Unfortunately, chances are at some point we will all be in a car accident. Accidents can be scary, costly, and time consuming. The good news is, that there are a few things you can do to help yourself have a better experience. I will share a few suggestions that hopefully will help educate you on how the process works by removing some of the questions and misconceptions about the claims process.
To begin with, please understand that these suggestions are for minor accidents and fender benders. If you or someone else is injured, if you are in a high traffic area, or there are other dangers in the area, this most likely does not apply. There are many scenarios and situations that would call for a much different game plan.
I always suggest taking pictures of all 4 sides of both vehicles, take a picture of their license plate, their drivers license, and insurance card. This can be beneficial in multiple ways, but especially in a situation where the person claims more damage was a result from your accident than really was.
Assuming it is a minor accident or fender bender. If you are at fault, you should try to determine the severity of the accident. If it very minor, and it is something you believe you can pay for the damages out of pocket, see if the other person would be willing to exchange information with you and avoid calling the police. Often times if it is a small bump that does not inflict much damage, in the long run you will be better off paying for it out of pocket, as this will not result in your premiums going up. Many times a small fender bender that only pays out a couple of hundred dollars, your premiums could be increased by that much or more, and that sticks with you for 3 years. This is not taking into account if you have other accidents or tickets. This could potentially save you money, and both of you time. This suggestion should be used with caution and it is not always the best idea. If the other party complains of any injuries (weather you believe them or not) you should call the police. You are still responsible, and you should very quickly try to repair the other persons vehicle. You should also keep in mind, that even if the police are called, you still have the option to pay for the damages you caused out of pocket, and again this can still help protect your premiums from increasing in the future.
On the reverse side, I usually suggest calling the police if the other person is at fault. I have heard many stories of people who let the other person go, to later find out they gave false information, there was more damage to their car than they originally thought, and the other person refuses to pay and/or denies they were involved. Calling the police will protect you, and help ensure that the other person is held responsible.
It is important to remember, that in the event that you are at fault in an accident, you are legally liable or responsible to return the person you struck to a similar financial situation as they were in immediately prior to the accident. If you cause $1000 damage to their car, you owe them $1000. However, if the other party claims it was their grandfathers truck that you just totaled and that it was worth $20,000 to him, but the current market value of the truck is only $3,000, you only owe them $3,000. You buy insurance to transfer this risk. Essentially the insurance company tells you that in exchange for your premium of $XX we will agree to pay any claims you are legally liable for up to your limits of liability. This is a very common misconception, many people think that if they are buying the state minimum limits of liability which are $25,000 bodily injury per person, $50,000 bodily injury per accident, and $25,000 property damage that no matter what sort of accident they are in that is the most the other person can collect. This is simply the most the insurance company will pay on your behalf. If you carry these minimum limits and run off the roadway and into a house causing $100,000 damage, your insurance company will pay the first $25,000, and then you will be left owing the other $75,000. Unlike many other debts, if you are legally liable for damages to property or for bodily injury, they can take your primary residence, they can take savings, retirement accounts, cars or any assets, they can even take future inheritance, and can receive a portion of your paycheck for the rest of you life. These are all assuming you did not buy enough insurance, which is why we always suggest buying higher limits.
So you have now determined yourself who was at fault, and you have decided to call the police. Once they arrive tell the truth, and give a very detailed explanation as to what happened. Be very nice and cordial to the other person and to the police officer. Respond to questions with yes sir or ma’am or no sir or ma’am. Giving a detailed account will help not only the police officer to correctly determine fault, but also will help your credibility in the situation that you and the other party have conflicting stories. Also, remember it is ok to check on the other person, but never say, “I am sorry!” as this can be construed as admitting guilt. Most insurance companies do not want you to admit guilt, they want to look at the facts and determine who was truly at fault.
If you are at fault, you should then contact your insurance agent as quickly as possible to set up a claim. Again, this will help ensure your car and the other persons car is repaired and the process goes as smoothly and quickly as possible.
If you are not at fault, never call your insurance company to turn in the claim. You are not responsible for fixing your car, nor is your insurance company if the other person is at fault. The other person and/or their insurance company is responsible. However, it is usually a good idea to call your agent and just make them aware of the situation. You should suggest they take down the information you have and make notes in your file, so that if something falls through, or the other person does not have insurance, enough insurance, or the other persons insurance is refusing to pay that you have made your agent aware, and were not trying to conceal anything.
If you car is not driveable, and the other person was at fault, the other person and/or their insurance company owes you a rental car for you to commute to work or school until your car is driveable. They do not owe you a luxury car, or a large SUV… They owe you something that will get you back and forth to work or school until your car is repaired. If you immediately go and rent a car that is $70/day, understand that the other persons insurance is not going to repay you for that amount, they are going to pay for one of the cheapest cars you can rent.
Your insurance agent is your agent with your insurance company. Most insurance agents do not have a license to practice law. If you ask us to contact the other persons insurance company, please understand that at that point we would be acting as your lawyer and we are not legally allowed to do so. Unfortunately, you will have to deal with the other insurance company yourself.
Again, be nice and cordial to the adjuster. You want the adjuster to like you and be your friend. If you are rude and demanding, they can very easily stall or try to do everything they can to pay you less. Many of my customers when they get to this point are so sure that the other insurance company is going to try and not pay them what their car is worth, and call me upset. Please understand that a vast majority of the time, the insurance company (with the exception of certain carriers) want to pay you what you deserve and move on down the road. I have even seen a few claims where the person was paid more than they deserved. Again, by being rude and demanding you are only hurting yourself. Most insurance companies today have cut staff, and adjusters have many claims they need to adjust in a short amount of time. They would rather pay the claim correctly at the price you deserve and move on to the next customer, they are usually not interested in dragging out the process and fighting back and forth with you over a value.
On to the bad… There are some insurance companies that will try to avoid paying a claim, or even claim that you were partially at fault so they are only going to pay you part of your damages. This is where you call your agent back. Hopefully you have uninsured and underinsured motorist coverage. This coverage usually carries a lower deductible and a claim filed under this coverage is not nearly as bad on your premiums as a liability claim or a comprehensive/collision claim. Once you turn in the UM claim, your insurance company will review the case, and many times they will go back and sue the other insurance company. This is called subrogation. If your insurance company wins and gets their money back, then you will not be charged for the claim at all. Your insurance company also will be fighting to get your deductible back as well and will send you a check back, if they receive enough money. Without uninsured or underinsured motorist coverage, you would be able to file a claim under your collision coverage, and again your insurance company will most likely subrogate against the other carrier. You will have to pay your deductible, and if your insurance company does not win, it will show as a claim against you and cause your rates to go up. So this is your last resort to get your car fixed, and why you do not want to call your insurance company up front and open a claim when you were not at fault.