Filing an Auto Insurance Claim (A Complete Guide)
In many cases, filing an auto insurance claim can be done online. Knowing how to file an auto insurance claim against someone could save you thousands. Auto claims typically pay out between $14,000 and $28,000.
Free Auto Insurance Comparison
Secured with SHA-256 Encryption
UPDATED: Oct 30, 2020
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
|Auto Insurance Claim Data||Dollar Amount|
|Average liability claim for property damage||$3,638|
|Average liability claim for bodily injury||$15,270|
|Average auto insurance rate increase after an at-fault accident||$1,000|
After an accident, filing an auto insurance claim can be overwhelming. Going through the auto insurance claims process for the first time can be exhausting. How do you know what to file for? What information do you need? What if your car insurance company denies your claims or raises your rates? Is it worth filling an auto insurance claim? Absolutely, but you need to know what to do.
Not knowing how to file an auto insurance claim or not being prepared for claim issues can make the process even worse. Accidents are more common than we’d like, and one is bound to happen to you eventually.
The National Highway Traffic Safety Administration states that 2010 saw 5.14 million automobile crashes. Almost 33,000 people lost their lives, while 2.4 million were injured.
In addition, according to the Insurance Information Institute (III), insurance companies pay more than $150 billion each year in claims. A large percentage of these claims are a direct result of auto accidents.
If you’re looking for answers on how to file a claim, this guide is for you. To help you through the auto insurance claim process, we’ll cover everything from the basics of claims to claims’ effect on rates.
So if you’re wondering if you should file a claim or how to file a claim, keep reading.
Want to start comparison shopping today? Enter your ZIP code in our free online tool above.
The Basics of Car Insurance Claims
Before we get into some of the problems that can arise when making a claim, we want to start by looking at the basics of claims. You’ll need to know which driver is supposed to file a claim, what types of claims there are, and if you should even file a claim.
If you don’t, you could make a mistake and file for the wrong thing or file for something that would be better left off the record. So let’s get started on the basics of car insurance claims.
How do companies determine fault in claims?
The first thing you’ll need to know is if your state is an at-fault or no-fault state. Why? Because this is how auto insurance companies determine fault in claims.
- If you live in a no-fault state, you’re responsible for paying your own accident bills, even if the other driver caused the accident.
- If you live in an at-fault state, the driver who caused the accident is responsible for the other driver’s bills and their own.
As you can imagine, determining fault in at-fault states can be a little tricky. Insurance companies work to determine which driver is more at fault, and drivers must pay accordingly.
You may find that the insurer has declared that you were only partially at fault for the accident. If you get a letter saying you’re 25 percent at-fault and the other driver was 75 percent to blame, it’s considered a not-at-fault accident on your end.
It’s a bit shocking to see that some fault has been allocated to you, but this is a normal practice. In the eyes of the insurance company, both parties play a part in a collision most of the time.
There are rare instances when it’s hard to allocate any fault to the victim, such as when a driver is stopped at a light or parked legally.
In other instances, drivers who could have swerved or attempted to avoid the collision may play a small role in the outcome.
If you aren’t at fault but you’re found to play a role in the outcome of the accident, what happens to the claim depends on the state you live in.
Some states have comparative negligence rules, while others have contributory negligence rules. If you live in a comparative negligence state, your claim’s settlement would be reduced based on the percentage you’re at fault.
It’s not just one insurer who determines which driver is at fault for a loss. Both car insurance adjusters work together as they are investigating a claim to compare information and to exchange their findings.
Ultimately, in the end, the adjusters will present their information and eventually agree on a fault allocation.
What are the types of car insurance claims?
There are two main types of car insurance claims — property damage claims and bodily injury claims.
Keep reading to learn more about what each type entails and what’s covered under each claim.
Property Damage Claims
One of the most common types of claims is property damage claims. These claims can cover a wide range of scenarios, but if your vehicle is damaged, you’ll file a claim under property damage.
This claim type works in both at-fault and no-fault states. Below are a few examples of when you would file under property damage.
- Another driver ran into your car in the parking lot, leaving a big dent
- You rear-end another driver, ruining both your car and theirs
- You back into a mailbox, crushing your bumper
If you damage your car, you would choose property damage claims.
Bodily Injury Claims
Whenever you or another driver or passenger is injured and requires treatment, claims will be filed under bodily injury. What are the most common types of injuries that most people file for?
Take a look at the list below.
- Whiplash — It’s often the butt of jokes in the movies, but whiplash can involve some serious medical costs. A whiplash collision claim is especially common since it only requires a jerking neck motion.
- Back Injuries — Back injuries are the next most common type of injury claim in an auto accident, after whiplash. Back injuries can range from something as simple as a strained back muscle to something more severe, such as a slipped disk.
These are some of the more minor injuries that drivers can suffer as a result of minor crashes. Any injury that requires medical treatment after an accident can be filed under bodily injury.
What types of damages can you file a claim for?
There are many different types of auto insurance coverage to pick from, and each one covers a different range of claims. From animal collisions to hit-and-run accidents, we’ll cover what damages are covered by each type of car insurance.
Comprehensive Coverage Damages
If your car is vandalized overnight, or rocks flying from a construction truck crack your windshield, you’re dealing with a comprehensive claim. To cover damages to your vehicle that are caused when you’re not behind the wheel, you’ll need to add optional comprehensive coverage.
Comprehensive, also known as comp, pays for accidental damage to the covered auto as a result of scenarios that are out of your control.
