Are You Required to Report All Accidents to Your Insurance Company?
Find out if you’re getting ripped off on your car insurance in less than two minutes.
No long forms · No spam · No fees
It may seem like a no-brainer to report an accident to your insurance company, especially when the accident results in serious damage or injury. But there are actually a few circumstances in which rushing to file an insurance claim is not in your own financial best interest.
Whether you’ve just been in a small fender bender or are dealing with the repercussions of a more serious accident, here’s what you need to know about when to report a car accident to your insurance company and how to keep your rates down while doing so.
Filing an insurance claim after an accident
Most major car insurance companies, such as Allstate, require that you report all accidents to them, no matter how minor. Other insurance companies, however, provide insured parties with more leeway, giving them the ability to decide when to file a claim in some circumstances.
No matter how serious the accident, or which party is found to be at fault, all car collision claims will increase your monthly insurance bill and/or raise your deductible. If this occurs, insured parties can be monetarily penalized for up to three years in some states, so filing an insurance claim is not a decision you should take lightly.
Because of these negative repercussions, as a general rule of thumb, car owners with the ability to decide when to file a claim should only do so when they are certain they will receive more money in reimbursement than they will spend on the required fees associated with receiving your insurance benefits (i.e., rate increase, a higher deductible, etc.).
When you should file an insurance claim
In the event of a car accident, it can be difficult for both parties to discern whether to get their respective insurance companies involved in the conflict, especially if it was only a minor incident that will result in no long-term car issues. However, you should certainly file a claim in the following circumstances:
If your insurance company requires that you file a claim each time you are in an accident. In this case, you really must comply with their rules. By signing your insurance contract, you have already agreed to the terms and conditions specified within the agreement, and any breach of contract will be considered fraud and can result in your insurance getting canceled. Always following the guidelines your insurance provider sets out, and if you have any questions about expectations, you should reach out to your insurance agent directly so they can clarify their expectations and your rights.
If the person at fault for the accident is contested or unclear. Under these circumstances, it may be in your best interest to file a claim with your insurance company, especially if there were any significant damages or injuries. To decide who is at fault and holds liability for the accident, both the authorities and your insurance provider will work together to determine who is liable for the accident and will outline any necessary next steps, so you simply need to sit back and allow them to do their due diligence to handle the claim appropriately.
If there are any injuries or serious car damage. You must file a claim with your insurance if you do not intend to be held liable for the situation and pay a large sum of money out-of-pocket to cover the cost of physical and/or material damages. An accident of this caliber is exactly why car owners purchase collision coverage, so take advantage of the benefits you have paid into and allow your insurance company to help you cover the cost of repairs.
When not to file an insurance claim
In the event that your insurance provider leaves the decision of whether to report less serious accidents to your discretion, you should understand the circumstances in which filing an insurance claim can actually hurt more than help you. Here are a few occasions where you should consider not filing an insurance claim:
If the accident results in minimal damage and injury. In this case, filing an insurance claim and managing the financial repercussions may not be worth the hassle, especially if you have a high deductible or have not yet met your deductible. If you are unsure whether filing a claim is in your best interest, consider getting an estimate for the cost of any necessary repairs and assess both outcomes (with and without involving your insurance) to see which provides you with the least amount of stress and the highest amount of cash in hand. Just be sure you are aware of your state’s and/or insurance company’s statute of limitations for filing a claim after an accident to make sure that you don’t miss the window to file while making your decision.
If the accident is your fault, but only resulted in damage to your own vehicle. When this happens, you should consider not filing an insurance claim because it may actually be cheaper to pay for everything out of pocket. This is not true in every circumstance, as it depends on the amount of damage and specific clauses within the contracts of both insured parties, but drivers sometimes find that they save both time and money by simply working it out together without getting any additional parties involved. If you decide to take this course of action, get any agreement in writing to ensure that you are both held to the conditions of the agreement both now and in the future.