For Kentucky drivers, understanding their rights regarding auto insurance can save them significant money and frustration, especially after an accident that wasn’t their fault.
Kentucky’s little-known but powerful consumer protection law specifically addresses when insurance companies cannot raise premiums following an accident.
Kentucky’s Legal Protection for Not-At-Fault Drivers
Kentucky Revised Statute (KRS) 304.20-045 provides critical protection for drivers who are involved in accidents but are not at fault.
The exact language of the statute states:
“An insurer shall not increase the premium on an automobile liability insurance policy solely because the insured, who was not at fault or contributorily negligent, was involved in an automobile accident for which he or she filed a claim under the policy. If an insured believes his or her policy has been surcharged or his or her premium has been increased solely because he or she was involved in an accident for which he or she was not at fault or contributorily negligent and for which he or she filed a claim under his or her policy, the insured may file a written complaint with the commissioner of insurance.”
This consumer protection applies regardless of whether the other party was uninsured or underinsured, making it a powerful shield against unwarranted premium increases.
What makes this protection especially valuable is that it applies to all types of auto insurance claims, including:
Uninsured Motorist Claims
When you’re hit by a driver without insurance coverage, you may need to file an uninsured motorist claim with your own insurance company.
Kentucky law prohibits your insurer from raising your rates solely because you filed this type of claim when the accident wasn’t your fault.
Underinsured Motorist Claims
Similarly, if the at-fault driver has insurance but their coverage limits are insufficient to cover your damages, you may need to file an underinsured motorist claim.
Again, your insurance company cannot penalize you with higher premiums for filing this claim.
Collision Coverage Claims
If you use your collision coverage to repair your vehicle after an accident that was not your fault, your insurance company cannot use this claim to justify raising your premium rates.
Personal Injury Protection (PIP) Claims
Kentucky is a “choice no-fault” state, meaning that regardless of who caused the accident, you may file a Personal Injury Protection (PIP) claim.
This is typically with your own insurance company for medical expenses and lost wages up to certain limits.
Your insurer cannot use your PIP claim to raise your rates if you weren’t at fault for the accident.
Property Damage Claims
Whether the claim involves damage to your vehicle or other property, the protection applies as long as you weren’t at fault for the accident.
Real-World Scenarios
Scenario 1: Hit by an Uninsured Driver
Let’s say you’re stopped at a red light when another driver rear-ends your vehicle. The other driver admits fault but has no insurance.
You file an uninsured motorist claim with your insurance company to cover the repairs to your vehicle and your medical expenses.
Under KRS 304.20-045, your insurance company cannot raise your premium rates simply because you filed this claim, as you were not at fault for the accident.
Scenario 2: Underinsured Motorist Situation
You’re involved in a serious accident caused by another driver who has only the minimum required liability coverage of $25,000 per person for bodily injury. Your claim is worth more than that.
You file an underinsured motorist claim with your own insurance to pay the remaining value of the injury claim.
Kentucky law prohibits your insurer from increasing your premiums based solely on this claim, as you were not at fault.
Scenario 3: Collision Coverage Claim
A distracted driver sideswipes your parked car while you’re shopping. Either he is uninsured, or his insurance company is dragging its feet.
You file a claim using your collision coverage to fix your vehicle rather than waiting for the other driver’s insurance to pay.
Even though you filed a claim with your own insurance first, your rates cannot be increased solely because of this claim.
Scenario 4: PIP Claim Following a Not-At-Fault Accident
You’re injured in an intersection collision where another driver ran a red light.
You file a PIP claim with your own insurance for your immediate medical expenses and lost wages while recovering from your injuries.
Your insurance company cannot use this PIP claim to justify a premium increase since you were not at fault for the accident.
What to Do If Your Rates Increase
If you believe your insurance company has violated KRS 304.20-045 by raising your rates after a not-at-fault accident, you have the right to take action:
Review Your Policy and Premium Notices
Carefully compare your premium before and after the accident to confirm an increase.
Contact Your Insurance Company
Speak with your insurance agent or company representative to inquire about the reason for the rate increase. Specifically reference KRS 304.20-045 and ask for a written explanation.
