Imagine this: You wake up one morning, head out to your car, and find your passenger window shattered and the inside of your car a mess. Even though you don’t keep anything valuable in your car, the window is broken and there are some serious dents in the door. You’re looking at a repair bill of around $1,000. Now, you’re faced with a decision: should you pay for the repairs yourself or file a car insurance claim?
The answer to this question depends on what your auto insurance policy covers, the size of your deductible, and how the claim might affect your car insurance rates in the future.
Filing an auto insurance claim isn’t as simple as pressing a button. You need to understand what you’re getting into before you start the process.
There are pros and cons to filing an auto insurance claim. On the bright side, a claim can help you reduce or even eliminate out-of-pocket repair costs and expensive liability lawsuits. However, filing a claim can also increase your premiums and might be more hassle than it’s worth.
If your insurance company approves your claim, filing a car insurance claim can have clear financial benefits. It can help you pay for repairs, protect you from lawsuits, and could even get you into a newer car.
However, there are also drawbacks to filing a car insurance claim. It might raise your rates, you might still have out-of-pocket costs, and the claims process takes time.
In some situations, filing a car insurance claim is the best course of action. For example, if you had a car accident with another driver, were injured in an accident involving another driver, or you damaged your car yourself and the repairs cost more than your deductible.
On the other hand, there are times when you’re better off not filing a car insurance claim. For example, if you damaged your car yourself and the repairs cost less than your deductible, the type of damage isn’t covered by your policy, or your car isn’t damaged and the other driver doesn’t want to pursue a claim.
In conclusion, millions of car accidents happen on American roads each year. Each one represents a potential unexpected expense for the person or persons involved. Not all cause significant financial distress, however. Very often, car insurance makes the difference. Adequate car insurance coverage can turn a $5,000 repair bill into a far more manageable $500 expense, entirely offset the cost of replacing your totaled vehicle, or even shield you from a lawsuit that might otherwise bankrupt you.
On the other hand, minor fender benders might not warrant the effort it takes to file an auto insurance claim. Filing could even backfire if it produces little upfront financial benefit and years of higher premiums on the back end. So it pays to know when to file — and when to hold your fire.
