Can Insurance Companies Raise Your Rates After a Not-At-Fault Accident in Kentucky?
Kentucky law protects drivers from premium surcharges after accidents that aren’t their fault. Here’s exactly what the statute says, where it applies, and what you can do when an insurer violates it.
Under KRS 304.20-045, Kentucky insurance companies are prohibited from raising your auto insurance premium solely because you filed a claim for an accident that was not your fault. The statute applies to personal and commercial auto policies and covers uninsured motorist claims, underinsured motorist claims, collision claims, and PIP claims — provided the insured was not at fault. If your insurer has raised your rates after a not-at-fault accident, that’s a violation you can challenge with the Kentucky Department of Insurance.
The Kentucky Statute — What KRS 304.20-045 Actually Says
The statute is direct: an insurer may not impose a surcharge or increase in premium on an automobile insurance policy because of a claim for uninsured motorist benefits, underinsured motorist benefits, collision benefits, or personal injury protection benefits when the insured is not at fault for the accident giving rise to the claim.
The prohibition applies regardless of which coverage type you used — and it applies whether you were rear-ended in Louisville, hit by an uninsured driver in Lexington, or had your parked car struck while you were away. The key is fault. If you did not cause the accident, the claim cannot be used to justify a premium increase under Kentucky law.
Which Claims Are Protected Under KRS 304.20-045?
- Uninsured motorist (UM) claims — filing a UM claim because the at-fault driver had no insurance cannot trigger a rate increase
- Underinsured motorist (UIM) claims — filing a UIM claim because the at-fault driver’s coverage was insufficient cannot trigger a rate increase
- Collision claims — filing a collision claim for damage caused by another driver cannot trigger a rate increase when you’re not at fault
- Personal Injury Protection (PIP) claims — filing a PIP claim for medical costs in Kentucky’s choice no-fault system cannot trigger a rate increase when you’re not at fault
The protection applies to both personal and commercial auto policies in Kentucky.
Real-World Scenarios — When the Protection Applies
Uninsured Driver Rear-Ends You at a Stop Light
You file a UM claim with your own insurer to cover your injuries and vehicle damage. Because you were not at fault, KRS 304.20-045 prohibits your insurer from raising your premium because of that UM claim filing.
At-Fault Driver Carries Insufficient Coverage
The driver who hit you has only the state minimum ($25,000 per person). Your medical bills exceed that amount. You file a UIM claim with your own insurer to cover the gap. The insurer cannot surcharge your policy because you filed that UIM claim.
Your Parked Car Is Struck
Someone backs into your parked vehicle and doesn’t leave a note. You file a collision claim. Because you had zero involvement in causing the accident, any premium increase based solely on that claim would violate KRS 304.20-045.
You Use PIP After an Intersection Crash You Didn’t Cause
A driver runs a red light and hits your vehicle. You file a PIP claim with your insurer for immediate medical coverage. That PIP claim — because you were not at fault — cannot be used to justify a premium increase.
What Insurance Companies CAN Legally Do to Your Rates
The statute protects you from surcharges related to not-at-fault claims. But there are circumstances where rate changes are legally permissible. Understanding the difference is critical:
- At-fault accidents — if you caused the accident, the insurer may adjust your rates based on that at-fault claim. KRS 304.20-045 does not protect at-fault drivers.
- Broad portfolio-wide rate increases — insurers may raise rates across their entire book of business based on overall loss experience, inflation, or market factors. These general increases are not surcharges triggered by your specific claim.
- Driving record changes — new moving violations on your record can affect your premium separately from any accident claim.
- Credit score changes — Kentucky permits insurers to use credit-based insurance scores as a rating factor under KRS 304.20-040. A decline in credit score can affect your premium independently of any accident claim.
Switching Insurers After a Not-At-Fault Claim
Here’s an important nuance: the protection in KRS 304.20-045 applies to your current insurer. A new insurance company reviewing your claims history when you apply for a new policy may ask about prior claims — and different insurers evaluate that history differently. Some companies may factor in not-at-fault claims when initially pricing a new policy, even when your existing insurer cannot surcharge you. If you’re shopping for new coverage after a not-at-fault accident, disclose your claim history accurately and compare quotes across multiple carriers.
How to Challenge an Illegal Rate Increase
If you believe your insurer raised your premium in violation of KRS 304.20-045, here are your options:
- Review your policy and the renewal notice — identify whether the increase is itemized as a surcharge related to a specific claim or as a general portfolio adjustment. Ask your insurer in writing to explain the basis for any premium increase.
- File a written complaint with the Kentucky Department of Insurance — the Kentucky DOI investigates complaints against insurers. You can file online, by mail, or by phone at 800-595-6053. The insurer is required to respond to the DOI’s inquiry within approximately two weeks, and the investigation typically concludes within 30 days.
- Consult with an attorney — if the insurer has raised your rates in connection with a larger claim dispute or a bad faith situation, Kentucky’s bad faith law may support additional remedies. Our team handles the full picture of insurance disputes — learn more about how insurers approach claims and your rights.
Note on “accident forgiveness” clauses: Some policies advertise “accident forgiveness” as a benefit — promising no rate increase after your first accident. Read the fine print. These clauses typically apply to one at-fault accident, and they may have eligibility requirements or premium add-ons. KRS 304.20-045 provides broader protection that applies to any not-at-fault claim — regardless of whether you’ve purchased an accident forgiveness endorsement.
Frequently Asked Questions
What if I was partially at fault for the accident?
KRS 304.20-045 protects you only when you are not at fault. If you bear any portion of fault for the accident, the insurer may have grounds to consider that in its rate calculations. However, fault determinations are not always straightforward — the insurer’s own assessment of fault is not final, and disputed fault situations can be challenged. If you believe the fault determination is incorrect, consult with an attorney before accepting any rate increase as final.
Does this protection apply to commercial vehicle policies?
Yes. KRS 304.20-045 applies to both personal and commercial automobile insurance policies in Kentucky. If your business vehicle was in a not-at-fault accident and your commercial auto insurer has raised your rates based on that claim, the same complaint process and legal protections apply.
Can I file a complaint with the Kentucky DOI without a lawyer?
Yes. The Kentucky Department of Insurance complaint process is designed for direct consumer use. You can file online at doi.ky.gov, by mail to 500 Mero Street, Frankfort, KY 40601, or by calling 800-595-6053. The DOI requires the insurer to respond within approximately two weeks and typically concludes investigations within 30 days. An attorney is not required for the complaint process, but one may be valuable if the dispute involves a larger claim or bad faith conduct.
My insurer raised my rates after my UM claim. Is that illegal?
Yes — if you were not at fault for the underlying accident. KRS 304.20-045 explicitly protects UM and UIM claimants from premium surcharges when the insured is not at fault. File a written inquiry with your insurer asking for the specific reason for the increase. If they confirm it’s related to your UM claim, file a complaint with the Kentucky Department of Insurance.
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