Have you ever been in a minor automobile collision and debated whether to notify your auto insurance provider or just pay for the damage yourself? When minor incidents result in no injuries and only minor vehicle damage, some people choose not to file auto insurance claims out of worry that doing so will result in an increase in their premiums. Some motorists would even prefer to settle the cost of damages out of pocket with another motorist than risk greater fees.
However, in some circumstances, not submitting a claim may have very negative effects. Let’s look more closely at how to determine whether or not to submit an auto insurance claim and what the impacts of a claim could be so you know exactly when you should make a car insurance claim.
When Should I Claim Car Insurance: Frequently Asked Questions
Should I file an auto insurance claim or pay for the damage out of pocket?
Understanding when to make an auto insurance claim is the initial step. There are numerous instances where filing a claim might be favourable.
When to file a car insurance claim
Many insurance experts advise filing an auto insurance claim with your insurer in the following circumstances:
● You are involved in a major vehicle accident that caused serious damage to your car or another person’s car.
● A collision you cause results in injury to someone, whether it’s you, a passenger, a pedestrian, or the other driver.
● You have reason to believe insurance fraud is taking place after the accident.
When not to file a car insurance claim
Before submitting a claim, policyholders should carefully weigh their options. Making a claim is a major decision that could have significant consequences. As such, it might not be a good idea to make a claim for every minor problem. In fact, you might be better off not submitting a claim for minor accidents or events. Below are some instances in which you may want to postpone filing an auto insurance claim:
● The damage is scarcely more than your deductible, if not less.
● The crash caused virtually little damage.
● You were the only one involved in the collision, and it was your fault.
● You have the financial means to pay for the damage without using insurance.
In most cases, it’s best to contact your insurance company as quickly as possible following a collision. If you try to resolve the issue with the other driver on your own, you run the risk of possibly having to go to court later if the other driver realizes that their car had more damage than they initially thought. Furthermore, suppose the at-fault party later makes a claim for damages or injuries that are connected to the collision, and you had chosen not to notify your insurance. In that case, your insurer may even be able to refuse coverage.
However, suppose the accident is minor involving just your car, and there are no injuries or property damage to other parties. In that case, you may just want to pay for damages yourself—especially if the expense of repairing the minor damage is lower than or almost equal to the amount of your deductible. The last thing you want is your insurance rates to go up for something that only needs a few hundred dollars in repairs.
If you are in a vehicle accident and are unclear about whether you need to submit a claim, consult with an insurance broker, like one of our experts here at aha insurance! If you want expert advice on whether filing a claim could be favourable for you, contact us today.
What are the impacts of filing a car insurance claim?
Your insurance may be impacted in a number of ways by submitting a car insurance claim. Specifically, it could result in an increase in your insurance rate based on the specifics of the claim and the accident details. However, your rates might not change if it is your first claim or if you were not at fault.
The circumstances might be different, though, if you’ve already made a number of claims or if you’re at fault for the accident. In the end, the result will depend on the damages, the kind of claim being made, and the determined fault. Below, we explore how various auto insurance claims involving collisions may affect your premiums:
● If you were deemed at fault: Your insurance company is likely to increase your premium if you caused the collision. Your insurance rate might not change instantly if you file an at-fault accident claim, however. Instead, your insurance provider might increase it at renewal time, so make sure you carefully review your renewal contract.
● If you were deemed not at fault: Your insurance premiums are not likely to go up if you file a claim for an accident that you did not cause, such as being rear-ended on a busy road.
● If you’re involved in several collisions: Your insurance provider will most likely raise your premiums, maybe significantly, if you keep getting into car accidents. You might even be labelled a high-risk driver if you make many claims due to at-fault accidents or driving convictions, which could lead to the termination of your policy. Obtaining auto insurance in the future could be exceedingly challenging and significantly more expensive as a result.
● If someone borrows your car and is in an accident: If your friend is at fault in an accident while driving your vehicle, it may have an impact on your insurance premium if they do not have their own insurance. If the driver does have their own insurance, the claim will follow them, but you must provide proof they are being charged with the accident on their insurance policy.
● If you have a clean driving record: Having a spotless driving record might also affect how much, if at all, your insurance rates adjust following a claim. A driving history free of accidents and convictions for several years in a row is considered a “clean driving record.” If you fit this description, your insurance company might not raise your premium, or if they do, it might just be slightly.
● If you have accident forgiveness insurance: If you have an at-fault accident claim, you can safeguard your driving record and help keep your insurance premium from rising by adding accident forgiveness as an endorsement to your vehicle’s insurance policy. The extent of this coverage varies by province, but if you have it as part of your insurance, your rates are unlikely to go up even if you were at fault for the accident (unless you are charged with a surchargeable incident, such as careless driving, passing a school bus, impaired driving, etc.)
Do I need a police report to file a claim?
No. In Ontario, you are not obligated to notify the police if the collision damage costs less than $2,000 for both vehicles! This means that if you were to get into a minor collision that cost $1,000 in damages, you could still make an insurance claim to fix your car without filing an accident report with the police.
However, even if you don’t intend to pursue an insurance claim, you might still want to submit a report in order to keep a record of it. Contrary to popular belief, making a police report will not in any way have an impact on your insurance.
However, in some situations, even if the damage is under $2,000, you must still submit a police report. These exceptions consist of the following:
● If one of the drivers does not have car insurance.
● If someone involved in the accident is injured.
● If the accident causes damage to private or municipal property.
● If the accident involved a pedestrian.
● If the accident involves a government vehicle.
● If the collision is a result of a criminal act, such as DUI, impairment, etc.
While filing a police report about a collision, you must file it within 24 hours.
How long do I have to file a claim?
Call your insurance company as soon as you can, ideally within a week, and give them all the details you’ve gathered since the accident. Given that some plans include a deadline for submitting claims, if you submit your report after seven days, they may not be required to honour your claim. Nevertheless, let your insurer know if it’s because of an associated medical reason (e.g., you were hospitalized after the accident).
So, is it worthwhile to file a car insurance claim over a dent in my bumper?
Honestly? It depends. The cost of the damage is the main variable that influences it. For instance, if the cost to fix the ding in your car is $600 and your auto insurance policy has a $500 deductible, the maximum amount the insurer may pay out is only $100. You might be better off just paying for the work yourself at this point than letting the claim appear on your insurance record and risking your rates going up.