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#1
Old 10-17-2012, 01:20 PM
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Advice sought: when to involve auto insurer in minor incidents?

Last week, late on a rainy weeknight, I accidentally rubbed my car against a parked car. The corner of my front bumper rubbed at very low speed, and at a shallow angle, against the other car's rear fender. As the incident took place on a dense residential block, there was no way for me to determine with which building the car was associated.

I wrote a note with copious information and an apology, found a suitable way to waterproof it, and left the note under the victim's windshield wiper. I did not get a close look at the damage. I believe (hope) it to be cosmetic only... a trading of paint with no deformities inflicted. The car's owners called me last evening. The good news: they sound like pleasant, calm people who recognize this was an accident. They will take the car to their mechanic/body shop for an estimate in the next few days. No insurance companies have been contacted, nor has there been a police report filed.

My question: at what price point (on the repair bill) do I involve my insurance company vs. paying out of my own pocket? I have a perfect lifetime driving record. My insurer is Geico. I don't have any sort of extra "forgiveness" coverage or anything similar of which I am aware.

I am pretty cynical about auto insurers. My guess is that any amount they pay out if a claim is filed, no matter how big or small, will be trumped several times over by future premium increases. Hell, I'm cynical enough that I don't even want to call my insurer to ask a "hypothetical" question along these lines. Is there some rough formula that I can use -- once the repair estimate arrives -- to make an educated, quantitative decision on how to proceed? Something like: if (Deductible * 2) - (Years with insurer) / (Hat size) >= (Premium), pay out of pocket.

Thanks.
#2
Old 10-17-2012, 01:52 PM
Just Lovely and Delicious
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What is your deductible? If the repairs are less than that, then pay cash for the repairs.
#3
Old 10-17-2012, 02:24 PM
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Quote:
Originally Posted by ZipperJJ View Post
What is your deductible? If the repairs are less than that, then pay cash for the repairs.
I'd say, if the excess (or deductible or whatever you want to call it) is more than about half the cost of repairs, it's probably not worth the hassle and increased premiums to make a claim. If it's only a scrape on a bumper, it's surely not going to cost that much.
#4
Old 10-17-2012, 02:39 PM
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Find out the cost. Once you know that, you can make a decision.

In my case, I figured that considering the amount I had paid to my insurance company over the years, I might as well get something back. I did get an increase in premiums, but the total was far less than the above-deductible cost of the repair.

I can't speak for GEICO, but when I've had insurance claims, the companies handled them with a minimum of fuss on my part.
#5
Old 10-17-2012, 02:41 PM
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Deductibles apply only to the insured's vehicle. Repairs to the other vehicle are covered 100%.

My GEICO premiums go up a couple of bucks every year no matter what I do. I've had two minor accidents in the past ten years, and my premiums have not gone up as a result. In the past, with another insurance company, my premiums sky rocketed after a couple of minor accidents, and the rate hike was in effect for several years.

If you get a ticket, the insurance company knows about it, and it probably counts against you as much as if you'd made a claim. If someone is in the other car, it's a good idea to file a claim in case they later say they were injured.

In your case, I'd go ahead and file a claim unless the estimate is only a small amount.
#6
Old 10-17-2012, 03:15 PM
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Clarification to original post

Thank you, all, for your responses thusfar. Reading back over my original post, I realize I was ambiguous on one point.

To clarify: I do not intend to get my car repaired. There's nothing to fix, really... just a bit of yellow paint amidst a sea of other battle scars. (My car is an urban beater that has been the victim of many scrapes and dings -- none with me present -- including some legitimate hit-and-runs).

My decision is only whether to compensate the other folks out of my pocket or out of the insurance company's pocket.

Thanks!
#7
Old 10-18-2012, 04:32 PM
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What state are you in? In my state, insurers are required to file their definition of "chargeable accident" including the dollar amount. If the repairs are below that threshold, the insurer cannot raise your rates based on the claim. They are also required to send their customers a notice explaining how the insurer's rating plan provides for rate increases based on incidents (tickets) or claims (accidents).

You might contact your state insurance department and see if insurers have to file that information.
#8
Old 10-19-2012, 11:14 AM
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Quote:
Originally Posted by Nuveena View Post
What state are you in? In my state, insurers are required to file their definition of "chargeable accident" including the dollar amount. If the repairs are below that threshold, the insurer cannot raise your rates based on the claim.
Nuveena, thank you for the information. I live in Illinois. I had not heard of this notion of a "chargeable accident," but I will give it a look.

