Should I File a Claim With My Auto Insurance or Their Auto Insurance?

Last Updated on February 18, 2020

Car accidents can be tricky. You need to file a claim with an insurance company, but you may not know which insurance company to choose.

Should you file a claim with your insurance company or the other driver’s insurance company? Do you need to alert your own insurance company if you were not at fault for the accident? Does the insurance company of the at-fault driver handle everything related to the claim?

Generally, the at-fault driver’s insurance company handles the claim.

If you caused the accident, then you contact your own insurance company to report all damages. Your insurance company will contact the other driver to verify any damages, then compensate you and the other driver accordingly.

If the other driver caused the accident, then the other driver is responsible for contacting his or her insurance company.

If the fault is disputed, then both drivers would contact their own insurance companies, and each insurance company would provide compensation. Then, the insurance companies would communicate with each other to determine fault, then handle compensation accordingly.

Today, we’re answering all your questions about which insurance company to call after any type of accident.

When to Call Your Own Insurance Company

You should contact your own insurance company if you are at fault for the accident, especially when multiple parties were involved in the accident. In this situation, all parties should exchange information.

Even if you are not at fault, it may be in your best interest to contact your own insurance company. It’s generally recommended that all parties inform their own insurers of the accident.

You should also contact your own insurance company if there is severe damage – including extensive vehicle damage or multiple injuries.

Once all parties have informed their own insurance companies, the insurance companies will handle the situation. All communication from this point will take place between the insurance companies. Insurance companies may provide initial compensation to each driver, then negotiate amongst themselves about the final payout.

Should I Always Make a Claim Under My Insurance Policy?

It’s not always in your best interest to make a claim under your own insurance policy.

Filing an insurance claim for an accident will almost certainly raise your insurance premiums, for example (assuming you were at-fault).

Filing a comprehensive coverage claim (say, for a single-vehicle accident or for non-accident-related damages) should not raise your insurance premium. However, you may still need to pay a deductible, and that deductible may be more than the cost of repairs. It may cost just $200 to replace your windshield, for example, while your comprehensive coverage has a deductible of $250.

When to Not Call Your Own Insurance Company

There are situations where you should consider not calling your own insurance company.

If it’s a minor accident between two vehicles, for example, and nobody is injured, then you and the other driver may arrange a deal without contacting insurance. In this situation, neither driver’s premiums will increase, and you may be easily able to cover any damage out of pocket.

There are downsides to not reporting an accident, however. The other driver may use the opportunity to scam you, for example. Two drivers might have a handshake deal to avoid reporting an accident, for example, only for the other driver to contact his insurance company and claim you caused the accident. The other driver might fabricate injuries or engage in other forms of insurance fraud. The other driver might wait three weeks to report the accident, making it more difficult to prove your innocence.

Some insurance policies also require you to report all damage. By failing to report damage today, you may expose yourself to liability in the future. If you damage your fender in a previous, unreported accident, then try to claim the pre-existing fender damage in a separate accident, then car insurance may refuse to cover it.

When to Call the Other Driver’s Insurance Company

If the other driver was at-fault for the accident, then the other driver should contact his or her own insurance company to report the accident.

Don’t assume the other driver will always report the accident. At-fault drivers may be reluctant to report the accident, for example.

Call the other driver’s insurance company to verify the accident was reported.

If you were at-fault for the accident, or if the fault is disputed, then there should be no reason to contact the other driver’s insurance company. In these situations, you contact your own insurance company, and any future negotiations about compensation will take place between the insurance companies.

What Happens If the Other Driver Was Uninsured?

Which insurance company do you contact if the other driver does not have insurance?

In this situation, you should always call your own insurance company. Your insurance company should cover 100% of your costs (minus your deductible). Your insurance company treats the situation similar to a hit and run.

You may also have uninsured motorist coverage, in which case your insurance company will certainly cover any medical bills or repair costs after an accident with an uninsured motorist.

If the other driver does not have insurance, then you can also file a civil suit against the other driver, allowing you to seize the drivers’ assets to cover any expenses incurred as the result of the other driver’s actions.

No-Fault States and Accident Reporting

12 states in America are no-fault states, where all accidents are automatically no-fault. In no-fault states, both drivers have to call their insurance companies if they want to file a claim. 

No-fault states include all of the following: Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania, and Utah.

Keep in mind that Michigan is the only state in America that is truly a “no-fault” state. In Michigan, insurers do not take fault into consideration at all with insurance claims.

Final Word

In most situations, you file an insurance claim with the insurance company of the at-fault driver. If you caused the accident, then you contact your own insurance company to report the accident. If the other driver caused the accident, then the other driver contacts his or her own insurance company to report the accident.

In certain situations, both drivers should contact their own insurance companies. If you live in one of the 12 no-fault states, for example, then both drivers need to contact their own insurance companies to make a claim – even when not-at-fault. Both drivers should also contact their own insurers if the fault is disputed.

Consider contacting the other driver’s insurance company to verify the other driver has started a claim. The at-fault driver may be hesitant to report the claim.