Should You Make An Auto Insurance Claim?

Whether or not to make an auto insurance claim is a tricky question. On the one hand, you don't want your insurance rates to increase as a result of a car accident. On the other hand, if you choose to pay for another driver's auto repair costs out of pocket instead of filing a claim with your insurer, you could expose yourself to trouble. So, when is it right to make a claim? The answer depends on a few factors, including the extent of the damage, whether there are any injuries, and the cost of repairs relative to your deductible.

If you're in a minor accident that leaves little damage to either car and no injuries, you may not want to file a claim since it could increase your premium. However, it can be challenging to reach an agreement with a stranger, and you may find it easier to simply contact your insurer. If you have collision coverage, it will pay for damage to your car, but if the cost of repairs is less than your deductible, there may be no point in filing a claim.

On the other hand, if you're in an accident with significant damage or injuries, it's generally a good idea to file a claim. This is especially true if you damage someone else's vehicle and are at fault, as you don't want to be held responsible for paying someone else's medical bills or repairs. Filing a claim can also help cover your legal defence costs if you're taken to court.

Ultimately, the decision to make a claim depends on your specific situation and the coverage provided by your insurance policy. It's important to carefully review your policy and consider seeking advice from a qualified professional before making a decision.

When to file a claim

When to file an auto insurance claim is dependent on several factors, including the type and extent of damage, injuries, and the cost of repairs. Here are some scenarios that outline when to file a claim:

• Accidents involving injuries: If there are any injuries to yourself, your passengers, or anyone else involved in the accident, you should file a claim. Some injuries may not be immediately apparent, and underlying health conditions can increase the likelihood of delayed symptoms. Having an open claim and a police report will help protect yourself from unforeseen complications.
• Significant damage or total loss: If your vehicle sustains significant damage or is deemed a total loss, you should file a claim. This is true even if you are at fault, as your collision insurance will cover repairs minus your deductible.
• Damage to someone else's property: If you damage someone else's vehicle or property, it is generally recommended to file a claim. Even if the damage is minor, it is safer to involve your insurer. The other party may demand more money later, and your liability insurance is there to protect you from such situations.
• Accidents involving multiple parties: If you are involved in an accident with multiple parties, you should file a claim. This will allow your insurance company to work with the other parties' insurers to assign responsibility and arrange payouts.
• When your out-of-pocket costs exceed your deductible: If the cost of repairs is higher than your deductible, filing a claim can help save you money. For example, if the damage is estimated to be $1,500 and your deductible is $1,000, you would only pay $500 out-of-pocket with a successful claim.
• When your vehicle is damaged by an uninsured or underinsured driver: If your vehicle is damaged by a driver who doesn't have insurance or has insufficient coverage, you can file an uninsured or underinsured driver claim if you have that coverage.

When Not to File a Claim

• Minor damage with high deductibles: If you're involved in a minor accident that only causes minor damage to your vehicle and no injuries, you may consider not filing a claim to avoid increased premiums. For example, if you back into your mailbox and cause a small dent, the cost of repairs may be lower than your deductible, making a claim unnecessary.
• When repair costs are lower than the deductible: If the estimated repair cost is lower than your insurance policy's deductible, filing a claim may not be worth it. In such cases, you may opt to pay for the repairs out of pocket to avoid potential premium increases.
• When the mishap only involves you and your car: If you only have liability insurance and no collision coverage, your policy doesn't cover damage to your car. In this case, filing a claim would not be necessary.

It's important to carefully consider the specific circumstances of the incident, review your insurance policy, and weigh the potential costs and benefits before deciding whether to file an auto insurance claim.

When not to file a claim

If you have only purchased liability insurance and don't have collision coverage, your policy won't cover any damage to your car. In this case, it's not worth filing a claim for damage caused only to your car.

If you have collision coverage, it will cover damage to your car. However, if the cost of repairs is less than your deductible, there's no point in filing a claim. For example, if you dent your bumper backing into a pole, it might be better to pay for repairs yourself rather than filing a claim.

If the repair costs for your car are more than your collision deductible, consider whether filing a claim is worth the risk of a rate increase later on. Insurance rates may go up after a claim, depending on your previous claims history, your insurance company's rules, and even your state's regulations. Weigh the potential payout against the possibility of higher premiums in the future.

If you're unsure about whether to file a claim, it's always a good idea to consult with a qualified attorney or insurance expert to review your specific situation and make an informed decision.

What to do before filing a claim

Before filing an auto insurance claim, there are several steps you should take to ensure the process goes as smoothly as possible. Here is a detailed guide on what to do before filing a claim:

Check for Injuries

The first thing to do after a car collision is to check for possible injuries to yourself, your passengers, and any other parties involved. If there are any serious injuries, it is crucial to call for emergency medical assistance immediately. Even if no one appears to be hurt, some injuries may have delayed symptoms, so it is a good idea to monitor yourself and others for any signs of injury in the hours and days following the accident.

