Should you make an insurance claim even for minor damage? What if the other driver was uninsured? Answers to frequently asked questions about dealing with insurance after an accident.
There’s a lot of “conventional wisdom” involved with auto accidents. But what you should do in any given situation will depend upon the specifics of the accident. Are you at fault? Is the other party at fault? Was anyone injured? Was the damage minor or extreme?
Before deciding exactly how to proceed, you first have to assess which of these situations apply in your case. But let’s flesh out a general roadmap for how you should move forward after an accident.
First things first…
There are certain procedures that should be carried out immediately at the scene of the accident, and they’re pretty standard.
Make sure no one was hurt.
This is the human thing to do, no matter who is at fault. If someone is hurt – whether it’s you, the other driver, a passenger in either vehicle, or a pedestrian, call 911 immediately. However, never move a person who has been injured – you could make matters worse. Let medical professionals handle the situation.
DO NOT admit fault to the other driver or to witnesses.
Don’t lie, but don’t say things that could be used against you down the road. That’s for your insurance companies – and the police, if they get involved – to decide.
Don’t get into a shouting match or dispute.
Even if you’re 100 percent sure that the other party is wrong, this is no time to escalate the conflict. The situation will be sorted out by the facts; there should be no need for arguments at the scene of the accident.
Exchange insurance information.
That’s a two-way street, so be prepared to share your information as well. If the other party is not forthcoming, there is a good chance they are uninsured.
Get other important information.
You should always get supplemental information, but even more so if the other party is uninsured. This should include the other driver’s name, address, phone number, driver’s license number, and license plate number. If you can, also record the year, make and model of the vehicle, and even the VIN number if you can get it (it’s usually on a metallic strip on the dashboard, and easily read from outside the car).
Call the police.
If there is any damage to either car, or injuries to any parties, you must call the police. At a minimum, this will be necessary so that a police report will be filed. Not only will that be required by your insurance company, but it’ll be the best record of the events that transpired immediately after the fact. Never trust any of that to memory!
When to tell your insurance company
If the damage is minor and there are no injuries, you and the other driver may decide not to file an insurance claim.
Not reporting an accident can be an advantage even if the repairs are likely to exceed your deductible, since you may be willing to pay a little bit extra in order to avoid having the accident charged against your insurance.
There are risks to this approach however, and they’re not minor. In the event that the repairs end up being significantly more than you anticipate (which is very likely), or if the other party decides to change their story and become uncooperative, not telling your insurance company could turn out to be a disaster.
One hard and fast rule here: Always report the accident to your insurance company if there are injuries, however minor. Someone’s sore neck that they shrug off could turn into five-figure medical bills down the road. These kinds of claims are the primary reason you have auto insurance.
When to get a repair estimate
You should only get an estimate from an auto body shop if you plan to pay for the repairs out of pocket, and not notify your insurance company. But if you plan to file a claim, the estimate will come from your insurance company, and will be worked out between their adjuster and an insurance-company-approved auto body company.
Some insurance companies will allow you to choose the auto body shop, but it will be subject to review and modification by the insurance adjuster. So if you need an estimate, contact your insurance company, and see what their procedure is.
Dealing with the other person’s insurance company
Generally speaking, your contact should be only with your own insurance company. The other party in the accident is responsible for contacting their own insurance company.
Since auto accidents are conflicts by their very nature, it is best to allow the insurance companies to work out the details between each other. They have knowledge of state laws, and attorneys to help them navigate those laws.
At some point in the process, the other party’s insurance company will contact you to get a sworn statement on the event. Your insurance company will similarly contact the other party for the same information.
This is why it’s important to have a police report completed and filed with the police department. It gives you a legally recognized written description of the events surrounding the accident.
Will your rates go up if you were not at fault?
Generally speaking, no. But the laws in each state are different, and there could be certain legal nuances that result in an upward adjustment in your premium.
If you have been involved in several accidents that were not your fault, the company may decide that you are a high risk driver by virtue of the fact that you have been involved in several accidents within the past couple of years. Though you may not be considered legally at fault, there is nonetheless something about your driving patterns that cause you to be involved in an unusual number of accidents.
That may not be the position your insurance company takes, but mine is one of the biggest in the country, so I doubt they are the only ones with this policy. That said, a single accident that is not your fault should not be of any concern.
Should you file a claim if you don’t plan to repair your car?
If the other party is at fault, there’s no benefit to you for not filing a claim, even if you don’t plan to repair the car. However, if the accident is your fault, the debate is more complicated.
If the car is older than 10 years, the damage is minimal, and you don’t mind another dent and a set of scratches, you may not want to file a claim. This is especially true if you are at fault, and filing a claim will result in a higher insurance premium.
More significant damage changes the equation.
If the damage is extensive, but the car is still drivable, not repairing the car could cause it to lose so much of its value that it will have little or no trade-in value when it comes time to buy a new car. Depending on where the numbers fall, it may be better to file a claim even if you are at fault.
If the cost to repair the vehicle is higher than its book value, the insurance company will total the car. That is, they will issue you a payment for no more than the book value of the car, at which point you are free to either repair the car (with an insufficient settlement), or to keep the car and pocket the payment.
Just understand that once the car is totaled, it will no longer be covered by collision and comprehensive. Should you get into another accident, the insurance company will not pay to repair the vehicle.
It’s important to understand that how you handle a car accident has general rules only. What you should do specifically will depend upon who was at fault, the type of accident, the extent of the damage, and what other options you have. Since every accident is different, you should solicit opinions from knowledgeable people, including mechanics and even a lawyer, if necessary. Accidents create legal situations that take all kinds of twists and turns.
As is the case with driving itself, always proceed with caution