Let’s imagine you’ve been in a car accident – a very small car accident. It’s so small, in fact, that you’re not even sure you should file a claim with your auto insurer.
You want to keep things as simple as possible, and you don’t want to risk a rate increase. On the other hand, you don’t want to be accused of hiding information or breaking the rules. So, what should you do?
If you can answer “yes” to all of the following questions, you probably don’t need to file a claim with your insurer.
1. Was the damage to your vehicle only?
If you caused damage to another person’s vehicle, you’re going to need to report this. The same goes for damage caused to other property – a building, for example. But if your vehicle was the only thing damaged, you may not need to file a claim.
2. Was the damage less than $1,000?
The more damage an accident causes, the more important it is to report it. In general, if an accident causes $1,000 or more in damage, it is significant enough that it requires reporting to your insurer.
3. Was the damage less than your deductible?
Your deductible is the amount you have to pay out of pocket before your insurer pays out for a claim. If the damage is less than your deductible, your insurer won’t pay anything. If the damage is more than your deductible, your insurer will pay the remainder, up to the coverage limit.
For example, let’s say you have a $500 deductible. If you get into an accident and cause $300 in damage to your car, you will have to pay the entire $300 out of pocket. In this case, filing a claim may not be worthwhile.
On the other hand, let’s say your deductible is still $500, but you caused $2,500 in damage to your car. In this case, you would pay $500 out of pocket, and the insurer would pay $2,000. In this case, you might want to file a claim with your insurer. However, you should also consider the cost of a rate increase. Once a claim is reported and paid, there could be a 15 percent surcharge on your insurance premium rate for three years if you were at fault for the accident.
4. Was no one injured?
If anyone was injured, you need to report the accident. This is true even for seemingly minor injuries. In some cases, the true extent of injuries may not be immediately apparent.
However, if you’re sure that no one was injured, and if you’ve answered yes to all the previous questions, you may not need to file a claim.
5. Are you following your state’s laws?
In addition to deciding whether you need to file a claim with your insurer, you also need to determine whether you need to report the accident to your DMV. Most states require that all accidents meeting set criteria be reported promptly.
In Texas, for example, you must report all accidents resulting in an injury, a death or property damage worth $1,000 or more. This report must be made within 10 days.
If you ever have any questions about auto insurance, your Higginbotham insurance agent can help. And, if you need to file a claim, our online claim reporting form is available 24/7. Contact us to learn more.