Auto insurance is something that people often purchase because it is required by the law, but most people hope never to use it. You may even have chosen higher deductibles for you to lower your insurance rates, however, as long as you drive your vehicle, there are high chances that you’ll get involved in an accident where your car gets damaged. Therefore, you will at one time require making a claim with your auto insurance company so that you can get reimbursed.
Although you may be hesitant to make a claim because you are afraid that the rates will go up, your insurance company may refuse to compensate you if you fail to make a claim or to report the accident.
Filing a Claim and Reporting the Accident
After an accident, it’s necessary to know what your insurance company requires before making a claim. Keep in mind that there is a difference between making a claim under your cover and reporting the accident. Every insurance company requires that the insured victims report or notify them of any event such as an accident that may later lead to a claim. This means that in a situation where you or someone else may request a reimbursement from an insurance company, you are required to notify them of the incident. Most auto insurance policies use language that often means an accident should be reported within a specific time which can be in a day or two.
Filing a claim means requesting the company to cover you based on the extent of the accident and the terms of your policy. Depending on your cover, this can mean paying for your medical expenses and paying for the car repairs. This can also mean that the other driver should file a third-party claim to your insurance company asking them to compensate their losses that were as a result of the accident.
After notifying your insurance company about the accident, your insurance company will most likely assign an adjuster to your case to investigate the happenings of the accident. This means that your insurance company will acquire the police report of the incident, and contact the other driver’s insurance company. They will also ask for witness statements on what happened during the accident.
Failing to Report an Accident to Your Insurer
In the worst scenario after failing to report an accident to your insurance company, they may try to cancel your policy because you breached the contract. If you don’t report an accident and later try to make a claim based on the same accident, you can be sure that your insurance company may deny coverage. Keep in mind that your auto insurance policy is a contract. This means that if you don’t do according to the contract, your insurance company can deny or cancel your cover.
For instance, what if you are involved in an accident, and both cars seem to have only experienced little damage such as a small dent. You and the other driver don’t experience any pain, and you decide that you won’t involve the insurance company. However, a few weeks later, the other driver gives you a call and says that he is experiencing neck pains and that he has thousands of dollars in vehicle damages. You may also later discover that your car experienced more damage than you initially thought. However, because you never notified your insurance company about the accident, they may refuse to compensate you or the other driver and put you on the financial hook.
If the other driver had filed a claim with his or her insurance company and gets compensated, they might come after you if they determine that you were at fault to recover what they paid out to the other driver. In case you had reported the case to your auto insurance company or made a claim, your insurance company may have disputed your fault or compensated the other insurance company. However, if you failed to report the accident, then you will have to compensate the other insurance company.
Does Reporting an Accident or Making a Report Increase Insurance Rates?
As you are probably suspecting, in case you or another driver files a claim against your policy, and you are found to have been at fault, then it is highly likely that you will note an increase in your premiums. This will also happen if your insurance company has to compensate the other insurance company due to damages caused in an accident which you caused.
You won’t experience an increase in your premiums automatically in case the other driver is found to have been at fault, and you make a claim as stipulated in your contract. The bottom line is you’re responsible for reporting any accident to your insurer if the accident falls under your cover. Other than the contract obligations, failing to report an accident can lead to serious financial repercussions.