Understanding The Auto Insurance Claim Process: When To File

Understanding the car insurance claims process is important, whether you're a new or experienced driver. Claims are common and can cost a significant amount of money. It's important to know when to file a claim, as it can affect your record, car insurance rates, and have a financial impact. If your vehicle has sustained major damage, starting a claim should be a priority. However, in minor accidents or with smaller damage, it's worth considering whether to make a claim.

When to call your insurance company

Calling your insurance company after a car accident is crucial, even if you are not at fault. Here are some reasons why you should contact your insurance company as soon as possible:

You May Want to File a Claim

If you experience injuries or your vehicle sustains damage that affects its resale value, you may want to file a claim. Contact your insurance agent to understand your options and the next steps.

The Other Driver Might File a Claim

If you don't report the accident, your insurance company might deny any claims made against you or may not represent you if the other driver files a lawsuit. In such a case, you would be forced to pay out of pocket.

Your Insurance Policy Requires It

Your auto insurance policy likely includes a clause that requires you to promptly report an accident. By notifying your insurance company, you are fulfilling your contractual obligation to notify and cooperate with them, especially if you intend to make a claim.

You Live in a No-Fault State

If you live in a no-fault insurance state, you must first bring a claim for benefits under your personal injury protection (PIP) coverage before claiming against the other driver. PIP will cover your medical bills, lost wages, and replacement household services. Notifying your insurance company is essential to initiate this process.

There's a Dispute Over Who Was at Fault

Even if you believe the other driver was at fault, they may disagree and claim that you were to blame. Your insurance company needs timely notice of the accident to conduct a thorough investigation and protect your interests.

You Need to Claim Other Benefits Under Your Policy

You may need to claim benefits under other coverages in your auto insurance policy, such as uninsured or underinsured motorist (UM/UIM) insurance if the other driver doesn't have sufficient coverage. Additionally, you may want to claim medical payments ("MedPay") benefits to reimburse any out-of-pocket medical expenses not covered by your health insurance plan.

Your Insurance Company Can Investigate and Negotiate

Your insurance company has the resources to investigate the accident, gather evidence, and help prove the other driver's responsibility. They can also assist in negotiating a favourable settlement, especially if you are recovering from injuries or prefer not to deal directly with the other driver's insurance adjuster.

Understanding your coverage

Understanding Your Insurance Policy

Firstly, it's important to thoroughly understand your insurance policy and the coverage it provides. Familiarize yourself with the different types of coverage, such as collision insurance, comprehensive insurance, and third-party liability insurance. Each type of coverage will have specific provisions and exclusions that you need to be aware of. Know what is covered, what your deductibles are, and whether there are any limitations or restrictions on repairs or rental car coverage.

When to File a Claim

The decision to file an insurance claim depends on several factors. If you're involved in a major accident, causing significant damage to your vehicle or another person's vehicle, it is generally recommended to file a claim. Accidents involving injuries or suspected insurance fraud also warrant filing a claim. For minor accidents or small damage, you may want to consider the financial implications of filing a claim, as it could affect your rates in the future. Assess whether the damage exceeds your deductible and if you have the funds to pay for the repairs yourself.

Reporting an Accident

Most insurance policies require you to report an accident promptly, usually within a specified timeframe, such as seven days. Failing to report an accident in a timely manner may result in your claim being rejected. When reporting an accident, you will need to provide detailed information, including vehicle details, accident details, the names and license numbers of drivers involved, insurance information, and any relevant police reports.

The Claims Process

Once you've reported the accident, your insurance company will assign you an adjuster who will assist you throughout the claims process. The adjuster will explain your coverage and how it applies to your specific claim. They will guide you through the process of estimating the damage, choosing a repair shop, and scheduling repairs. Keep in mind that you typically have the right to choose the auto repair shop, but it's important to discuss the type of parts that will be used for repairs with your adjuster.

Rental Car Coverage

If you need a rental car while your vehicle is being repaired, check your policy or consult your agent to understand your rental car coverage. Find out if your policy covers rental car expenses and what the specific limitations or time limits are. Remember that delays in vehicle repairs may result in you reaching the rental car limit on your policy before the repairs are completed, leading to out-of-pocket expenses.