Below is a full list of what situations you can file claims for under comprehensive coverage.
- Stolen vehicle
- Glass damage
- Accidents when hitting a dog
- Hail damage
- Falling objects
If you run into a deer or have your tires stolen, you can file these damages under comprehensive coverage. We want to point out that comprehensive coverage is only for your own vehicle, not for third parties.
Collision Coverage Damages
Collision, on the other hand, pays when your covered vehicle collides with a car or other types of objects or real property. So if you run into another car or a tree, you would file under collision.
People often confuse collision with comprehensive. Just remember that collision is for accidents with other vehicles and property. When your car is keyed or when neighborhood kids throw eggs at it as a prank, the damage will be covered under comprehensive.
Unfortunately, when the vehicle is being driven, there’s often more to it than just straightforward facts.
Let’s say you’re driving your vehicle in heavy traffic. You swerve to miss a stopped vehicle ahead and just miss a tree. Unfortunately, another vehicle behind you hits that tree and it falls on your hood.
Since a falling object caused the damage, it’s a comprehensive claim. If you yourself would’ve hit the tree and the tree fall on the car, it would be a collision claim because the collision led to the falling object.
Liability Coverage Damages
Liability coverages are to protect you if you cause an accident. Generally, you won’t have to file a claim, as the other driver will be filing against you.
This coverage will provide coverage for both property damage and bodily injuries.
So if you cause an accident that gives other drivers whiplash or ruins the bumpers on their cars, liability coverage will cover their costs.
Personal Injury Protection & Medpay Damages
Both of these coverages protect for damages caused to you and your passengers, regardless of who caused the accident.
Personal injury protection (PIP) generally covers more bills, as it compensates drivers for injury treatment and any lost wages, where MedPay only covers medical bills.
So what claims might these coverages cover?
- If you get in a car wreck and are fine, but your friend in the passenger seat is suffering from a head injury.
- If you break your leg in a car crash and can’t work for a month.
Bottom line? If the damage occurs to you or your passengers, file for damages under PIP or MedPay (depending on which you have).
Should I file a claim?
It’s one thing to know what damages your insurance covers, and another thing to know if the damage is even worth filing for. A number of claims can actually end up raising your rates, making it more economical to pay out of pocket.
In this section, we are going to go over the main factors you should consider before filing a claim.
Consider Car Ownership
Do you own the vehicle, or were you borrowing it from a friend? In this case, you’ll probably end up using your own insurance to pay other drivers’ costs (if you were at fault), and your friend’s insurance will be used to repair the car. There are also cases where you may own both cars.
For example, you back into your other car while pulling out of the driveway. If you chose to file, you’ll have to consider if the cost of the repairs for both vehicles will be more than the increases in rates and lost discounts (such as accident forgiveness).
Bottom line? If you own the vehicle and the costs of repairs are high, you should file a claim.
Consider Car Insurance Deductibles
A deductible is how much you have to pay out of pocket after an accident before your insurer steps in and pays the rest.
The Insurance Information Institute (III) explains deductibles this way: “If your policy states a $500 deductible, and your insurer has determined that you have an insured loss worth $10,000, you would receive a claims check for $9,500.”
This is why it’s crucial to gauge the cost of repairs before submitting a claim. For example, if you have a $1,000 deductible and cause an accident that results in repair costs of $500, it’s not worth filing a claim
You’ll end up paying for the repairs yourself anyway, and your insurer will raise your rates because it was an at-fault accident.
Consider if the cost of damages will be under your deductible limit.
Consider the Amount of Damage
You sign up for insurance so that you can protect your assets and safeguard yourself against losses. However, that doesn’t mean you should file a claim for every little scratch on your car.
When it comes to simple property damage and smaller issues, it may be better to just pay for the repair on your own. After all, when you file the claim, you’ll have to cover the deductible. If the damage is small, your insurer may not even cover it.
Look at the cost of the repair after your deductible is covered. In some cases, you may decide that a modest increase is well worth it to have insurance cover a costly repair.
However, there are times when you’re better off just paying for the damage on your own and avoiding the claim:
- Moving violations are on the record
- The repair is just a little more than your deductible
- The repair is less than your deductible
If the minor damage, such as scratches or dents, is the result of a motor vehicle accident, then you may be legally required to file a report on the accident. States set the reporting requirements based on a range of criteria, including whether there was an injury and the amount of property damage.
If your minor damage is the result of an accident, you’ll want to check the state reporting requirements. If it’s from a parking lot or vandals, then the choice will still be up to you.
Free Auto Insurance Comparison
Enter your ZIP code below to view companies that have cheap auto insurance rates.
Secured with SHA-256 Encryption
How to File an Auto Insurance Claim Against Someone
Now that you know the basics of what damages are covered under claims and when you should make a claim, we’re going to dive into the process of making a claim.
This way, you can be prepared before you get into an accident. If you aren’t aware of what information you need to collect and how to submit a claim, you could make a mistake that costs you.
So stick with us as we go through must-know information on how to collect information after an accident, how to file an insurance claim if someone hit your car, and how to submit it to your insurer.
What steps should I take after an accident?
This is the most important thing you can prepare yourself for. Emotions are usually running high after an accident, but don’t let the other driver bully you or drive off without collecting information and witnesses.
If you aren’t sure what steps to take after an accident, take a look at the important do’s and don’t’s below.
