Insurance » Auto Insurance » When to File a Car Insurance Claim? (And When Not)
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When to File a Car Insurance Claim? (And When Not)

Your claims history impacts your auto insurance premiums. Therefore, there cases when you'll prefer to avoid filing a claim. Here are our recommendations.

You can trust the integrity of our unbiased, independent editorial staff. We may, however, receive compensation from the issuers of some products mentioned in this article. Our opinions are our own.

Table Of Content

In the United States drivers are required to have auto insurance any time that they choose to drive. But that doesn’t mean that you are required to make a claim against your insurance company if anything does happen while you’re driving.

For some, this seems strange. After all, the insurance company is going to pay for the damages so why wouldn’t you file a claim?

The reason behind that is that there are some things that just aren’t worth you filing a claim. Especially since your history of filing claims is going to go against your premium.

Over a million drivers are arrested for a DUI each year in the US. This offense not only carries fines and other penalties, but it also impacts the cost of car insurance. In this chart using The Zebra data, you can see the cost of car insurance almost doubles after a DUI for both minimum coverage and full coverage. This means that you can expect to pay an average of over $3,100 compared to approximately $1,600 if you had a clean driving record.

How Much a DUI Raises Average Car Insurance Costs (1)

How Claims History Impacts Your Auto Insurance Premiums?

If you are at-fault for any claim that you file your insurance company will raise your premium. Or at least, they’re allowed to. Filing a lot of claims is another reason that your insurance company may increase your premium.

That’s going to depend on the specific insurance company you have your policy through and the type of claims that you’re filing, but if you’re filing a lot, no matter what they’re about, chances are you’re going to have some increase.

You may be wondering what that means for claims where you’re not actually at fault. Should you be making those claims?

If you’re not at fault and you still make a claim that actually doesn’t hurt your insurance premium. At least, it shouldn’t affect you and in most cases your state will protect you on this. But the number of claims that you file can affect you. Too many claims will negatively affect your rates. But it’s still not going to be as bad as having an at-fault claim on your record.

For some, making a claim just isn’t worth it or seems like it might not be worth it. You might want to just pay for the repairs to your vehicle on your own. That’s acceptable and may even make more sense if your vehicle is the only one with damage. On the other hand, if you’re in an accident with another person or vehicle you’ll want to make a claim to protect yourself from additional damages.

Consider Your Deductible

The deductible on your policy is the amount of money that you’re on the hook for if you make a claim. That’s something to look at when you’re considering whether you should make a claim.

If your cost for repairs is going to be less than or somewhere close to the amount you’ll pay for your deductible you may want to just pay for it yourself. After all, making that claim could impact your premiums and that’s definitely not something you want to deal with.

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Car Insurance Claim Time Limit

There is no specific time limit on when you are supposed to file an insurance claim, and you should seek your insurer's guidance on the claim time limit. To be successful in your claim, you must prepare all the perquisites on time.

For instance, get a police report, present a medical clearance, and have all other fundamental documents required to validate your claim. It is also important you notify your insurer earliest possible.

 What to Expect When You File a Car Insurance Claim?

Depending on the number of claims in question and the accident severity, your insurance company will require you to provide all facts about the accident. Be prepared to provide original documents like your ID, police report, medical assessment report, repairs estimate, etc.

If the facts you provide are questionable, your insurance company will require you to provide your phone conversations, scrutinize your social media accounts, visit the crash site, and more.

Where the accident was severe, expect the investigation to take a while, several weeks, or even months. For light accidents where your car had minor damages, get the estimates and take your car to a repair shop. The insurer will take care of the bill when settling your claim.

When to File a Car Insurance Claim?

There are a number of different times when you absolutely should file a claim to protect yourself.

There is an Injury or Possible Injury

If someone else has been injured or you think they may be injured you absolutely need to file a claim.

If there are medical expenses you don’t want to be on the hook for those and chances are the other individual is going to tell their insurance company, which means your insurance company will find out.

You want to make sure that you check in with anyone who is involved in the accident and if there’s even the possibility of an injury (including things like whiplash) you want to make sure that you have reported it to your insurance company. Delay too long and you could be on the hook for the medical and other expenses related to the accident.

There is Someone Else Involved

If there’s another driver involved you want to make sure you report it to the insurance company. Some people will make agreements verbally with the other driver, which may work out great. But it could also be a potential problem.

You could find yourself in trouble if they report it to their insurance company despite the agreement that you’ve made.

Liability insurance helps you in case you are sued and the other parts of your insurance will make sure that you are protected and covered for any other work that the driver needs. You don’t want to be on the hook for those expenses or have to deal with an angry individual if you don’t give them what they want to keep it out of the insurance company.

You Have a Significant Loss

If your vehicle is totaled or if there’s significant damage to your vehicle you absolutely need to file a claim in order to get reimbursed and make sure you can get on with your life.

It’s Unclear Who’s At Fault

If you’re not sure who is actually at fault you should probably file a claim to make sure that your insurance company can help you.

They will defend you, in court if necessary, to make sure they don’t have to pay as much in damages. You don’t want to take on that responsibility for yourself.

When Not to File a Car Insurance Claim

However, there are cases you may prefer not to have to file a claim, depends on your specific circumstances. However, it doesn't correct for all cases so you should carefully asses your situation:

Single Car Accidents With Minimal Damage

If you’re the only vehicle involved and there’s not a lot of damage you can take care of the repairs for yourself.

You don’t need to file a claim and you can avoid having to pay that deductible or any of the other costs associated, like an increase in your insurance premium.

Most drivers are aware that crashes can have an impact on insurance costs. In this chart using The Zebra data, you can see that an at fault crash increases the average cost of minimum coverage from $565 to $884. The price increase is even more significant if you have full coverage. You can expect to pay as much as 50% more on average.