Alert the Authorities

If the accident results in serious injuries, significant property damage, or impedes traffic flow, you should notify the police or highway patrol. They will dispatch officers to the scene, document the incident, and create a police report, which can be crucial when filing an insurance claim. In some jurisdictions, the police may not respond to minor accidents, but it is still important to file a report at the nearest police station to have an official record of the incident.

Gather Information and Document the Scene

While still at the scene, obtain as much information as possible, including the names and contact details of all involved parties, including witnesses. Exchange licenses, car registrations, insurance information, and vehicle details with the other driver(s). Take photos and videos of the accident scene, capturing vehicle damage, property damage, and any relevant details such as street names, traffic signs, and weather conditions. This documentation will be valuable when filing your insurance claim and can help protect you in case of disputes or conflicting accounts.

Contact Your Insurance Company

Reach out to your insurance company as soon as possible, even if you are unsure whether to file a claim. Notify them of the incident and inquire about the specific coverages included in your policy. Ask about any time limits or deadlines for filing claims, submitting bills, and providing additional information. Understanding your policy coverage and claim procedures will help you make informed decisions about the next steps.

Understand the Claim Process and Requirements

Find out what documents and proofs are needed to support your claim. Your insurance company will likely require a "proof of claim" form and a copy of the police report. They may also request additional documentation, such as repair estimates, medical bills, or other receipts related to the incident. Ask about the timing and deadlines associated with your claim to ensure you don't miss any critical dates.

Assess the Damage and Repair Costs

Before deciding whether to file a claim, consider the extent of the damage and the associated repair costs. Compare these costs to your insurance policy's deductible, which is the amount you pay out of pocket before your insurance coverage kicks in. If the repair costs are lower than or only slightly exceed your deductible, you may opt to pay for the repairs yourself to avoid potential increases in your insurance premiums.

Weigh the Benefits and Consequences

Filing an insurance claim can provide financial relief and help cover the costs of vehicle repairs, medical expenses, and legal fees. However, it is important to be aware that filing a claim may result in increased insurance rates, especially if you are found to be at fault for the accident. Consider the potential impact on your premiums and whether the benefit of filing a claim outweighs the possibility of rate hikes.

How to file a claim

It's important to know how to file a claim with your car insurance company, as it can be a tricky process. Here is a step-by-step guide on how to do it:

Firstly, you should contact your insurance company as soon as possible, even if you are still at the scene of the accident. You can do this by phone, or by filling out an online form or using your insurance company's app. It's important to do this even if the accident seems minor, as you need to find out whether your policy covers you for the particular loss. If you have comprehensive coverage, for example, and your car was vandalized or stolen, you would file a claim for the related loss.

Secondly, you can use a mobile app to jumpstart your claim. Many insurers now have apps that allow you to report a claim, check its status, upload photos, and even notify the insurance adjuster what happened by visually recreating the accident.

Thirdly, find out what documents you need to support your claim. Your insurance company will require a "proof of claim" form and a copy of the police report.

Fourthly, understand the timing of your claim. Ask your insurance company if there is a time limit for filing claims and submitting bills, resolving claims disputes, and submitting additional information. Also, find out when you can expect the insurance company to contact you.

Fifthly, find out if your policy pays for a rental car while your car is being repaired.

Finally, supply the information your insurer requests. Fill out the claim forms carefully and keep thorough and organized records of anything related to the claim, including the names and phone numbers of everyone you speak to at your insurer, and copies of any bills related to the accident.

It's worth noting that you should file a claim as soon as possible after an accident, and that your insurance rates may rise after you make a claim, even if you are not at fault.

Tips for filing a claim

• Contact your insurance company to report the accident as soon as possible. Be prepared to provide details such as which covered vehicle was involved, the location and time of the accident, a basic description of the accident, the name and insurance information of the other driver, and the names and contact information of any witnesses.
• File a police report. Your insurance company will request a police report number, which you can obtain by going to a local police station.
• Wait for an adjuster. The insurance company will assign an adjuster to your claim, who will contact you for additional information and either inspect the damage to your vehicle or ask you to take it to a certified repair shop.
• Get a report from the insurance adjuster. The adjuster will provide an initial estimate of the cost of repairs, which the insurance company will take into account when determining how much they will pay.
• Decide whether to use the insurance company's repair shop or your own. If you use your own shop, you may have to pay for any costs exceeding the adjuster's estimate.
• Settle the claim. This can take a few hours or a few days, depending on the complexity of the accident. The insurance company will either pay the shop directly or send you a check.
• If you have rental car reimbursement coverage, your insurance company can arrange a rental car for you while your car is being repaired.
• Keep in mind that filing a claim may increase your insurance premiums, depending on the circumstances and your insurance company.

Frequently asked questions