending on where in Canada you live, but it can go up to 10 years. Insurance companies look at this to figure out if you’re likely to get into accidents and how much to charge you for insurance. For accidents that aren’t your fault, it’s a bit different. The accident might still be on your record, but it doesn’t always affect your insurance the same way. This can change based on what your insurance company decides and the rules in your province.

How much can car insurance rates increase after an accident?

Some people might see a small jump in their auto insurance rates, while others could get hit with a big increase after reporting a car accident to their insurance company. In Canada, if you’re in an accident where you’re not at fault, how much your car insurance premiums go up can depend on a lot of things like the details of the accident, your past insurance claims, where you live, and your insurance company’s own rules. It’s a good idea to talk directly to your insurance company to get the best idea of how much more you might have to pay since they can give you info that fits your specific situation.

What if I don’t tell my insurance company about a collision?

If you get into a car crash and don’t tell your insurance company, it could cause big problems. Most of the time, your insurance says you have to report accidents quickly. If you don’t, you might not be covered for future accidents, your insurance could be cancelled, or it might be harder to get insurance later. If the other person in the crash decides to ask for money or sues you, you could end up paying a lot for damages or legal costs that your insurance might have covered.

Also, if the other person tells their insurance or sues you, your insurance will find out about the crash anyway. Waiting too long to tell them can mess up the process of sorting out claims and might still lead to your rates going up, losing discounts for not having claims before, and other bad stuff you wanted to avoid. So, it’s really important to tell your insurance about any crash so you follow the rules of your policy and keep your insurance support when you really need it.

How does an at-fault accident affect insurance?

From increased auto insurance premiums to loss of discounts to the potential of a policy non-renewal or cancellation, an at-fault car accident can significantly affect your car insurance in several ways:

Your insurance might cost more

Insurance companies will likely charge you more after an at-fault accident because they see you as a bigger risk. How much more you’ll pay depends on how bad the at-fault accident was, what the insurance company’s rules are, and your past driving record. They usually keep an eye on at-fault accidents for about six to ten years.

It could be harder to find cheap insurance

After an accident you caused, some insurance companies might think you’re too risky and not want to insure you. You might have to get insurance from a place that covers high-risk drivers, which can cost a lot more.

Your insurance policy might change

After an at-fault accident, your insurance company might make you pay a higher deductible than the amount you pay before insurance kicks in or give you less coverage than before.

You might lose discounts

If you were getting a discount for being a good driver or not having claims, you might lose that and have to pay more.

Your insurance might not renew your policy, or they might cancel it

If you’ve caused a few accidents, your insurance company might decide not to continue your policy or cancel it. Then, getting new insurance could be hard and expensive.

Can I prevent my insurance rates from going up after an accident?

Yes, but trying to keep your car insurance rates from going up after an accident, especially if you were at fault, can be tough. But there are a few things you might do to help or even avoid a hike in your rates in some situations:

Accident forgiveness

Some insurance companies have a policy called accident forgiveness, where they won’t raise your car insurance rates for your first at-fault accident. This could be already part of your car insurance or something you can add on. Whether you can get this depends on the insurance company and your driving record. This coverage must be on your policy prior to the incident; you cannot add it after the fact to use for a previous incident.

Safe driving record

If you’ve been a safe driver for a long time, that’s good. Insurance companies look at your entire driving history when they think about changing your rates. A good driving record might help keep any increases lower.

Shop around

If your rates do go up, it might be a good idea to see what other insurance companies offer. Different companies might give you a better deal based on how they figure out risk.

Pay for small stuff yourself

If the at-fault accident only caused a little bit of damage, it might be smarter to just pay for the repairs yourself, especially if the cost is near your deductible. This way, you don’t have to make a claim for an at-fault accident that could raise your rates.


Even if an accident where no one is blamed (a no-fault accident) doesn’t directly make your car insurance cost more, it can still affect your wallet in other ways. Insurance companies look at more than just who is at fault. They consider how serious the accident was and how often you have accidents. Also, doing things ahead of time, like getting accident forgiveness added to your policy, can help keep your rates from going up after your first accident. It’s really important for drivers to know what their insurance covers, to drive safely, and to check their insurance policies now and then to make sure they still fit their needs.

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How does insurance work when you are not at fault?

When you’re not at fault, your insurance typically covers the damages through the other party’s liability coverage. Your insurer may assist in the claims process and handle negotiations with the at-fault party’s insurance company.

How much will my insurance go up with a no-fault accident in Ontario?

The impact on your insurance rates after a no-fault accident in Ontario varies. Generally, rates may not increase directly due to a no-fault accident, but other factors, such as the severity of the accident and your claims history, can influence any rate adjustments.

Is no-fault insurance good or bad?

No-fault insurance can be beneficial as it ensures prompt coverage for your injuries and damages regardless of fault, reducing the need for lengthy legal battles. However, it can also limit your ability to sue for additional damages, which some may view as a downside.

How long does a car accident stay on your record in Ontario?

In Ontario, a car accident typically stays on your driving record for six years from the date of the accident. However, its impact on your insurance rates may diminish over time, especially if you maintain a clean driving record thereafter.

If you have any questions, contact one of our local branches.