Calculator
Enter your premium, towing patterns, and claim timing. After submitting, results appear above this form.
Example data table
Sample configurations and typical outputs. These are illustrative only.
| Premium | Incidents/yr | Tow cost | Claim years | Reimb % | Limit | Surcharge | Discount loss | Horizon | Likely cheaper path |
|---|---|---|---|---|---|---|---|---|---|
| USD 1,200 | 1.0 | USD 180 | 1 | 100% | USD 250 | 10% | 0% | 5 | Often self-pay |
| USD 900 | 2.0 | USD 220 | 1,3 | 80% | USD 150 | 15% | 5% | 5 | Depends on drift |
Formula used
- Baseline premium in year i: Base × (1 + baseline%)^(i − 1)
- Active claim count: number of claim windows covering year i
- Effective surcharge: surcharge% × active claims (or max), reduced by forgiveness%
- Discount loss: full while active, then linearly tapers over recovery years
- Claim premium: Baseline × (1 + effective surcharge) × (1 + discount loss)
- Claimed tow out-of-pocket: max(0, tow − min(tow × reimb%, limit)) + deductible × (1 − waived%) + fees
- Annual totals: Premium + towing cost for that year
- Cumulative NPV delta: sum of (delta / (1 + discount rate)^(year − 1))
How to use this calculator
- Set your current annual premium and towing cost.
- Enter incidents per year for typical usage.
- Type claim years like
1,3. - Adjust reimbursement, limits, deductible, and fees.
- Set surcharge, discount loss, and impact duration.
- Pick baseline change and an optional discount rate.
- Calculate and review charts, totals, and exports.
Claim frequency and renewal behavior
Insurers often treat roadside towing as a low‑severity claim, yet it can still influence renewal pricing through claims frequency rules. This calculator separates immediate cash impact from long‑run premium drift, so you can quantify the total cost of filing versus paying yourself. Use it when a tow feels “small” but you want clarity before reporting the incident. Pair the results with your insurer’s rules and your risk tolerance to choose a reporting strategy for towing events.
Premium path modeling across claim windows
The model projects a baseline premium path using an annual change rate you choose. For each claim year you enter, it applies a surcharge and any discount loss for a defined duration, with optional stacking when multiple claims overlap. A forgiveness factor can reduce the expected surcharge impact, helping you test “best case” and “worst case” outcomes without changing the core inputs.
Out‑of‑pocket towing cashflow mechanics
Cashflow matters as much as premium. The tool estimates your net out‑of‑pocket per claimed incident using reimbursement percentage, per‑incident coverage limits, deductible, deductible waiver percentage, and fees. If you experience more than one incident per year, unclaimed incidents remain self‑paid while one incident in each claim year follows claim rules. This mirrors mixed behavior many drivers follow in practice.
Timing, stacking, and recovery assumptions
Because timing changes outcomes, the calculator lets you start premium effects in the same policy year or at the next renewal. Discount recovery can taper the discount loss after the impact window ends, reflecting carriers that gradually restore claims‑free credits. Stacking mode lets you compare additive penalties to a capped approach, which is useful when policies limit how many surcharges apply at once.
Interpreting totals, cumulative, and NPV outputs
For decision quality, totals are shown year by year and as cumulative differences, including towing and premium components. If you enter a discount rate, cumulative NPV difference converts future costs into present value, supporting apples‑to‑apples comparison across horizons. Exportable tables make sensitivity checks quick, so you can vary claim years, duration, and limits to see which assumptions drive the decision most.
FAQs
Does a towing claim always raise my premium?
Not always. Some policies treat towing as roadside assistance with minimal rating impact, while others count it as a claim. Use this tool to test scenarios, then confirm your carrier’s rules for your coverage type.
How do multiple claim years work here?
Enter years like 1,3. Each claim creates an impact window for the selected duration. If windows overlap, stacking mode can add surcharges or cap them at a single surcharge.
What does reimbursement percent and limit mean?
Reimbursement percent is the share of the tow bill covered. The limit caps the reimbursed amount per incident. Net out‑of‑pocket equals tow cost minus reimbursed amount, plus deductible and fees.
Why is there a discount rate option?
A discount rate converts future differences into present value. It helps compare near‑term savings to later premium increases on the same basis, especially for longer horizons.
What is discount recovery years?
After the impact window ends, discount recovery gradually reduces the discount loss back toward zero. Set it to 0 if your discount immediately returns or if you prefer conservative estimates.
How should I choose the horizon?
Pick the period you expect to keep the policy or vehicle, commonly 3–5 years. Longer horizons capture more premium drift, while shorter horizons emphasize immediate cash costs.