When and When Not to Claim from your Insurance
If you’ve been in an accident, hopefully you are insured. There are two types of insurance you can get, including “liability” and “comprehensive” insurance. Comprehensive insurance covers any type of injury to your car, sometimes covering it completely but usually covering it with a deductible you must pay before the insurance company pays. Liability insurance only covers for anything you did that damaged another person or vehicle.
Especially with comprehensive insurance, it may be better to pay out the cost of the auto repair yourself than it is to turn it into your insurance company. If you turn it into your insurance company, an accident goes on your record and, if it was your fault, you could have an increase in premiums for the remainder of your driving time with that company. You may be dropped from the insurance company if you have had several accidents or if the payout by the insurance company was particularly steep. In such cases, it may be worth it to pay the costs of the auto repair so that your insurance rates and membership aren’t in jeopardy.
In addition, it could be that the cost of the repair is within your means to pay it or that it is less than the cost of the deductible (excess.) In such cases, it is a good idea to forget the insurance claim and pay the costs out of your own pocket. That way, the insurance company doesn’t know that you’ve been in an accident and your record remains clean. You need to first get an estimate of the cost and decide whether or not it is above your deductible and whether or not you can pay the difference between the cost of the repairs and the cost of the deductible.
The first thing you must do when you get into an accident is to check your policy limits and the deductibles (excess.) You should then go out and get an estimate as to the cost of the repairs of the vehicle. You need to make sure there are no claims against your insurance on behalf of the other party or parties to the accident. If so, you’ll have to file anyway so it doesn’t matter what the cost of the repairs to your car is. They will automatically pay the difference between the deductible (excess) and the actual cost of repairs because they know about the accident already.
If there are no claims against you on behalf of the other party or parties, you can decide whether or not the repairs are higher than or less than the deductible. If they are less than the deductible, then you can go ahead and pay for the cost without contacting the insurance company.
If your cost of repairs is greater than the deductible, decide what you want to do. If you have plenty of money to pay for repairs, don’t contact the insurance company and quietly pay out of pocket. This will save you the change in premiums and will keep your insurance record clean - it’s always a good idea to only claim from your Insurance policies for high value losses.