No one wants to find themselves to be the cause or victim of an auto accident. Many people also struggle trying to navigate the complex insurance claims system. While the claims process may seem daunting, we want to help demystify the process. In this article, we help guide you through when to file a car insurance claim.

Be sure to understand your options

Before you make a car insurance claim, it’s important to consider the following:

  • Making a claim may increase your premiums in the future or when you renew your policy. A bad driving record can increase your auto insurance premiums for three years.
  • Some insurance companies offer a discount if you don’t make any claims under your policy.
  • Be sure to take into account the severity of the claim – in terms of property damages and bodily injury.

When deciding whether or not to file a claim, it’s important to take into account whether property damage or bodily injuries are involved, and what type of coverage you have. Unsure what to do after an accident occurs? Learn more about the six steps you should follow when reporting a car accident in Ontario here. 

When should you file a car insurance claim?

When deciding whether or not to file an insurance claim, there are a number of situations when you should file a claim:

1. You cause major damage to your or another person’s vehicle

Although you may not be sure if the costs will exceed your deductible, you definitely want to tell your insurance company if the extent of the damage is not clear. They can suggest one of their preferred body shops, which can help streamline the process. If you were involved in a single-vehicle incident, coverage comes in two forms. Collision insurance will pay for your repairs for most single-car crashes, minus the deductible. If you don’t have collision coverage, you’ll have to pay for repairs out-of-pocket. If you run into a deer or other animal, your comprehensive insurance coverage will kick in.

Preferred car repair shops and the insurance company are in direct communication with each other. The work that these shops do is guaranteed by the insurance company. In addition, the repair estimate gets sent directly to the insurance company’s appraiser, and no additional estimates are required.

2. An injury happens as a result of an accident

If an injury occurs as a result of an accident, you should absolutely inform your insurance company. Medical bills are not something you can pay out-of-pocket, and the police need to be notified, as well. Hiding accidents with injuries is a bad idea for your health, not just for your insurance rates. If you’re an Ontario driver, you can count on the coverage your auto insurance policy provides. Ontario’s legislation ensures that all auto insurance policies include Accident Benefits (AB). The AB section provides compensation if you, your passenger(s) or a pedestrian suffers an injury in a car accident. This is regardless of who was at-fault. With No-Fault insurance in Ontario, your insurance company will take responsibility.

3. You suspect insurance fraud

Ontario is currently in a hard insurance market, meaning that car insurance rates in Ontario are at their highest. There are several types of car insurance fraud that exist. From premeditated scam artists to individuals inflating the severity of their injuries, fraud is a huge problem. If you suspect that you may have fallen victim to an insurance fraudster, having your insurance company on board at the outset can help determine if a claim brought against you is legitimate.

To learn more about insurance fraud and ways to avoid it, please click here.

Canadian drivers end up paying an average of $125 annually to combat car insurance fraud. Ontario drivers pay an average of $236 every year to cover the cost of insurers getting defrauded. 

When not to file a car insurance claim 

While filing a claim for damage caused to others is always encouraged, there are instances where you perhaps should not file a car insurance claim. Here are some of them:

1. When you have only minor damage to your vehicle

If a minor accident only involves you and your car, a claim might not be necessary. Opting not to file a car insurance claim will prevent you from risking an increase in premiums. But how do you know if the accident was minor? Severity of the damages are usually broken down into three categories:

  1. How fast were you or another involved party going at the time of the accident?
  2. What part of your car was hit (front damage may be more dangerous than a bump on one of your doors)?
  3. Did it involve another car and/or driver? Whatever damage your car has is potentially multiplied by the other party’s injuries.

2. When your claim is less than the deductible

An auto insurance deductible is what you pay “out of pocket” on a claim before your insurance covers the rest. Collision, comprehensive, uninsured motorist, and personal injury protection coverages all typically have a car insurance deductible. If the repair cost is lower than your insurance policy’s deductible, it’s probably not worth filing a claim. Filing also means that your rates will go up and stay high for at least three years. But you won’t get any reimbursement. Filing a claim for damages just over your deductible is also not advised. Your reimbursement will be small and your premiums will likely still go up.

3. If the damage is minimal and you’re not at-fault

You may choose not to file a claim if the accident was minor and/or only involved you and your vehicle. Should you not be at-fault for an accident, you may choose not to file a claim, as well. In some cases, even if you’re not at-fault, filing a claim can still increase your premium. If the damage to your vehicle is minimal, the at-fault driver may be motivated to pay you directly. While filing a claim to cover damage to your vehicle is always an option, it may not be your best financial choice. If you do decide to file, go directly through the other driver’s insurance as much as possible. Your insurance can only react if notified of the issue by you, the other driver, or a ticket related to your police report.

In each of these situations, it may not make sense financially to file a claim because it can go on your record. An increase in rates can cost you more money longterm than paying for the repairs yourself. Starting a claim should be a priority if your vehicle has major damage. But, if it’s a minor car accident or smaller damage, you might want to think twice before filing a car insurance claim.

Helpful hints if you are in an accident

Don’t admit fault

From your perspective, the accident was your fault. But maybe the other driver is thinking the same thing. What if the driver of the minivan was speeding, texting or changing the radio station? Admitting fault lets them off the hook. If you are filing a claim for damages, contact your insurer. They will assign a claims adjuster to clarify fault. Your adjuster — in tandem with the other driver’s claims adjuster — will decide how fault is divided and, in turn, how the cost will be divided.

Don’t negotiate with the other driver

You should think twice about entering into any private negotiations to settle with the other driver involved in the accident. The damage to your car might be more extensive than you realize. You want to avoid private deals because there is typically nothing to prove you made the agreement with the other person. You might pay them, and then it turns out that the damage was more extensive. The other party might come back and demand more money or file a claim on their own.

Know the ins and outs of your policy

Be sure to carefully read your auto insurance policy and understand when it is best to file a car insurance claim, and when it makes more sense not to. If the accident is serious enough for you to consider filing a claim, make sure you file a police report and get documentation at the time of the accident. Call your isure broker immediately to inform your insurance company that you have been in a car accident. Let them know what happened and ask for next steps. It is the role of your broker to help you. You must submit an accident report within seven days, ideally 24 hours.

At isure, our brokers have your best interests at heart. Should you decide to file a claim, our brokers will work to provide you with our 24/7 stress-free claims service. From initial response to getting it fixed, we’re here to provide you fast, friendly service. For more information, contact your isure broker today.

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