Need Advice on Insurance Claim

Ether on 24/02/2015 - 23:28

Okay here is the situation…

I rear-ended into someone's car. The damage appears to be rather minor (paint scratches and stuff) to the other driver's car. Both parties are comprehensively insured.

The problem here is that my excess is rather high. I was contemplating the following possible scenarios and need some advice on what is liable to happen:

1) Wait for the other driver's insurance company to give me a quote on the cost of damage. If its lower than my excess, I may as well pay for it and not claim from my insurance company. That way I don't need to take my car offline, and I wouldn't have made a claim via my insurance company so insurance premium won't rise. Now the catch here is once the other driver's car is fixed, I'm not sure what else could fly my way and hit me for 6.

2) Lodge a claim via my insurance company, and have them fix both the driver's car and my car (may as well I guess). Problem here is I'm not sure whether the total cost would go over my excess, and also I would assume they would take their sweet time in fixing my car. Also next year's insurance premium is going to rise, though I'm not sure by how much since I never made a claim before.

TIA for the experience and advice.

Automotive

Comments

  • Peck on 25/02/2015 - 00:04
    +1

    Insurance companies understand that you might not want to make a claim and pay the excess if the cost of repairs is low. But it is still worth ringing them and discussing it with them. (As long as you repair your own damage and do not plan on leaving it to devalue the car)

    • Geewhizz on 25/02/2015 - 08:20
      +2

      As long as they receive the money to cover repairs, why are they likely to care whether it comes from the insurance company or OP directly?

      Ether, if the reapairs are likely to come in at less than your excess you'd be nuts to involve the insurance company. You'll have gained nothing, and will lose any no-claim bonus you may have.

    • the-mal on 25/02/2015 - 09:05
      +1

      so I'm guessing the other party will want everything (including the payment of all their damages/repairs) to go through (be paid for) by your insurance company/comprehensive policy

      It's none of their business how the funding of the repairs is handled, only that it is handled. They have no say in the matter of how (insurance or self funded). Their only choice is whether they want to use their own insurance or not.

  • Euphemistic on 25/02/2015 - 08:42

    How much damage to your car? My wife had a minor incident a while ago and it was worth paying the $1k excess to have both cars repaired. If our car had not had obvious damage then I suspect we would have asked the other party for a couple of quotes and paid them direct as it was just a bumper replacement and paint on their older car.

    At the end of the day if the damage is minor in nature then you need to do your sums and make a choice based on that.

  • the-mal on 25/02/2015 - 09:13
    +3

    If you're considering not going through insurance the ideal situation is you ask the other party if they'd mind getting a quote prior to telling their insurance as well.

    A minor scrape is often best handled outside both insurers because it means no ones premiums will go up and no one loses a no claim bonus. Even if you're not at fault, making a claim can make your premiums go up, so if it's small it's best for both parties to handle it outside insurance.

    Also consider if you do call your own insurance company to discuss the situation be aware that, even if you don't claim through them, your premiums may still go up as they'll have it on record that you were an "at fault" driver in an accident so your risk rating will go up.

    Best case scenario for a small scrape - both settle outside of insurance. No premiums go up. From an insurance companies point of view the accident never happened.

    Next best case scenario - They've already claimed through insurance, you pay directly because it's cheaper than your excess + loss of no claim bonus.

    Worst case scenario - You both claim through insurance. No claim bonuses are gone. Both premiums go up. You have to pay excess as well.

    Oh, and you are allowed to ring your own insurance company anonymously and discuss the options without disclosing your details.

    • Ariz on 25/02/2015 - 09:34

      Completely CORRECT…
      Don't let the other party insurance give you a quote because they will increase the other party's insurance premium and they might notify your insurance of the accident for record keeping which will increase your premium.

      • theclearout on 25/02/2015 - 15:33
        -1

        The other party's insurance company will not ask their customer to pay any excess. The excess will be claimed by them from the 'at fault' party's insurance company. The 'at fault' party's insurance company will therefore know.
        There will be no 'penalty' increase to the other party's insurance premium as they were not at fault.
        The 'at fault' driver has a choice in regards to whether they want to have their own car repaired or not. Either way the 'at fault' driver will end up being out of pocket.

