fender bender

Pay Out of Pocket for Auto Body Repair

New Look Collision Repairs

fender benderAfter a car accident, the first thing you should do is pick up the phone and get a hold of the insurance company right? Chances are (your parents &) your insurance provider tells you to report even the smallest incident on the road. Well, wait just one, hot minute.    Because when you file a claim, it can result in an increase of rates up to 40 percent!

It isn’t always the best choice to submit a claim for reimbursement to your car insurance company. It might liberate you from that particular charge, but the odds are your insurance rates will cost you more in the long run for reporting the minor ding. You see, complex calculations are used to decide how much you will pay, and claims attached to your account drive up the cost.

If you file frivolously; too many claims or the wrong kind when you should have filed another, you risk rising your premium or outright losing coverage altogether.  Losing coverage would force you into the expensive position of buying a new policy.

Pay Out of Pocket for Body Repair

Unfortunately, there is no straightforward list that can draw when you should versus shouldn’t submit an insurance claim for body repair. The best approach is to consider what insurance is originally intended to do — to protect against costs you cannot fathom affording. Even if you regularly pay your bills on time, it’s not the best idea to turn immediately to your insurer.

Rule-of-thumb: If someone is badly injured in the accident, submit a claim because the incumbent medical bills for the injury would likely exceed your budget.  Now, let’s look at a few hypothetical situations that you might have been in yourself:

Situation 1: Single Car Accident

With only a couple hundred dollars’ worth in damage, you should pay the bill out of pocket.  Take, for example, if you accidentally backed into a pole. Nobody else was involved, and the pole was not damaged.  In this situation, paying out of pocket is going to spare you from insurance price hikes.

Situation 2: Two Cars Collide

If you are at fault in a two-car collision with less than $1,000 in damages, you might ask the driver if you can pay for the repairs out of pocket.   Yes, we said it.  Though it is required by law for both drivers to exchange insurance information, you may be able to convince the driver not to file a claim if you pay for the repairs out of pocket or use your credit card to help keep premiums down. It’s a tricky process.   You’ll need to get a quote quickly so you can still file a claim if the cost is higher than you anticipate.

Situation 3: The Other Driver is at Fault

If you were hit by another driver and feel confident that that individual will maintain responsibility for damage by paying for your repairs then you don’t need to file a claim through your insurance company. Remember that claims where you weren’t at fault can still result in an insurance rate increase.

Situation 4: When The State Gets Involved

There are a couple of grey areas where you might be better off filing a claim. Throughout the majority of United States, there’s a mandate that stipulates accidents with collision damage that exceeds a given dollar amount needs to be reported. This amount is typically somewhere between $500 and $1,000, and accidents usually don’t cost less than $500. The repairs cannot exceed the dollar amount of your state, or else failing to report could be illegal.

Situation 5:  You Sustained Injury


Though sometimes it’s financially prudent to avoid submitting a claim, there are times when it’s in your best interest to file.  After all, insurance is there to provide protection from serious situations. For instance, if there was an injury,  file a claim.   You might not have a choice, since the other party will likely insist on filing his or her own.   Since none of us can predict medical bill expenses given the obscure nature of our health care system, filing a claim is the way to go.

Be sure to consider your situation carefully before deciding whether it’s a good idea to file a claim or pay out of pocket.  Fender benders and the like could probably be covered out of pocket.  While it might make a dent in your wallet up front, you spare yourself from spikes in your insurances rates over the long term.   To find out how much money your facing in an auto accident, run your car’s information and pictures through our FREE online estimator.  You will get an estimated quote within a few hours to help you decide whether you should file or pay out of pocket.