Last week, I was in a minor accident in which I was not at fault. I highlighted all the information to get from the other driver so the claims process goes as smoothly as possible. Some of the readers stated they would go the route of not reporting the claim at all, whether it was their fault or not because of the potential premium increase they would receive. Of course, this would depend on the age of the car as well as the make and model. You need to determine the value lost to the potential premium increase you will face. Of course, these are both estimates that you will not know the complete answer to until the actual even happens (you renew your insurance and/or you sell your car).
I researched quite a bit about whether rates would rise for an accident in which I am not at fault. Here is a list of sites I found.
In a nutshell, it is a mixed bag of opinions about whether insurance premiums will go up after reporting or filing a claim for an accident that was not my fault. Another factor to consider is risk tolerance. If you are comfortable that if you take no action to avoid any premium increases, you may want to consider not filing. However, if you worry that the other driver will report a different story to their insurance or other issues may arise, it could be well worth the peace of mind to get the claim filed and let your insurance help you with the process. According to an attorney firm in my state, they recommend following up with your insurance in every case.
Another common theme I found is that it greatly depends on the number of claims you have filed prior to the current one. Many state that there will be forgiveness for at least one accident, while others point out that some policies give a “no claim” discount that could be lost on any claim filed.
What did I opt to do?
Considering my risk tolerance, age of my car, and driving record to this point, I did opt to let my insurance know about the accident and that I expected it to be classified as not my fault. I also stated that I wanted payment to come from the other insurance company and would not start the process of having the damage assessed until I received confirmation from the other insurance that they would accept responsibility and pay. The accident was cut-and-dry, so it only took a day to receive confirmation from the other driver’s insurance that they accept responsibility for the accident.
At that point, I went ahead with the damage assessment. It came out to $750 in total to fix. I checked Kelly Blue Book to check the trade in estimates between very good, good and fair condition for my car. It is a $300 difference between very good and good and $1000 between good and fair. Based on the questionnaire on the site, my car can likely be classified in good condition, but just in case, worst case is $1000. That, of course, is if I was to sell my car now. I don’t plan to sell it for many years now and the margin from one level to the next will continue to decrease.
Therefore, I have decided keep the money and drive the car as is. I might look into some DIY options for fixing the bumper up a bit, but I will have to research what those options are and if it is worth it. I was going to look into a diminished value claim that can be filed after repairs are completed with the other driver’s insurance to receive the difference in the car’s value before and after the accident. Because I am not going to have it fixed, I cannot pursue that.
Actually, I think there is a small sense of relief when a car “graduates” to this level, where its primary purpose comes back to the forefront. It is not about status or gadgets, but simply to get me from here to there safely and reliably. My car has done that very well, and I am proud to let it continue its primary function without worrying about every possible scuff or ding while in a parking lot or on the road.
Of course, I won’t know until my insurance renewal period (in December) if I made the best financial deal, but it is important to look at all factors and make a decision that makes sense for you. And it is important to shop around for insurance rates regularly to make sure you are getting the best deal possible.
What about you? How have you handled a minor accident? Have you experienced a rate increase even from an accident that was not your fault?