When You Should and Shouldn’t File an Auto Insurance Claim

Being in a minor car accident may leave you wondering if it’s worth filing a claim with your insurance company or if you should pay out-of-pocket to cover damages. And while not filing a claim can prevent an increase in your auto insurance rates, there are a few scenarios in which filing a claim is important. Below we explain instances in which you should or shouldn’t file an auto insurance claim.

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When You Should File a Car Insurance Claim

Knowing when to file a car insurance claim can help you more easily navigate stressful situations involving your vehicle. There are a couple of instances in which it is extremely important that you file a car insurance claim in the event of an accident. These include:

If someone is injured: If you, your passengers, pedestrians or passengers in the other vehicle are injured, you will need to file a claim, especially if there’s a chance you could be at fault.
When the fault is unclear: If the fault of an accident is in dispute, you’ll need to file a claim with your insurance company so they can represent you in the event you are considered to be at fault.
If your vehicle is deemed a significant or total loss: If the cost to repair exceeds the value of your vehicle, you’ll need to file a claim.

When You May Consider Not Filing an Auto Insurance Claim

While it’s helpful to know when to file an auto insurance claim, it’s equally important to know when not to file one. Filing an auto insurance claim when you don’t need to can cause more hassle than it’s worth, as well as an increase in your premium. There are several scenarios in which you may not consider filing a claim, including:

Single car accidents: If you’re the only one involved in an accident, it may be easier to pay for the damage yourself instead of risking an increase in your insurance rates.
When the claim is about the same or less than your deductible: If the quote you received on the cost of repairs is equal or less than your deductible, you’re probably better off paying out-of-pocket to avoid adding to your claims history and potentially increasing your premiums.
The rate increase costs more than the repair: You’ll want to ask your insurance company if they are planning to increase your rate and by how much. The cost of the rate increase over several years may end up costing you more than just paying out-of-pocket for the repairs.
Minor accidents that both parties agree to settle privately: If there is minimal damage to your and the other party’s cars, you may be able to reach an agreement and pay for the repairs yourself.

Risks to Not Filing an Auto Insurance Claim

If you end up not filing a claim in a situation where you should have, there may be repercussions for you, your auto insurance coverage and your vehicle. Some of the risks of not filing an auto insurance claim include:

You could be denied later: If the other party files a claim for damages or injuries and you haven’t filed a claim with your insurance company, your insurance company may deny coverage.
You could be sued later: If you come to a financial agreement with the other party on your own, you run the risk of being sued later if the other party discovers that the damage was more extensive than they thought.
Damage can cost more than you think: Car repairs are often higher than what you initially think, and more times than not, it’s better to get your insurance company involved.

How to File a Car Insurance Claim

Filling an auto insurance claim is easier if you know the process ahead of time. There are six steps to filing a car insurance claim after you’ve been in an accident.

1. Be prepared with the necessary information: It’s critical to keep your proof of car insurance, emergency contacts and important medical information with you while driving in case of an accident.

2. Check for damages and injuries: While you’re at the site of the accident, document everything you can. Take pictures of the damage on your car and the other cars involved and ask for the contact information of any witnesses in case there is a disagreement about the sequence of events between drivers.

3. Exchange information with the other drivers involved, such as:

Name and contact information of all parties
Driver’s license numbers
Insurance company information
License plate numbers and registration for other cars
Make and model of all involved vehicles
Location of where the accident occurred as well as time of day, weather, and road conditions

4. File a police report: Having a police report is strong evidence to support your claim and will give you a better chance at receiving compensation.

5. Contact your insurance agent: You’ll want to find out the following things from your agent as soon as you can:

Time limitations for filing your claim
Time limitations for resolving claim disputes
If you need estimates for damages
If your policy covers a rental car while your car is being repaired

6. Get an estimate from an insurance adjuster: After contacting your agent, your auto insurance company will typically send an insurance adjuster to document damage and investigate the losses. The adjuster will determine who was at fault and provide an initial estimate of how much repairs will cost.

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