What to Do at the Scene of an Accident
If you can, drive your car carefully to the shoulder. Call 911 and medical services if there are any injuries. Don’t move the injured people unless you’re trying to get them out of harm’s way.
Protect the accident site and your car by setting up flares around any glass or damaged parts on the road. Call the tow truck to move your car but make sure that you get an appraisal from your insurance company before committing to any repair shop.
Make notes of the accident site and the people involved. Get their names, license numbers, insurance information, make and model of each car involved.
In addition, get the names and badge number of the attending police and medical personnel, as well as the names and contact information of any witnesses.
If your cell phone has a camera, take pictures of the accident scene if possible. Record the damage to all vehicles involved. Give the police all the required details and make sure you get a copy of the police report, which will be required for any insurance claims you make.
Then call your insurance company or insurance agent as soon as possible, regardless of fault. Ask them for clear directions about how to proceed.
Make sure you understand what forms are needed as well as supporting documents such as medical and auto repair bills.
Work with your insurance company and make sure you give them all the information they need, including any legal papers you receive from the other party. Your insurance company will defend you in case someone sues you, or a claim is brought against you.
Furthermore, keep a record of all your expenses that were incurred because of the accident. From the police report to all your repair bills, as well as evidence of lost wages, home care, and medical/hospital expenses, you should keep copies in case they’re needed later.
What Not to Do at the Scene of an Accident
Don’t settle at the accident site. If the driver of the other car wants to settle accounts and pay you cash on the spot, don’t take their money.
They probably don’t want to get the authorities involved. This could lead to trouble later if you find extensive damage that costs more than you were given at the accident site. Without a police report, you’ll have no recourse.
Don’t avoid making a claim. Unless the damage in the accident is minimal, you must make a claim. While this might take away your no-accident discount and put a mark on your claim record, you must be totally honest with your insurance company. This will work well for you in the long run.
What are the ways to submit a claim?
Once you’ve collected the necessary information, there are usually multiple ways to file a claim.
- App — If you have your insurer’s general app, most apps allow customers to file claims from their smartphones.
- In-person—If you have a local agent, you can visit them in person to file a claim.
- Online — You can usually sign into your account and file a claim online.
- Phone — Most insurers have a direct line for filing claims. If not, you can call general customer service.
You should always file with your own insurer, even if you aren’t at fault. The last thing you want is to slip up and be questioned about the accident in a way that makes it seem like it’s your fault. Your insurer will contact the at-fault driver’s insurer to handle the claim.
Filing if You’re at Fault
When you’re at fault for damages to your vehicle, it doesn’t change the fact that you need to get your vehicle repaired or replaced. When you’re involved in an accident with another driver, one of the first steps is determining fault for the accident.
Even before the fault determination is made, you can still file a claim with your insurance provider.
If you’re determined to be the at-fault party in the incident, your insurance provider should still help you recover from the loss.
During the claim process, your insurance provider will look at your coverage to determine what options you have for your claim. Your vehicle may be protected in many situations, if you carry a policy with a variety of coverage options, such as:
- Glass coverage for broken car windows
If you only have minimal coverage on your policy, then your vehicle may not be protected in the event of the loss.
Every insurance provider is different, meaning that your provider may have other rules or guidelines in place for how they handle claims and deductibles.
If you have questions about how your provider handles these types of incidents, be sure to speak with them before a loss occurs.
Filing a Claim if You Aren’t At Fault
Being not at fault for a collision typically means the other party’s insurance company will pay for your repair bills and your medical bills as long as the amount is below the driver’s third-party liability limits.
While you can call the other company to file your claim, it’s best to avoid doing this because you can easily make a statement that will affect how much you’re compensated and how quickly the claim is processed.
Though you’re filing your claim through your carrier, it will still proceed as the at-fault driver’s company.
You will give your insurer all of the information they request, and then the claims adjuster will help guide you through the process.
Even better, the adjuster will contact the other carrier to initiate the claim and share statements so the fault can officially be allocated.
Just make sure you file if you’re not at fault, as you don’t have to worry about deductibles and raised insurance rates.
Common Claim Scenarios
You may be wondering what common situations happen when you go to file a claim. To help prepare you for what scenarios you may face, we’re going to go through some common questions about claim scenarios.
From police reports to uninsured drivers, it’s all covered here.
Should I file a police report?
If you discover your car has been stolen, call the police immediately. The sooner they begin investigating, the better chance you have of getting your car back. A police report must be filed for any investigation to begin.
If you’re in an accident and anyone is injured, call 911 immediately. If no one is injured, call the non-emergency number for the police.
It’s a good idea to have it programmed into your cell phone. If you plan to file a claim for stolen cars or serious accidents, you need to have a police report on file.
After the police have made a report about the accident, get a copy. If this is not available to you at the accident scene, you may get a copy from the courthouse within a few days.
Accident reports are public record and are available to anyone for a small fee.
How long do I have to file a claim?
After an accident, you only have a certain amount of time to file a claim or a lawsuit. This amount of time is known as a statute of limitations.