        Also, just because the OP thinks the damage is minor it may not necessarily be the case. Bumper mounts and supports may be damaged, anchor points damaged, etc.

        Please don't shout out that something is correct when it's not

        • the-mal on 25/02/2015 - 18:21

          There will be no 'penalty' increase to the other party's insurance premium as they were not at fault.

          That is incorrect. Premiums are worked out by many factors including claim frequency and is affected regardless of whether you're at fault or not, obviously much less drastic changes of you're not at fault, but it definitely can still increase.

          I work in insurance and understand underwriting algorithms pretty well.

  • BewareOfThe Dog on 25/02/2015 - 10:13

    They should at least have 2 to 3 quotes. Panelbuilding work is tight at the moment (heard from an ex-pb
    ). There is also a dentless repair service as well. I was in a situation a few years ago, and ended up paying her $500 to rack off. Cheaper than the $650-750 which her vehicle just worth much more than that.

    • the-mal on 25/02/2015 - 10:44

      They should at least have 2 to 3 quotes.

      Most insurers don't do this any more. They'll have preferred repairers within areas that work for prior negotiated bulk rates. The insurance assessors set the "cost" of repairs, you pay that up front, and if the work extends past that cost the insurer wears the extra (unless you haven't paid in which case they pass on the extra and will chase you with collectors).

  • salbee28 on 25/02/2015 - 11:39

    It's always worth asking the other party to get a quote to fix their car privately without involving insurance & do the same for yours, some people even have a preferred panel beater that will give you a good price.

    I learnt the hard way, that anytime you rear end someone, you will be found at fault, even if the driver in front was doing something stupid or illegal. And Insurance companies won't bother listening to how or why it could have been the other parties fault. At fault = more money for them in the long run.

  • spackbace on 25/02/2015 - 11:54

    Bear in mind the other party might have hire car use covered under their policy, so it's in their best interest to go through insurance for the claim. After all, if you were at fault, why should they be put out and have to use a 2nd car or something? So you might find they've already gone to the insurance company, especially if they have your details.

    • Roary on 25/02/2015 - 12:40

      If they have car hire under their policy that's between them and their insurer. You are not obliged to pay for their car hire unless they take you to court and sue you for lost arising from the accident.

      • spackbace on 25/02/2015 - 13:00
        +2

        What I'm saying is:
        Lets say I'm the person that got hit. I don't have to pay any excess as I have your details. I will have a lifetime guarantee on repairs. I will get a hire car while my car is in the shop, making it less hassle for me (after all, you hit me and inconvenienced me).

        So tell me, why would I then agree to settle this outside my insurance company?

        • nickster9999 on 25/02/2015 - 14:32

          Exactly. Even a small repair might take the car out of service for a few days. If the person relies on it for commuting to work, recreation etc, they'd be unlikely to accept your payment of just the repairs when they know they can get a hire car for free (if their policy covers that).

        • the-mal on 25/02/2015 - 15:19
          +1

          To stop your premiums going up. If there is a way to avoid using your car insurance for something small, even if it's an inconvenience, you should do it. Insurance is great to cover you in big accidents. It's terrible for small things because both parties will have increased premiums for years to come.

          People who think if you're not at fault then there's no ill effects to your premiums need to read their PDS more closely.

        • spackbace on 25/02/2015 - 15:21

          @the-mal:
          Protected NCB…?

        • the-mal on 25/02/2015 - 18:17

          @Spackbace: No Claim Bonus is different from your base premium which will absolutely still go up if you make a claim. Base premiums are worked out via lots of factors heavily influenced by your risk rating and policy activity.

  • Cheeper on 25/02/2015 - 17:07

    If you end up taking the non insurance claim route then write up a document for the other party to sign prior to handing over money stating that in accepting this payment they will take no further action. In short… it is the end of it all.

  • martinj on 25/02/2015 - 18:01

    You should make sure you read the terms and conditions of your policy. Most policies will say you have to report any accident.

    If you don't report the accident within a certain time frame you might not be able to claim. You don't want the other person, or their insurance company, coming back in a few months and saying the damage was more expensive than you thought.

    Also, depending on the policy, if you don't report the accident, your insurance might not be valid for future accidents.

    Although these are worst case scenarios, I think you're better off reporting it and possibly paying higher premiums than risking running into a Ferrari and finding out you're not covered.

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