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While auto insurance companies insist they
want to know about the smallest accident, it's clear that if your deductible
is more than the cost of your repairs, you are better served to pay the bill
yourself and leave your claim unreported.
There is no law that requires you to report an
accident to your insurance company, and you should remember that every time
you file a report with your auto insurer, even if the damage is less than
your deductible, it goes on your insurance record.
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Insurance companies want to know in case you
file a future claim for damages that really happened in an earlier accident.
Common sense says if the repairs cost less
than your deductible you're better off paying for them on your own and
keeping the story to yourself. The wisdom that says take a higher deductible
on your insurance to lower your rates extends to this scenario. Take the
money you save on the lower rates and deposit it into a savings account.
When an accident happens, you'll have the money for repairs even if the cost
is slightly more than your deductible.
If there is another car
involved in the accident, or if there is someone else in the car with you,
you definitely need to let your insurance company know about the accident.
You can never be sure if a passenger or another driver will file a claim on
your insurance. So, you're better off making sure your side of the
story gets on record with both the police and your insurer. In addition,
because injuries are not always immediately apparent, you should report an
accident in case you sustain injuries that show up a day after the accident
and need medical treatment. These accidents should be reported to
police because it provides anyone involved in the accident a professional,
neutral, written account of the accident. It also provides your insurance
company documentation of the accident, including time, date, conditions,
injuries, if any, and responsibility.
Once you contact your
auto insurer, be prepared to have the information remain in your file and
dog you if you change insurance carriers. Auto insurers share information on
policyholders' histories. But when the damage is extensive, it's appropriate
to take advantage of the insurance you've paid for. Your rates won't
necessarily go up every time you file a claim. It depends on the
circumstances and your history with the company. Although insurance industry insiders won't say
as much, the trend toward nonrenewals and tighter restrictions on what is
covered across the industry suggests you should use your car insurance like
your home insurance, for expensive damage, and plan ahead to pay out of your
own pocket for the smaller repairs.
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