Not sure what the statute of limitations is in your state? Check out our list below.
|State||Personal Injury||Property Damage|
|Alabama||2 years||2 years|
|Alaska||2 years||6 years|
|Arizona||2 years||2 years|
|Arkansas||3 years||3 years|
|California||2 years||3 years|
|Colorado||3 years||3 years|
|Connecticut||2 years||3 years|
|Delaware||2 years||2 years|
|Florida||4 years||4 years|
|Georgia||2 years||4 years|
|Hawaii||2 years||2 years|
|Idaho||2 years||3 years|
|Illinois||2-3 years||5 years|
|Indiana||2 years||2 years|
|Iowa||2 years||5 years|
|Kansas||1 year||2 years|
|Kentucky||1 year||2 years|
|Louisiana||1 year||1 year|
|Maine||6 years||6 years|
|Maryland||3 years||3 years|
|Massachusetts||3 years||3 years|
|Michigan||3 years||3 years|
|Minnesota||2 years||6 years|
|Mississippi||3 years||3 years|
|Missouri||5 years||5 years|
|Montana||3 years||2 years|
|Nebraska||4 years||4 years|
|Nevada||2 years||3 years|
|New Hampshire||3 years||3 years|
|New Jersey||2 years||6 years|
|New Mexico||3 years||4 years|
|New York||3 years||3 years|
|North Carolina||3 years||3 years|
|North Dakota||6 years||6 years|
|Ohio||2 years||2 years|
|Oklahoma||2 years||2 years|
|Oregon||2 years||6 years|
|Pennsylvania||2 years||2 years|
|Rhode Island||3 years||10 years|
|South Carolina||3 years||3 years|
|South Dakota||3 years||6 years|
|Tennessee||1 year||3 years|
|Texas||2 years||2 years|
|Utah||4 years||3 years|
|Vermont||3 years||3 years|
|Virginia||2 years||5 years|
|Washington||3 years||3 years|
|Washington D.C.||3 years||3 years|
|West Virginia||2 years||2 years|
|Wisconsin||3 years||3 years|
|Wyoming||4 years||4 years|
The clock starts ticking the day of your accident, so don’t wait too long to file a claim or bring a lawsuit against the other driver.
What if I am uninsured or underinsured?
If you’re uninsured, you’re breaking the law. If you’re in an accident or pulled over while uninsured and can’t provide proof of insurance, you’ll face multiple penalties, including:
- License revocation
- Registration suspension
- Reinstatement fees for license, registration, and license plates
The fees and penalties grow worse if it’s not your first offense. You may have to purchase high-risk insurance if you drive without insurance. At the very least, you’ll have high rates at whatever insurer you go with.
So what happens if you’re in an accident while underinsured?
Well, if you live in an at-fault state and the other driver caused the accident, their insurance will cover you. The danger of this is that if the other driver is underinsured or uninsured themselves, your underinsured insurance won’t be able to cover you.
If you live in a no-fault state or you caused the accident, your insurance likely won’t cover the cost of the accident. This means that you could be stuck paying the majority of the bill yourself.
The bottom line? Being in an accident while uninsured or underinsured is never a good thing. You face the possibility of paying much more than you would have paid for better coverage.
What if the other party is uninsured or underinsured?
If you have uninsured and underinsured coverage, you are good to go. Your insurer will cover the costs that the other driver can’t cover.
However, if the other party caused the accident and you live in an at-fault state, you will be stuck with the bill if you don’t have uninsured and underinsured coverage.
To make a claim when the other driver is uninsured, you need to file as soon as possible. When should you file an uninsured claim?
- The other driver explicitly says he or she doesn’t have car insurance
- The other driver refuses to give your their insurer name and number
These are clear red flags that a driver doesn’t have insurance. So if you can’t get the other driver’s information when they clearly caused the accident, you need to file an uninsured claim.
As for underinsured claims, these take a little longer to process, as it’s a back-and-forth between their insurer and yours. Make sure to file as soon as possible to get the process started.
Free Auto Insurance Comparison
Enter your ZIP code below to view companies that have cheap auto insurance rates.
Secured with SHA-256 Encryption
What happens if my car is totaled?
Is your car in the junkyard after an accident? If so, you’re probably wondering who’s going to pay to replace your car. If you’re in an at-fault state and the other driver caused the accident, their insurance will cover the costs.
However, the tricky thing with this is that the other driver’s coverage may not completely cover your costs. In this case, your own collision coverage will cover the rest that the other driver’s insurance can’t cover.
But what if your total loss claim to your insurer doesn’t completely cover the cost of the car you still owe money on?
This is where it pays to have GAP insurance. If you have a new car that you’re paying loans on, gap coverage will pay the difference between the actual value of your car and what you still have left on your loan.
So if you have a new loan on your car for $15,000, but the day it’s totaled it’s worth only $10,000, gap coverage will pay the remaining $5,000. This way, you don’t have to still pay a loan on a car that no longer exists.
Some companies will also offer new car coverage, where if your new car is totaled, they will replace it with a car that is a similar make and model, if not the exact same.
Of course, you’ll have to pay extra for these coverages, but they are more than worth it in the case of an accident.
How do I choose a repair shop?
After an accident, you’ll need to focus on getting your vehicle repaired. Some insurers will have a list of pre-approved repair shops they want you to take your vehicle to, while others will let you choose any repair shop you want.
If it’s your own insurer, you should be able to pick whatever repair shop you want. If it’s the other driver’s insurer paying for repairs, you may have to go with a pre-approved shop.
Talk to your insurer to see what their requirements are. As well, ask if they use aftermarket or new parts to repair vehicles. Most states have laws detailing that if insurers use aftermarket parts, they must be of the same make and quality as the original part.
As well, most people don’t realize that when the insurer gives them money to repair their car, they have the option of putting the money toward repairs or putting it in their pocket for something else. This is where it pays to shop around.
