Do You Need to Get Insurance Involved After a Small Accident?
You were involved in a small accident and now you’re debating whether to tell your insurer.
Does insurance really need to get involved if there were minor damages and injuries? Should you really report every accident to your insurer?
Today, we’re explaining everything you need to know about when to get insurance involved after a small accident – and when not to.
Do You Need to Report Every Accident to Law Enforcement?
First, it’s important to determine whether or not your accident needs to be reported to law enforcement.
Rules vary between states. Generally, state law requires you to report an accident to law enforcement if there are serious injuries or if there is more than $1,000 to $2,500 of vehicle damage.
Many drivers get into minor fender benders in parking lots, for example. You lightly bump another vehicle. There is minor physical damage but there are no serious injuries. Assuming there’s less than $1,000 of damage to the two vehicles involved and no injuries to any drivers or passengers, police generally do not need to be called.
Alternatively, if you get into a T-bone collision at an intersection, you may need to call law enforcement. There may be serious injuries to multiple people. One car might have $5,000 of damages or more. In this situation, law enforcement does need to get involved because a police report needs to be filed.
Generally, you need to report an accident if:
- There’s more than $1,000 or $2,500 in damage (specific amounts vary by state)
- Someone is injured
If the accident occurred in bad weather, then you may not be able to file a police report. You might call 911, only to be told that law enforcement cannot respond to your scene because there are other emergencies caused by the bad weather conditions. Assuming both drivers are uninjured, you should be able to drive to a gas station or convenience store nearby to complete an accident report form.
Some Injuries Take Days or Weeks to Appear
Keep in mind that some injuries do not become apparent for days or even weeks after an accident. You might feel fine immediately after the accident but notice symptoms later.
If you do not immediately call law enforcement to report an accident, then discover at a later date that you were actually injured, the other driver can argue that the accident never occurred. Without a police report verifying the accident, it becomes your word against the other driver’s word.
Should You Always Report an Accident to your Insurance Company?
We’ve established when to report an accident to the police – and when not to. But should you always report an accident to your insurance company?
Almost every car insurance policy in the United States requires drivers to report every accident to their car insurance company. Failing to report an accident to your insurance company – even if it’s a minor accident – could lead to significant penalties down the road.
Many people avoid reporting accidents to their insurance companies because:
- They assume insurance premiums will increase if they report an accident
- They assume the accident can be “worked out” with the other driver without getting insurance involved
Both of these beliefs can quickly become a problem for policyholders.
Reasons to Report Every Accident to your Insurer
Generally, you should report every accident to your insurance company even if you ultimately do not decide to file a claim. There are several reasons to report each accident.
First, you’re violating your insurance policy by failing to report any accident.
Second, the other driver could get you in trouble by reporting the accident to his insurance company even after you both agreed not to. Let’s say the other driver gets home and starts to feel worse. His neck starts to feel sore. He goes to the doctor and realizes he needs thousands of dollars of treatment for whiplash and soft tissue damage. He calls his car insurance company to make a claim, and his car insurance company contacts you. In this situation, your car insurance company could deny certain protection to you because you failed to report the accident promptly.
Third, an insurance company could deny future claims because you failed to report a previous accident. Let’s say you damaged the back-end of your vehicle when you reversed into a streetlight in a parking lot. Then, a few months later, someone rear-ends you at a traffic light. Your insurance company may deny or reduce your claim because they cannot separate the old damage (which was uncovered and unreported) from the new damage (which would otherwise be covered and reported).
To avoid complications like this, it’s generally in your best interest to report an accident to your insurance company as soon as possible.
Reasons to Not Report an Accident to your Insurer
Up above, we talked about all the reasons that you should report an accident to your insurance company. But are there any situations where you should not report an accident to your insurer?
The only time you should consider not reporting an accident to your insurance company is if the accident happens in your vehicle, on your property, no injuries are involved, and you only damaged property you own.
In this situation, there is no dispute with any other party, there are no injuries to yourself or others, and there’s no possibility of a dispute about the cost of repairs.
You Can Call Your Insurer and Not File a Claim
It’s important to remember that you can contact your insurance company but not file a claim. This is called an insurance inquiry.
Because your insurance policy may require you to report all accidents to your insurer, this is considered “best practice.”
Let’s say a tree branch falls on your hood and leaves a large scratch. You call your insurance company and report that you have minor damage that will cost about $400 to repair. You could make a claim and pay your $500 deductible. However, it’s in your best financial interest to pay for these repairs out of pocket. It doesn’t make sense to file a claim.
Does Filing a Claim Raise Car Insurance Premiums?
We get it: you don’t want to file a claim to your insurer because you’re worried about higher premiums.
However, filing a claim does not necessarily raise car insurance premiums. After you file a claim, the insurance company will consider several factors when deciding to raise your rates:
Accident Severity: More severe accidents will lead to greater rate increases because the insurance company had to pay a larger amount of money.
Fault: Your rates may stay the same if the other driver was at fault, but your rates will likely increase if you are found at-fault.
Accident Forgiveness: Many companies allow you to pay extra for accident forgiveness. You get one ‘free’ accident before your premiums increase.
Comprehensive Coverage: Comprehensive coverage claims (say, for damage that occurs outside of accidents) should not raise insurance rates. Making a claim for a fallen branch, hail damage, or other items, for example, will fall under comprehensive coverage and should not raise insurance rates.
Most car insurance policies require you to report every accident. However, that doesn’t necessarily mean that you need to file a claim after every accident.
Generally, for serious accidents involving more than $1,000 in damages or injuries to any person, you should file an insurance claim.