Hopefully this allows me to do some research without involving my insurance company. Am I right to be so cynical? I just have this feeling that the whole thing is very Heisenbergian. That is, simply by asking questions of my insurer, I will somehow be permanently screwed over.

FYI: I have not yet heard back from the victims about the repair bill. (They did say it might take them several days to get the car in for an estimate.)
#9
Old 10-19-2012, 02:05 PM
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Quote:
Originally Posted by El Famous Burrito View Post
I have not yet heard back from the victims about the repair bill. (They did say it might take them several days to get the car in for an estimate.)
Note that your insurance company may not be real happy if they learn of an accident they are expected to cover long after it happened. They might, for example, wish they'd been given the chance to promptly inspect the damage.
#10
Old 10-19-2012, 04:53 PM
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Quote:
Originally Posted by Xema View Post
Note that your insurance company may not be real happy if they learn of an accident they are expected to cover long after it happened. They might, for example, wish they'd been given the chance to promptly inspect the damage.
The insurer isn't going to mind if he waits a few weeks, or even 6 months. Although if it's going to be that far out, it's in your best interest to take pictures so they can't claim extra damage against you later. But legally, the only requirement for timely claim filing is that you not exceed the statute of limitations. And for a property damage claim in IL, you have 5 years from the time of an accident to file a claim.

I would say, handle a claim like this as a self-pay as long as you can afford it, until/unless the claimed damages seem outrageous or fraudulent. As stated above, you won't pay a deductible to repair their vehicle. But damages might be a lot more than they look. Don't be surprised if it comes out to several hundred bucks. Just ask them for the estimate, look over it, and pay the company directly.

I also think it'd be a good idea to type out an informal release of future liability. Sign it, and get them to sign it. Something like this:

I, yourname, hereby admit that I damaged theirname's year-make-model vehicle on date. By paying $xx.xx for repairs, I have made theirname whole for the damage I caused. Theirname agrees to release yourname from further liability for this accident.

Sign it, have them sign it, and file it away with a copy of the repair estimate. If they won't agree to sign, though, I would recommend going through insurance. The name of the game is "cover your ass." Scammers are capable of sounding nice and reasonable, at first.
#11
Old 10-19-2012, 05:20 PM
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Quote:
Originally Posted by laina_f View Post
If you get a ticket, the insurance company knows about it
Not always true. At least in my state, there is some arbitrary fee for them to look up your record, and they don't usually bother to pay it for renewing policies. They'll sometimes send you a survey instead, hoping you'll self report. But I've never filled these out, to no penalty.
#12
Old 10-20-2012, 10:06 AM
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Quote:
Originally Posted by Rachellelogram View Post
The insurer isn't going to mind if he waits a few weeks, or even 6 months.
I question this. I suspect many insurers would prefer not to hear that they are expected to pay for damage incurred in a long-ago accident, the detail of which is no longer available for examination or dispute.

Quote:
it's in your best interest to take pictures so they can't claim extra damage against you later.
The insured has no particular interest in taking pictures if it's the insurance company that will be paying.
#13
Old 10-20-2012, 01:03 PM
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You always report an incident. Failure to do so may invalidate your insurance. Making a claim is not mandatory! You tell your insurer, "I am reporting this incident. I do not wish to make a claim at the moment but reserve the right to do so."
#14
Old 10-20-2012, 03:33 PM
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I rear-ended someone last year and reported the accident to State Farm out of paranoia over what they might do if the other driver filed a claim and they'd heard nothing from me. It was at very low speeds and neither of us spotted any damage to either car at the scene, but you never know what people might do afterward. State Farm took the report but said they hadn't heard anything and not to worry for now. Nothing ever came of it and my rates never went up.
#15
Old 10-22-2012, 11:45 AM
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Quote:
Originally Posted by Xema View Post
I question this. I suspect many insurers would prefer not to hear that they are expected to pay for damage incurred in a long-ago accident, the detail of which is no longer available for examination or dispute.
Insurers would prefer not to hear that they're expected to pay for damage, ever. At the insurance company I work for, we don't care if you're reporting a claim from yesterday or 6 months ago. It's harder to prove older claims than a fresh one, so it's in the insured's best interest to file promptly. But as long as you're within the legal time period within your state (the statute of limitations), it's cool with us.
#16
Old 10-22-2012, 02:14 PM
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Quote:
Originally Posted by Rachellelogram View Post
At the insurance company I work for, we don't care if you're reporting a claim from yesterday or 6 months ago. It's harder to prove older claims than a fresh one, so it's in the insured's best interest to file promptly. But as long as you're within the legal time period within your state (the statute of limitations), it's cool with us.
Rachellelogram, thank you for the insider's look. There is good advice for me so far in this thread, but I think I will still wait out the repair estimate before contacting the insurance company.