If an insurer gave you $700 to repair your vehicle, and one shop only charges $500 for repairs, you can spend the remaining $200 on whatever you want.
Car Insurance Claim Denials & Appeals
The worst thing that can happen after an accident is your claim being denied. If you aren’t sure how to proceed after your insurer says they won’t cover your claim, keep reading.
In this section, we’ll cover why claims are denied, as well as how to appeal them. Let’s get started on what to do in the unfortunate event your insurer says no.
What if my claim is denied?
A claim denial can leave you feeling confused and panicked, as you now have to pay for everything yourself. Why are claims denied?
Below are some of the most common reasons why companies may refuse a customer’s claim.
- You could have avoided the accident. For example, you got into an accident while driving drunk, which is totally avoidable if you had just taken a cab instead of driving.
- You didn’t get your injury treated right away. If you don’t go to a hospital or doctor right after an accident, insurers may think you are faking your injury when you file a claim.
- Medical records don’t state an injury. If you don’t have medical records proving you had an injury or pain, you have no proof to back up your claim.
- You had a pre-existing condition. If your back was already bad before the accident, it’s going to be hard to prove that the accident made the slipped disk in your back worse.
- You have poor coverage. Your policy may not cover you. For example, if you don’t have comprehensive coverage and hit a deer, your insurer won’t cover you.
Now that you know the reasons why claims are denied, let’s see what steps you should take.
What should I do if my claim is denied?
The first thing you need to do is find out why your insurer denied your claim. They need to have a legitimate reason to do so.
If not, they’re breaking the contract between customer and insurer.
Your insurance carrier agrees to provide you with certain types and forms of coverage while you agree to pay them a certain amount of money. As with any legally binding contract, if either party violates its terms, they open themselves up to legal action.
To understand what bad faith means in a legal sense, understand that when we enter into binding contracts, we are agreeing to do whatever is necessary to fulfill our end of that contract.
Bad faith is a scenario in which one party does not uphold the contract, thus injuring the other party. Regarding car insurance, bad faith can be demonstrated in any number of ways. We’ll use accident investigations as an example.
When you make auto insurance claims against your policy, the company has a fiduciary responsibility to investigate thoroughly the circumstances surrounding the claim to determine payment.
As the other party in the contract, your insurance company is required to do everything within their power to investigate an accident properly so that you’re treated fairly. If they fail to do so, that could be construed by a court as bad faith.
Of course, there may also be a case where there has been a direct breach of contract.
Breach of contract is a lot more black-and-white and much easier to prove in court. Where bad faith requires the best judgment of the court system, breach of contract simply requires the black-and-white text of the agreement.
If your insurance company promises to cover all glass replacement, a failure to do so under any circumstances is a breach of contract. Make sure to keep records of all emails and conversations between you and your insurer.
If we combine our previous examples of accident investigation and full glass coverage, a combination of bad faith and breach of contract might mean an insurance company refuses to pay a glass replacement while assuming, without verifying, that your glass is not really damaged.
Can you sue your own car insurance company for denying your claim?
Absolutely. All states allow customers (and insurers) to sue for breach of contract. A majority of states also allow you to sue for bad faith. However, taking auto insurance companies to court may not be easy.
While you can proceed against the insurance company on your own, it is never recommended. The insurance company is sure to have its own legal representation.
If the company is large, it may even have several attorneys handling the matter. This puts you at a disadvantage unless you’re an expert in the field of insurance law, contract review, and litigation.
Further, legal counsel can help you with the additional preliminary steps. If you decide to proceed on your own, though, you should at least be aware of certain pitfalls.
One particular concern is whether you followed the terms of the agreement in the first place. Insurance companies may avoid liability by asserting that you were the one in breach.
If the contract required you to file a claim within a certain time and you failed to do so, the company may be able to avoid having to pay for your claim.
Likewise, state laws have statutes of limitation to file a claim. If you file your claim against the company outside of the relevant statute of limitations, you may be barred from recovering, even if the insurance company is actually at fault.
Settlements can be advantageous for both parties: it avoids a drawn-out legal battle, and it provides compensation to the policyholder.
Settling with the insurance company can also be a pitfall. Often, companies offer the policyholder a settlement.
However, it’s not uncommon for the company to lowball the settlement amount. Unless you have apt negotiation skills, it’s easy to fall victim to an inadequate settlement.
Steps to Take When Suing
The first thing you should do is consult an attorney. Many attorneys specialize in cases involving auto accidents and insurance claims.
You should consult with an attorney about any claim you have against your auto insurance company before you sue a car insurance company for bad faith.
If you decide to proceed to court without an attorney, following the steps below will increase your chances of winning a case against your insurance company in court.
Make a demand.
If you haven’t received a specific written offer of payment from your auto insurance company, you can make your own demand before proceeding to court.
If you aren’t able to reach a resolution of your claim through discussion, then you will need to decide whether to take your claim to court.
While it is difficult and time-consuming to present a case in court without an attorney, many people are successfully able to do so.
If you decide to take your auto insurance company to court on your own behalf, you must be aware that it is a serious matter that will take time and work on your part.
Thorough and accurate documentation is the best way to prove your case in court.
Any time you’re involved in an accident or believe that your automobile has suffered damage covered by your insurance policy, you should get copies of:
- Your insurance policy
- Any accident report generated by law enforcement
- Insurance and driver’s license contact information from any other parties involved
- Any correspondence or documentation received from your auto insurance company
- Medical reports and billing information for any medical consultations or treatment received
- Damage repair estimates and bills
- Any documentation concerning lost work, wages, or income as a result of the accident
Prepare your case for court.