Claim Resolution and Payment

The time it takes to resolve a claim can vary depending on its type and complexity. While claims are usually resolved within 30 days, receiving payment may take longer. Keep in mind that your insurer should provide timely and clear explanations of their coverage decisions and how they will pay your claim. It is your right to receive timely responses to your questions and concerns throughout the claims process.

What to do at the scene of an accident

It is important to know what to do at the scene of an accident, as it can be a stressful and overwhelming experience. Here are some detailed instructions to follow:

Firstly, ensure you call your insurance provider as soon as possible, even if you are still at the scene of the accident. It is crucial to inform them about the incident, regardless of who is at fault. Even minor accidents should be reported, as your insurance company needs to be aware of the incident and determine if your policy covers the specific loss. It is also beneficial to use a mobile app, if available, to initiate your claim quickly and efficiently.

Secondly, gather all the necessary information and documentation. Obtain the other driver's name, contact information, and insurance details. Make a note of the make, model, year, registration, and license plate number of the vehicles involved. Additionally, document the date, time, and location of the accident, as well as any injuries sustained and the number of passengers involved. If the police are called to the scene, get the name and badge number of the investigating officer.

Thirdly, take photos of the accident scene, capturing the damage to all vehicles involved from multiple angles. These photos will serve as valuable evidence when filing your claim and can help support your account of the events.

If possible, move your vehicle out of the way of oncoming traffic to prevent further accidents or obstructions. If anyone is injured, call for medical assistance immediately. Your priority should be the safety and well-being of everyone involved.

Finally, contact your insurance adjuster and provide them with the details of the incident. They will guide you through the claims process and explain your coverage. They may also recommend repair shops and discuss the next steps with you. Remember to keep a record of all communications and documentation related to the claim, as this will help you monitor the progress and ensure a smoother claims process.

How to file a claim

It's important to understand your coverage and follow the claims process outlined in your policy. Claims are common and can cost a significant amount of money, so the process shouldn't be taken lightly.

• Call your insurance provider as soon as possible: Even if you are at the scene of the accident, it's important to let your insurance company know about the incident and find out whether your auto insurance policy covers you for the particular loss.
• Use a mobile app to jumpstart your claim: Many insurers now offer apps that allow you to report a claim, check its status, upload photos, and perform other tasks.
• Find out what documents are required: Your insurance company will likely require a "proof of claim" form and a copy of the police report if you filled one out at the scene.
• Understand the timing of your claim: Ask your insurance provider about any time limits for filing claims, resolving disputes, and submitting additional information. Also, find out when you can expect the insurance company to contact you.
• Find out about rental car coverage: If your car needs to be in the shop for repairs, ask if your policy covers a rental car.
• Provide the requested information to your insurer: Carefully fill out the claim forms and keep thorough, organized records of anything related to the claim, including the names and phone numbers of everyone you speak with at your insurer and copies of any bills related to the accident.

Remember, the choice of auto repair shop is typically up to you. Discuss with the insurance adjuster what kind of parts they want to use for the repairs. If you demand the use of new, Original Equipment Manufacturer (OEM) parts, you may have to pay the difference in cost.

When not to file a claim

When not to file a car insurance claim:

Firstly, if the damage is minor, you should think twice about filing a claim. If the damage is only slightly more than your car insurance deductible, or you have the funds to pay for the damage, it may not be worth it. This is because filing a claim can affect your record and car insurance rates, and have a financial impact. If the repair costs are less than your deductible, there is no point in filing a claim, as there would be no claim payment in that case.

Secondly, if you caused the damage yourself, for example, by reversing into a tree on your driveway, it may not make sense financially to file a claim as it could go on your record. An increase in rates could cost you more money in the long term than paying for the repairs yourself.

Thirdly, if the only damage is to your own car, and you only have liability insurance, your policy won't cover it anyway, so there is no need to file a claim. If you have collision coverage, weigh up the cost of repairs against the possibility of increased rates at renewal time.

Finally, if the damage is minor and you were at fault, it may be tempting to keep the incident a secret from your insurance company and pay for repairs out of pocket. However, if there are any injuries involved, it is important to tell your insurer, as you could be held responsible for paying someone else's medical bills.

Frequently asked questions