Auto Insurance Claims: Old Claims, New Problems?

Whether you can submit an old auto insurance claim depends on a few factors, including the nature of the accident, the extent of damage or injuries, and the laws of your state. Generally, it is recommended to notify your insurance company as soon as possible after an accident, as failing to do so could result in serious consequences. Some states have specific time limits for filing injury claims, which is usually around 30 days. It's important to review your auto insurance policy and understand the claims process, as well as your rights and responsibilities when filing a claim.

You can switch insurance companies during a claim but you'll still need to work with your previous insurer to settle the claim

You can switch insurance companies at any time, even during a claim. However, it is important to note that switching insurance will not impact your current claim. You will still need to work with your previous insurer to settle the claim. Your previous coverage will still apply to any damage that occurred when that policy was active.

Your new insurance policy will not apply to an old claim. Your new policy limits, deductibles, and coverages will not apply to an accident that happened before the new policy was in place. Your new insurer will also not take over the handling of your old claim. Therefore, it is crucial to settle all open claims with your previous insurer before switching to a new insurance company.

If you switch insurance companies before filing a claim, your claim may be denied by your new insurance company if the damage occurred outside of the policy period. Switching insurance companies does not invalidate the coverage you had under a previous policy, and you can still report a claim for damage that occurred within the policy period to your old insurer.

It is recommended to notify your insurer of a claim as soon as possible after an accident. While you can switch insurance companies at any time, there are a few things to consider before making the switch. You may be charged a cancellation fee by your current insurer, and you may lose certain discounts and perks offered by your current insurer. Additionally, insurers often share information about claims and accidents, so switching insurance companies after an accident may not necessarily result in a lower rate.

You should report a collision as soon as it happens to ensure you receive full coverage

It's important to report a collision to your insurance company as soon as possible. Many US states require you to report an accident within a certain timeframe, with some, like California, mandating a report within 10 days. In Ontario, Canada, you should report any accident within 24 hours of its occurrence.

There are several reasons why you should report a collision as soon as it happens:

• To comply with the law: In many places, it is mandatory to report a collision within a certain timeframe. Failure to do so can result in criminal prosecution, fines, imprisonment, license suspension, and other legal consequences.
• To receive full coverage: Reporting the collision promptly ensures that you are suitably insured in case of a claim. Failing to report an accident may make you ineligible for coverage when you make a claim.
• To protect yourself from false claims: Reporting the accident and filing a police report creates a record of the incident, which can help protect you from false claims made by other parties involved in the collision.
• To document the incident properly: Reporting the collision to the police and insurance company allows for proper documentation of the incident, including details such as the time, location, weather conditions, vehicle damage, and personal injuries. This documentation can be crucial for insurance claims and legal proceedings.
• To avoid increased premiums: While reporting a collision may result in increased insurance premiums, delaying or failing to report an accident can also lead to higher premiums. Insurance companies review your claim history and driving record to determine your rates, so it is essential to report any accidents promptly and accurately.
• To seek legal assistance: If you have sustained injuries or property damage due to someone else's negligence, seeking legal assistance as soon as possible is crucial. An accident lawyer can help protect your rights and guide you through the process of filing a personal injury claim, which often has a time limit for submission.

If you have collision coverage, it could pay to repair or replace your vehicle no matter who was at fault

Collision coverage is an optional type of insurance that covers the costs of repairing or replacing your vehicle if it is damaged in an accident, regardless of who is at fault. This includes accidents involving another vehicle, as well as collisions with stationary objects such as a tree, fence, or guardrail. It also covers collisions that occur while your vehicle is parked, including hit-and-runs.

While collision coverage is not legally required in any state, it can provide valuable protection in the event of an accident. If you are at fault in an accident, your collision coverage will pay for the repairs or replacement of your vehicle, minus any deductible. If the other driver is at fault, their liability coverage will typically pay for the damage to your vehicle, and your collision coverage can pay for any remaining bills.

It is important to note that collision coverage has some limitations. It does not cover damage caused by animals, weather, or other environmental factors unrelated to auto accidents. It also does not cover medical expenses or damage to another person's property. Additionally, if you make a claim under your collision coverage, you may have to pay a deductible, and your options will depend on your coverage limits.

When deciding whether to purchase collision coverage, consider the value of your vehicle, your ability to pay for repairs or a replacement out of pocket, and whether your vehicle will be in storage for an extended period. Collision coverage is often recommended for newer or more expensive vehicles, as the annual premium is typically less than 10% of the car's value.

You should still notify your insurance company of an accident, even if you don't plan to file a claim

Even if you don't plan to file a claim, it is generally advisable to notify your insurance company of an accident. This is because there are several advantages to reporting an accident to your insurance company, even if you don't plan to file a claim.

Firstly, timely assistance is provided. Your insurance company can help you promptly with repairs or other necessary assistance, ensuring your safety and addressing vehicle issues promptly. This can help you get your car repaired faster and get back on the road more quickly.

Secondly, reporting an accident gives you access to your insurance coverage. By reporting the accident, you can access benefits such as medical expense coverage, property damage coverage, and other costs related to the incident. This can include coverage for medical treatments and out-of-pocket costs associated with the accident.

Thirdly, filing a claim with your own insurer can streamline the claims process, making it more efficient and reducing potential delays. This is because your insurance company may pursue reimbursement from the at-fault party's insurance on your behalf, sparing you the hassle of dealing directly with the other party's insurer.

Finally, reporting the accident to your insurance company provides peace of mind, knowing that you have taken the necessary steps to address the situation and protect your interests. This can include legal protection and assistance with third-party claims.

In addition, failing to notify your insurance company of an accident may result in penalties such as a rate increase or cancellation of coverage. Therefore, it is always a good idea to report any collision, no matter how minor, to your insurance company. This ensures that you are covered in case of injuries or damage that may develop or be discovered later.

If you have only minor damage to your vehicle, a claim might not be necessary

If you've only sustained minor damage to your vehicle, it might not be necessary to file an auto insurance claim. This is because doing so could increase your insurance rates. A 2017 study found that a $2,000 claim can result in a 44% rate increase. Filing a second claim within a year could see your rate jump by 99%.

If you have collision coverage, it will pay for damage to your car. But if you back into a pole, for example, you might consider paying for the repairs yourself or just living with the damage, rather than filing a claim on your collision insurance. If the repair costs less than your deductible, there's no point in filing a claim. The deductible is the amount you pay out of pocket toward a repair.

If the repair costs for your car are more than your collision deductible, you'll have to weigh whether the insurance payout is worth the risk of a rate increase later. Whether your insurance rates will go up after a claim depends on your previous claims history, your insurance company rules, and even your state, which may regulate the circumstances under which insurers can add a surcharge to your rate.

If you have an older vehicle and aren't worried about its cosmetic appeal, it might be worth skipping a claim. If you don't care what your car looks like, just as long as it gets you from A to B and passes inspection, you could save money by leaving that dent in the fender.

It's also worth noting that you should always file a police report after an accident, even if the damage is minor. This will help protect you from false claims later.

Frequently asked questions