Even if you have obtained and organized all of your documentation as described above, you should again consider whether you will need an attorney’s help.
In some small claims courts, an attorney will not be allowed in the courtroom. However, you can use the services of an attorney to help you prepare the case before you get to court.
You’ll need to submit a complaint form to the court that handles cases in the amount that you are seeking.
You can learn the jurisdictional limits of small claims courts and city courts by consulting the local government website or visiting the local courthouse.
You’ll need to review and follow all procedures applicable to the particular court in which you file your claim.
You’ll also need to serve a copy of any complaint or claim form to the insurance company. The local court rules will provide how that service is to be made.
Before your court date, you should prepare a narrative statement setting forth a chronology of everything that has happened relating to your insurance policy claim.
Organize and index all of the documentation discussed above, and contact any witnesses and make sure that they’re willing to attend the court date.
You must appear for your court date on time with all of your documentation, testimony, and witnesses prepared.
If there’s no settlement of your case, you’ll need to present your case to the judge or jury and explain your damages and injuries. Both sides will have an opportunity to make their case.
You can settle a case or claim against your auto insurance company at any time before your court date or even on the day you are to be in court.
Insurance companies will often not settle a case until just before a trial.
There are many reasons why insurance companies take this approach to delaying settlement, but be aware that you may receive an acceptable offer to resolve your claim on the courthouse steps.
Any settlement of a claim between you and your auto insurance company will be outlined in a specific written document.
Even if you haven’t consulted an attorney to represent you thus far in the process, you may still wish to contact an attorney to review such a document.
If you do take your insurance company to court and there’s no settlement of your claim, either you or the company will have the right to appeal any court judgment or jury verdict.
You’ll have to follow strict court rules if you wish to appeal.
Winning in court can be a lot of work and time-consuming. It’s not something to be taken lightly and can be avoided altogether by choosing a reliable company that will handle your claims.
Can my insurer drop me for filing a claim?
Yes, unfortunately, insurers can drop you for filing a claim. In general, car insurance companies can opt to cancel an insurance policy if you’ve committed any of the following infractions.
- You’ve filed too many claims over a certain period of time. Car insurance companies tend to have a threshold for accidents and incidents. If you get into more accidents than your car insurance company allows, they may determine that you aren’t worth the future risk.
- Your car accident pushed you into the high-risk category. If you’ve gotten numerous speeding tickets or driving infractions over the last couple of years and then get into a car accident, you may be deemed a high-risk driver and your insurance company may not be able to write high-risk policies.
- You were impaired at the time of the accident. If you were drinking and driving or under the influence of drugs at the time of the accident, your insurance company may cancel your coverage.
If a car insurance company wants to cancel your insurance policy, they must follow certain steps. Otherwise, you may have a reason to report them to your state’s insurance department.
Your car insurance company must send you a letter explaining that they’ve decided to cancel your insurance policy, and they must provide one or more reasons. The letter must also state the cancellation date.
If your car insurance company cancels your policy without notifying you or they don’t provide a reason, they could be required by law to reinstate your policy. However, it depends on why your policy was canceled.
If you failed to pay the premiums or were convicted of a crime while driving, you may not have any recourse of action.
If you can’t get your policy reinstated, you can use a comparison tool to quickly find and purchase a new auto insurance policy and avoid a gap in your car insurance coverage.
What do I do if I want to appeal my claim?
To begin the process of disputing a denied claim or a too-low settlement, you must submit your argument to the insurance company in writing.
You can begin this process without an attorney, but a lawyer can be extremely helpful in persuading an insurance company to pay more than they are willing to offer.
If you believe your claim should be covered under your policy, you must prove why to your insurance company. To do this, you must gather all of the relevant documents — police reports, pictures of the vehicles, insurance documents, hospital bills, and repair estimates, for example.
You or your lawyer will explain to the company why each piece of your evidence refutes the adjuster’s decision.
A well-supported appeal case has an excellent chance of being approved or negotiated for a better settlement.
In cases of permanent injuries or significant property damage, consult with an attorney before negotiating with your carrier.
Additionally, if you feel the insurance carrier improperly denied your claim or is negotiating in bad faith, an attorney can be helpful. Bad faith practices generally require complaints to your state insurance commissioner, aggressive settlement negotiations, or lawsuits.
Having an insurance claim denied after a car accident can be frustrating, but that doesn’t mean you simply end negotiations and take the loss.
You do have options to pursue the money that you feel is rightfully owed to pay for your injuries and damages, and being persistent ensures you’ll get a fair settlement.
Hopefully, your insurance company is reasonable and will work with you to make sure that you are satisfied with the outcome. If not, be sure to compare insurance companies and their claims ratings to find one that will serve you better in the future.
Free Auto Insurance Comparison
Enter your ZIP code below to view companies that have cheap auto insurance rates.
Secured with SHA-256 Encryption
Canceling a Car Insurance Claim
If talk of being dropped makes you nervous, you may be wondering if you should cancel your car insurance claim. This is an important decision to make, and you should make sure you are absolutely certain before you cancel your claim.
If you need guidance on if you should cancel your claim and how to cancel, keep reading.
Should I cancel my car insurance claim?
If you’re debating whether you should cancel your claim, it may help to refer back to our section on filing your claim. As a refresher, though, here are some of the reasons you shouldn’t file a claim.