How Much an at-fault Crash Raises Average Car Insurance Costs

Damages Are Below the Threshold

If you have a minimum payment threshold for your insurance company you may not want to file a claim either.

This could mean that the insurance company pays a set amount without increasing your rates. It’s not offered with all insurance companies, but some do allow it.

Minimal Damage Accidents With Other Vehicles (Keep in mind: This is a bit Risky)

Keep in mind that you never know what the other driver is going to do when you make an agreement about any kind of accident. If you think that there’s minimal damage and the other driver agrees you can choose not to report it to your insurance company. You just need to make sure that you can afford to pay for your repairs and the other persons as well (if you are at fault).

Keep in mind what your deductible is and how much your premiums are likely to go up. You may be able to settle with them outside of the insurance company. But this is a risky endeavor. If you pay them and then they turn it in anyway you could be on the hook for even more money and you could have trouble getting your insurance company to pay the settlement or to reimburse you for the expenses.

Look into the amount that your insurance rates could go up when filing a claim and make sure you keep that number in mind whenever you’re thinking about filing.

You don’t want to put yourself in too much of a negative situation and you don’t want to end up paying a whole lot in insurance premiums because of claims you could have handled on your own.

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Which Insurance Company is Best at Paying Claims?

The J.D. Power 2020 U.S. Auto Insurance Satisfaction Study found that State Farm, Erie and Geico were three of the top national insurance companies with the highest customer satisfaction ratings.

The study revealed which insurance companies provide the best customer service. You would have a positive experience with these brands if you were looking for a new insurance company to open a policy.

Filing a Car Insurance Claim: Things To Consider

It can save you time, headaches, heartache, and paperwork involved in handling an auto insurance claim. You can also get more value from your insurance dollars. Follow these steps to file a claim if your car is in an accident or damaged by flood, fire or vandalism.

  • Call your local representative or insurance agent – Even if you are far away from home, it is important to file your claim as soon as possible. Ask your agent for advice on how to proceed. Also, what documents or forms will be required to support your claim. Your company might require a “proof-of-loss” form. Also, you may need documents related to your claim such as medical bills or auto repairs.
  • Auto body shops can be chosen by insurance customers to repair their vehicle – There are many states that have laws prohibiting steering to repair shops.
    Hire an auto body shop that offers guarantees and specific time frames for repairs – You have insurance policies that limit your liability and deductibles. Before you agree to repair costs, make sure you know the settlement amount. Most insurance companies will give you a list with repair shops that offer labor and repair guarantees if you aren't sure where to take your vehicle.
    Provide the information that your insurer requires – Your insurance company should cooperate in the investigation, settlement, or defense of any claim. You must also immediately turn over any legal papers related to your loss to them. If you are the victim of an accident, your insurer will defend you.
  • Keep track of all your expenses – Your policy may reimburse you for expenses incurred as a result an auto accident. For example, your policy may reimburse you for medical and hospital expenses and any lost wages. It might also pay a portion of the cost to hire a housekeeper temporarily.
  • Keep a copy of all your papers – Keep a copy of any paper work in your files. It is possible that you will need it again.

If you are not satisfied with the settlement offer, talk to your agent or adjuster. To see the settlement steps, check your policy.

Documents Required For Car Insurance Claim

When placing a car insurance claim, ensure you produce the following compulsory documents.

  • Your car insurance policy details (policy paper or a copy of the cover),
  • The driving license of the driver who was involved in the accident,
  • The registration certificate of the insured vehicle,
  • A valid claim intimation form,
  • Proof of the identification.

Your insurer will also require you to state your loss extent. As a result, ensure to provide the estimated repair by giving out a valid invoice or receipt of payment or a valid canceled check. Also, ensure you have a police report outlining the events of accidents and your medical assessment report.

Why's My Car Insurance Claim Denied?

One of the reasons your insurer might have denied paying the claim is that your policy might have a limit. As a result, you must evaluate your claim downwards to match the policy limit and place the appeal. That means, if the repairs exceed what the insurance is paying, you will have to settle the difference out of pocket.

Also, the insurance claim can be denied if you are placing a claim against what your policy does not cover. For instance, you may have an insurance policy that does not cover auto theft. If the incident occurs and you attempt to place a claim, your insurance will decline to compensate you.

Besides the above, your insurance might deny you compensation if you are in an accident where you were the one who violated the law. Other grounds for claim denial may include failure to report the accident on time, not presenting a medical report, or even providing false information.

Conclusion

Overall, it all depends on what you’re looking at and the individual claims that you’re considering filing. If you have to make a claim because the cost or potential cost is too high then go for it. You don’t want to risk having too big of expenses or getting sued and having to pay for it all yourself.

On the other hand, if the claim is minimal and especially if you’re the only one involved, you may be able to get by without making a claim to your insurance company. Overall, it’s going to be up to you.

FAQs

The direction the insurance claim investigation process follows will depend on the extent of the accident, the facts present, and the amount of claim you have placed for payment. For less complex accident where only the auto body was damaged, the insurance company may not involve investigators.  

However, if the accident is complex or your evidence is murky, the investigator must take extra steps to prove your claims. The investigation may involve the adjuster visiting the crash site, scrutinizing the police report, obtaining your medical assessment, recording witnesses' statements, requesting your phone conversations, even reviewing your social media presence, etc.

In a short answer, yes. If you are involved in an accident, and the aggrieved driver feels they have a valid claim against you, where you are both in consensus, you should provide the driver with your insurance details.

The claim is often known as a third-party insurance claim. However, it is up to the driver to follow up and build the case by presenting all the necessary evidence. From there on, your insurer will carry an investigation to verify the facts provided by the aggrieved driver.

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