File a Written Complaint
If your insurer doesn’t resolve the issue, you have the right to file a formal complaint with the Kentucky Department of Insurance. This is mentioned explicitly in the statute as a recourse available to consumers.
How to File a Complaint
You can submit your complaint to the Kentucky Department of Insurance in several ways:
Online: File a complaint through the Kentucky Department of Insurance website
By mail: Print and complete the Consumer Complaint Form and mail it to the Department
By phone: Call the Department’s Consumer Protection Division at 800-595-6053 (for Kentucky residents) or 502-564-6034
The Department of Insurance is required to investigate your complaint and take appropriate action if they determine that the insurer has violated the statute.
Other Factors That Can Legally Affect Your Premiums
It’s important to note that while your rates cannot be raised solely because of a not-at-fault accident claim, other factors can legally impact your premium:
At-fault accidents or moving violations
If you’re determined to be partially or fully at fault for an accident, or if you receive traffic citations, your rates may increase.
General rate increases
Insurance companies periodically adjust rates for all policyholders in a geographic area due to increased claims in that region or other risk factors.
Changes in your driving record unrelated to the accident
If you receive traffic tickets or are involved in other accidents where you are at fault, these can affect your premium.
Changes in your credit rating
In Kentucky, insurers can use credit information as a rating factor, so changes to your credit score might affect your premium.
Frequently Asked Questions
Can my insurance company raise my rates if I was partially at fault for an accident?
If you were determined to be comparatively negligent (partially at fault), the insurance company may have legal grounds to raise your rates.
KRS 304.20-045 specifically protects drivers who were not at fault.
Does this protection apply to commercial auto insurance policies?
Yes, KRS 304.20-045 applies to Kentucky’s automobile liability insurance policies, including personal and commercial auto policies.
How long does the Kentucky Department of Insurance take to investigate a complaint?
When the insurance company receives a complaint from the Department of Insurance, it must respond within two weeks.
Typically, the Department aims to resolve most complaints within 30 days, although complex cases may take longer.
Will filing a complaint against my insurance company cause them to cancel my policy?
No. Kentucky insurance companies are prohibited from retaliating against policyholders for filing good-faith complaints with the Department of Insurance.
Will a not-at-fault accident affect my new rates if I switch insurance companies?
While KRS 304.20-045 prohibits rate increases for not-at-fault accidents with your current insurer, new insurance companies may still consider your claims history when setting initial rates.
However, you can explain that you were not at fault for any claims, and many insurers will consider this.
What if my rates increased for “other reasons” shortly after my not-at-fault claim?
If you suspect the increase is actually related to your not-at-fault claim but the insurer claims it’s for other reasons, document everything and file a complaint with the Kentucky Department of Insurance.
They can investigate whether the timing and justification for the increase are legitimate.
Can I cancel my policy if my rates increase after a not-at-fault accident?
Yes, you can cancel your policy anytime.
Before canceling, shop around for better rates and inform prospective insurers that your claim arose from an accident where you were not at fault.
How Sam Aguiar Injury Lawyers Can Help
Navigating insurance claims and premium disputes can be challenging, especially when recovering from an accident that wasn’t your fault.
At Sam Aguiar Injury Lawyers, we protect Kentucky drivers’ rights and ensure insurance companies comply with state laws like KRS 304.20-045.
When they don’t we look into remedies for bad faith and consumer protection violations.
Our experienced attorneys can:
Handle personal injury claims related to your accident
Review your insurance policy and premium changes to identify potential violations
Communicate with your insurance company on your behalf
Help you prepare and file a complaint with the Kentucky Department of Insurance
Represent you if further legal action becomes necessary
Don’t let insurance companies unfairly increase your premiums.
If you’ve been involved in a not-at-fault accident and believe your rates were illegally raised, contact us today for a free consultation.
Call our Louisville office at 502-888-8888 or our Lexington office at 859-888-8000.
Visit us at one of our convenient locations:
Louisville: 1900 Plantside Drive
Lexington: 620 W. Main Street