- Consider car ownership, such as if you crashed into your own car.
- Consider your deductible. If the cost of repairs is less than your deductible, it’s better to pay out of pocket.
- Consider the damages. If it’s just a scratch or dent, it’s not worth filing a claim over.
If your claim meets any of these situations, you may want to consider canceling your claim.
How do I cancel my car insurance claim?
You can cancel your claim simply by calling your insurer. However, while your insurer will cancel your claim, the claim will still stay on your record.
This could affect discounts, such as good driver discounts and accident-free discounts. So it’s best to fully consider filing a policy before you file. Canceling a claim doesn’t erase it from your record.
What if my insurer doesn’t accept my cancellation?
An insurer will not accept cancellations for the following situations:
- The claim is filed by another party
- You were at fault
If you caused the accident, insurers won’t drop the claim. This means that if you switch insurers before the claim is paid, you will still have an open claim at your old insurer.
However, many states have regulations in place that identify how quickly insurance companies need to settle claims. Some states are very specific, while others say “in a reasonable amount of time.” As for what reasonable means, room is left for interpretation.
You’ll want to identify the rules and regulations within your state. The Department of Insurance will provide you with all the specifics.
This information will help you to stay on top of the insurance company and ensure they are handling your insurance claim quickly. If you have done all of your due diligence filing a claim on time and the insurance company hasn’t closed the claim, you have the option of taking action.
Particularly if you have a car that is not in driving condition or you have medical bills adding up, you want the claim settled quickly.
Insurance companies are required to communicate the status of the claim to you. This communication might be done by email or by written communication that is mailed to you. Either way, you should always know where you are at with the claims process.
There should also be a person assigned to your case so you can get updates.
This contact allows you to check on such things as:
- When you can get repairs scheduled
- When bills will be paid
- When the claim will close
If you’re in a state where there are specific time regulations, you’ll be able to use the communication to determine whether the insurance company has exceeded these time frames.
Whether the insurance company has gone past the timelines or they are not communicating with you, you can file a complaint.
Car Insurance Fraud & Claims
You may be wondering why insurers are so strict about claim filing and why they deny claims. Fraud is a big part of why it’s important to be detailed and thorough on claims. Otherwise, insurers may flag your claim as fraudulent and deny it.
After all, insurers need to make a profit, but they lose a significant sum each year due to fraud. Fraud can also happen to you. To make sure you aren’t a victim of fraud and that you don’t commit a fraudulent claim, read on.
How do drivers become a victim of fraud after an accident?
You’re driving down the road, and you find yourself behind a car filled with passengers. Another car is driving in the lane next to you when it suddenly pulls forward and switches lanes, cutting off the vehicle in front of you.
That car’s driver slams on the brakes, bringing the car to a sudden stop and suddenly, you’re ramming into the back of it.
The third car that cut everyone off speeds away, and you and the other car’s driver are left to assess the damages.
When the police arrive, you try to explain about the third car, but it’s nowhere to be found. Because you’re the one who rear-ended the other car, it looks like you’re the one at fault.
On top of that, the passengers in the vehicle you hit are now complaining of injuries, and they’re blaming you. The cop asks if you have car insurance, and you realize you’re in big trouble.
But guess what? Everything about that accident was staged. You’ve just become the latest victim of auto insurance fraud.
The above tactic is known in the insurance industry as a “swoop and squat.” The two cars were working in tandem to cause a collision to make it seem like it was your fault.
The car that suddenly cuts or swoops into the lane is called the swoop car. The car that is hit is called the squat car.
The scammers purposely load up the squat car so they can file numerous medical claims against your insurance, sometimes receiving tens of thousands of dollars for each person supposedly injured in the accident.
A variation of this scenario is called a “panic stop.” Again, the car planning to be hit is full of passengers. The car will pull into a lane in front of you, and then one of the passengers is assigned the task of watching for a moment of distraction.
As you’re driving behind the vehicle, all it takes is a moment to adjust the stereo, answer your phone, or turn your head to talk to another passenger in your car.
The lookout gives the driver a signal that your attention is diverted, and the driver slams on the brakes, causing you to rear-end the full car.
Once again, every passenger will feign injuries of varying degrees, and it’s you who will foot the bill.
How do I avoid being a victim of fraud after an accident?
So how do you avoid being a victim of fraud? Make sure you follow the steps below.
Collect as Much Information as You Can
You’ll want to get their driver’s license number and their auto insurance card. Get the names of all of the people involved in the accident, and try to take some pictures of the damage to each of the vehicles.
You’ll also want to get a name, address, and phone number of all of the people in the other car.
Document the Consequences of the Accident
Get detailed pictures of the damage to each vehicle. You want to avoid a situation where the other party damages the vehicle after the fact and tries to blame it on your accident.
Call the Police
Whenever there’s an accident, the best thing you can do is to make sure it’s documented by the local authorities.
Get a copy of the police report from the officer on the scene, or follow whatever procedure your state or locality has for getting a copy.
Make sure you get the officer’s name, preferably on a business card or other official piece of paperwork.
Watch Out for Ambulance Chasers
If there are people who suddenly appear to try to point you toward a doctor, attorney, tow truck, or mechanic, be careful. You might be the victim of a setup.
Treat Paperwork Carefully
Ask for detailed bills for any services you get, including repair bills or medical services bills. If you must file a claim, treat that paperwork carefully.
