Does using roadside assistance increase insurance rates?
Some car insurance companies report roadside assistance claims to ChoicePoint, a company in Alpharetta, Ga., that collects claims information for the auto insurance industry.
When you have multiple claims, this information can go to ChoicePoint and may eventually be viewed by other auto insurers. But does roadside assistance count as a claim, and can it affect rates?
Roadside assistance claims are considered claims, but state rules vary in terms of whether – and how – your provider is allowed to penalize you for making an insurance claim, Bach says. Multiple roadside assistance claims in a short period could cause some insurance companies to raise your rates, she says.
"When you file claims, insurance companies look at their frequency, severity and who's at fault," Bach says.
Roadside assistance claims usually aren't severe. But if they're frequent, it tells your insurance company that your car isn't in great shape.
Can your car insurance be canceled because of roadside assistance claims?
Will you lose coverage for excessive roadside claims? Bach says it's difficult to know because insurers combine claims information with many other factors when deciding who to cover and at what rates. Such factors include the driver's age, sex, city, vehicle and credit history.
To be safe, contact your insurance agent or representative to fask whether multiple roadside assistance claims could affect your rates or coverage.
Although car insurance companies don't penalize drivers for making multiple claims, Bach says many policyholders may fear using their roadside assistance services.
"Many people believe it's best to fly under their insurance company's radar by not filing a claim," she says.
However, paying for coverage but not using it doesn't make financial sense, Bach says.
Limitations of car insurance with roadside assistance
Roadside assistance plans from auto insurance companies often cover the vehicle instead of the driver. So, drivers with this type of coverage can't call their insurance company for roadside help if they are driving a friend's vehicle and it breaks down.
By contrast, assistance plans from organizations such as AAA cover the member who belongs to the program. That means members can call for assistance no matter which vehicle they're traveling in.
For example, how does roadside assistance work if your teenage child is a passenger in a car driven by someone else and the car has a flat tire? Your auto insurance roadside assistance likely won't help, but a motor club membership would.
"If your teenager is covered under a roadside assistance plan that follows the customer, instead of the car, then your teen could still get roadside assistance help, even though the vehicle does not belong to them," says Christie Hyde, an AAA spokesperson.
Additionally, claims with a motor club will not affect your car insurance rates.
That said, roadside assistance costs less with car insurance, often only a few dollars over a six-month term. For most drivers, it's a worthwhile addition.