MILD UPDATE: I have yet to hear from the folks whose car I rubbed since our initial conversation. I did see their car out on the street over the weekend. I didn't want to be creepy and examine the car up close, but it looked as if it had already been fixed? This would bother me if true, as I intended to decide how to resolve things based on the estimate, before work was done. Maybe the paint I deposited really did just buff out? (Or perhaps I just mistook what I saw?) Anyway, I'll update when I hear back.
#17
Old 10-22-2012, 06:12 PM
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Quote:
Originally Posted by Rachellelogram View Post
Insurers would prefer not to hear that they're expected to pay for damage, ever.
Note that this very obvious point is not relevant to the current discussion.


Quote:
At the insurance company I work for, we don't care if you're reporting a claim from yesterday or 6 months ago.
I checked with my auto insurance company this afternoon and was told that they strongly prefer to hear of an accident as soon as is practical after it occurs.
#18
Old 10-22-2012, 07:49 PM
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Quote:
Originally Posted by Xema View Post
I checked with my auto insurance company this afternoon and was told that they strongly prefer to hear of an accident as soon as is practical after it occurs.
I checked with the one I actually work for, and we don't give a shit. Why are you fixating so hard on this irrelevant point? Your insurance company will take the claim and handle it no matter what their stated preference, because they're your insurance company and they're contractually-obligated to do so. It's not like they will raise your rates because you did something they'd rather you didn't do.
#19
Old 10-22-2012, 08:19 PM
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Quote:
Originally Posted by Rachellelogram View Post
Why are you fixating so hard on this irrelevant point?
Because it doesn't seem irrelevant in a thread requesting advice after a minor auto accident.

I'm not claiming that the insurer will deny coverage for a late report (though there is no doubt some limit). I am claiming that at least some will prefer the report be timely, and that a timely report may help avoid some problems.
#20
Old 10-23-2012, 11:59 AM
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Quote:
Originally Posted by Xema View Post
a timely report may help avoid some problems.
Which I stated, too. It sounds like we agree on that. It's in the insured's best interest to report a claim ASAP because memories get rusty, it's easier to prove new damage than old damage, and it's also more likely that the other party may try to add in additional damages that have accumulated since their accident with you.

None of this means the OP should report this to his insurance company now, though, it's just a general best-practice. That, I think, is where we disagree. As long as he is capable of handling their damage claim out-of-pocket and getting them to sign a release, he's good.
#21
Old 10-25-2012, 01:15 PM
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Update

So the couple whose car I scraped left me a voice mail. They say the repair estimate is $300, which is higher than I was hoping. Let's assume, for now, that this is an honest estimate that accurately reflects the cost to repaint/repair the scraped body panel. I will call them back soon.

I decided, first, to call GEICO to try asking some "hypothetical" questions without sounding too suspicious. I spun it as me being unhappy with a recent rate increase (triggered this summer when I moved one zip code over). I said that I've decided to shop around but that I realized there might be some value in my policy that goes beyond simple premium and deductible amounts. "I want to be sure I understand exactly how my policy works!" I said.

It went better than I expected. Amongst obfuscatory questions about rental cars, traffic tickets, medical coverage, etc., I slipped in questions about "chargeable accidents" and how my premium might be affected by various types of incidents. With a host of disclaimers, the nice woman informed that generally, with my record and my coverage, I should not expect my premium to go up if the amount paid out is under $500. Bingo! So I'm thinking, pending another call with the victims, I'll report this to GEICO and let them handle.

But wait! Before I could politely get off the phone, the nice woman with GEICO went into "retention mode." Fearful of losing me as a customer, she said that they just got approved for new rate schedules in Illinois and that maybe they could reduce my premiums while retaining identical coverage. This sounded like marketing/retention BS to me, but OK, sure; I'll give a listen. The new premium would be around 2/3 my old premium! I'd save around $110 every 6-month billing cycle. And they'd throw in one accident/ticket forgiveness bonus.

So... now I'm back to thinking that I just pay out of pocket and bank my new forgiveness chit for a real incident. Left unanswered -- because I didn't dare press further -- was how severely my new premium reduction would be rolled back if I retroactively reported my incident from two weeks ago.
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