Auto insurance claims can be handled in a number of ways, including filing a claim online.
Never, ever, sign a blank claim form. This can be used against you when the time comes to try to collect damages or insurance payments.
How do customers commit auto insurance fraud?
With such strict laws against auto insurance fraud, make sure you aren’t committing fraud yourself. According to the Insurance Information Institute (III), customer fraud can be committed in the following ways.
- Faking an accident
- Adding extra, false costs onto a legitimate claim
- Filing for damages and injuries that never happened
Any lie, no matter how small, is insurance fraud. If insurers find out, you can be prosecuted in a court of law.
Will fraud ruin my claim settlement?
If you commit fraud on your claim and your insurer finds out, you will not only lose your claim but also face legal repercussions.
However, even if your claim is squeaky clean and valid, others’ insurance fraud can still hurt your claim settlement. If a company is struggling with losses from fraud, your claim settlement may not be as much as you’d hoped for.
So make sure a company has a good loss ratio before you sign up with it.
A loss ratio is simply the amount of claims paid relevant to how much a company earns in written premiums.
You want to make sure a company is earning enough to pay out claims. So check loss ratios and other financial indicators/reviews before committing to a company.
How Car Insurance Claims Affect Rates
When you make a claim, there is always the risk of your claims going up. The claims also stay on your record, so you need to consider if the claim is worth the payout before you call your company.
If you’re wondering how much a claim will affect your rates, keep reading. We’ll cover why rates go up to what happens if you don’t report an accident.
Why might my rates go up after filing a claim?
The Insurance Information Institute (III) says the main reason rates go up after claim filing is if the accident is mostly your fault. These increases in rates will probably stay on your premium for three years.
So if you are at fault for an accident, you can expect your rates to go up. If you are blameless, your rates shouldn’t go up.
What are the best companies for drivers who have filed an at-fault claim?
If your rates go up after filing an at-fault claim, make sure you aren’t paying exorbitant rates for auto insurance. Below, you can see data from Quadrant on how much prices increase from a clean record after an at-fault accident.
|Companies||Clean record||With one accident||Amount of Annual Auto Insurance Increase|
As you can see, some companies charge more than others for an at-fault accident. Liberty Mutual has the highest price increase at $1,430, while State Farm charges the least at $574.
So if your rates go up too high after an accident, consider switching to a company with lower rates.
Tips for Lowering Your Rates After Filing a Claim
If you have a good driving record, you may qualify for accident forgiveness at your insurer. This a great way to make sure your rates stay the same after an at-fault accident.
Accident forgiveness will forgive you for your first at-fault accident with a company, meaning your rates won’t go up after an accident.
If you don’t qualify for accident forgiveness, then shopping around for better insurance rates can help lower your rates. You can also drop some of your coverage or increase your deductible.
However, doing either of these things will put you more at risk if you get into another accident. It’s best to just wait until your rates drop or look for a different company.
What if I don’t report an accident to my insurer?
If there is a minor fender bender, it’s fine not to report it. However, most states require you to report any accident that involves an injury.
So if you or the other driver is injured, it’s important to file a claim to avoid lawsuits later.
You risk losing out on a claim later if you don’t report an accident and collect all the necessary information. Another driver could claim the accident is your fault, and because you didn’t file a claim, you lack information and look like a guilty party.
Free Auto Insurance Comparison
Enter your ZIP code below to view companies that have cheap auto insurance rates.
Secured with SHA-256 Encryption
Filing a Claim FAQs
We’ve covered a lot of information in this guide, but we want to go into a little more detail about filing a claim. Stick with us as we go through frequently asked questions about claims.
What if you need a rental car?
If you have rental car reimbursement on your policy, your insurer will cover the cost of a rental car until yours is replaced. Otherwise, you’ll have to cover a rental car yourself.
What if I loan my car to a friend who causes an accident?
If your friend caused the accident, you are liable for the costs of the accident. You are responsible for whoever drives your car, so be careful which friends you let borrow your car.
Does a not-at-fault accident affect car insurance rates?
Unfortunately, a no-fault accident can sometimes raise your rates, even though you weren’t responsible. If you have the bad luck of being hit multiple times, though no fault of your won, insurers will still view you as risky to insure, as they will see accident claims on your record.
Can I make a claim if I hit a deer?
Unless you have comprehensive coverage, it’s likely your insurance won’t accept your claim. Comprehensive coverage protects you from cases of natural disasters, theft, vandalism, and animal collisions.
Can someone file a claim on my insurance without me knowing?
A third party car insurance claim is any claim made against your car insurance policy by anybody else rather than by you (the policyholder). Third-party car insurance claims are the most common auto insurance claims in the United States.
If you get into a car accident with another driver and they feel like they have a valid claim, they are free to file a claim with your auto insurance provider.
If, for instance, you get into a minor collision with another car at the mall’s parking lot, the driver can file a claim against your auto insurance policy if both of you agree you’re at fault.
You are obliged to provide your insurance details to the other party so that they can follow up on the claim with your auto insurance provider.
Upon receiving a third party claim, the insurance provider must determine whether the claim is legitimate or not.
They must call you to get your side of the story and to rule out a false claim, which is always a possibility. Therefore, it’s unlikely (if not impossible) for someone to file a claim on your auto insurance policy without you knowing it.
Did we answer all your questions about filing a car insurance claim? Hopefully, you’re now prepared to tackle claims in the future.
If you want to start comparing rates today, enter your ZIP code into our free online tool below.