Should I Make a Claim if I’m At Fault? Understanding Your Options After an Accident

Getting into a car accident can be a stressful and confusing experience, especially if you were at fault. You may be wondering if you need to file an insurance claim or not. There are several factors to consider when deciding whether or not to make a claim after causing an accident.

What Does “At Fault” Mean?

When an accident occurs, insurance companies will investigate to determine which driver was primarily responsible, or “at fault.” This is known as fault-based insurance. The at-fault driver’s insurance typically covers the damages.

Here are some common scenarios where a driver would be deemed at fault:

• Rear-ending another vehicle
• Making an unsafe lane change and hitting another car
• Running a red light or stop sign and colliding with crossing traffic
• Driving over the speed limit and losing control of the vehicle
• Distracted driving leading to an accident

Even if you think you weren’t completely to blame or you feel the other driver shares some fault, one driver is usually considered predominantly at fault after an investigation.

Should I File a Claim if I Caused the Accident?

If you caused an accident that resulted in significant vehicle damage, injuries, or both, you should file a claim with your insurance company. Here’s why:

Your Insurance is There to Protect You

The whole point of carrying auto insurance is to have coverage when accidents happen. If you are at fault for property damage or injuries, your liability insurance will pay for the other party’s repairs and medical bills up to your policy limits. This protects your finances from large out-of-pocket expenses.

Without filing a claim, you could be sued by the other driver and held personally responsible for all damages. This could cost you thousands of dollars if you have to pay medical bills, lost wages, and repair costs on your own. Reporting the claim engages your insurance company’s legal team to defend you.

It’s Legally Required in Most States

Nearly all states require drivers to carry minimum liability insurance. If you damage someone else’s vehicle or injure them, state laws expect you to file a claim so your insurer can pay for those losses up to your coverage limits. Not reporting a legitimate claim may be considered insurance fraud.

Failure to Report Raises Suspicion

Insurance companies communicate with each other when there’s an accident involving multiple vehicles and drivers. If you don’t file a claim but the other driver does, it may appear as if you are trying to avoid taking responsibility. This casts doubt and raises questions. Your insurer will likely investigate why you failed to report it.

It’s best to be transparent by promptly reporting any at-fault accidents that cause substantial damage or injuries. This shows your insurance company that you have integrity.

Minor Accidents May Not Require a Claim

Now, let’s say you were at fault but the accident was very minor, with little or no visible damage and no injuries. For small fender benders where vehicles can still be safely driven, you may consider handling repairs directly with the other driver rather than filing an insurance claim.

For example, you scrape a neighbor’s bumper while parallel parking. The scratch is less than $500 to fix. Your neighbor agrees to handle it outside of insurance and you pay the shop directly. In minor cases like this, a claim could lead to increased premiums and be a loss for everyone if it doesn’t exceed your collision deductible.

However, it’s smart to document everything just in case. Take photos, get a written repair estimate, and have the other driver sign a letter acknowledging you are paying for their repairs as agreed upon. This protects you if disputes arise down the road.

If the at-fault damages appear extensive in any way, it’s safer to report it and allow your insurance company to handle the claim.

How Does an At-Fault Claim Affect Your Insurance?

When you file an at-fault claim, it will likely impact your car insurance premiums for several years. Here’s how:

• Rate increase: Expect a significant rate hike at your next renewal, often 20% to 40% or more. Multiple at-fault accidents will lead to even higher increases.

• Accident stays on record: The rate hike applies for 3 to 5 years before the accident stops impacting your premium.

• Loss of claims-free discount: If you had a claims-free discount on your policy, you will lose it for at least 3 years until you regain a clean driving record.

• Policy non-renewal: If you have multiple at-fault accidents within a short period of time, your insurer may decide to drop you. You’ll have to find coverage elsewhere, usually at a much higher cost.

While these insurance consequences can be difficult after an accident, it still pays to file the claim if there’s substantial damage or injuries. Your rates will eventually decrease if you go back to incident-free driving. Not reporting a major accident could lead to financial disaster and legal problems.

How to File an At-Fault Claim

If you’ve determined it’s prudent to file a claim, contact your insurance company as soon as possible. Provide details of what happened and ask how to proceed with the claims process.

Here are some tips for smoothly handling an at-fault claim:

• Report it immediately: Notify your insurer within 24 hours or as soon as reasonably possible. Delayed reporting could lead to denial of your claim.

• Be honest: Don’t try to bend the truth to avoid being blamed. Insurance companies have ways of determining fault accurately. Dishonesty only causes bigger issues.

• Keep thorough documentation: Write down key details while your memory is fresh and save related photos, video footage, police reports, etc. These help support the claim.

• Cooperate fully: Return your insurer’s calls promptly, provide requested documents, and inspect your vehicle when needed. Non-cooperation can also lead to a denied claim.

• Pay your deductible: Your collision or liability deductible will need to be paid out-of-pocket before repairs are made. Be ready for this expense.

• Keep making premium payments: You must continue paying your regular premiums on time, even when a claim is open.

• Do not admit full fault just yet: While it’s important to be honest, don’t jump the gun and admit 100% fault until the insurer finishes investigating. There are sometimes shared liability situations.

• Discuss payout timing: Ask when you can expect the claim payments to be issued so you know when repair shops or medical providers will be paid.

• Consider consulting an attorney: For major injury claims, speaking with an attorney can help protect your rights and navigate the claims process.

Alternatives to Making an At-Fault Claim

Some drivers consider not reporting an at-fault accident to keep rates from going up or avoid the claim process headaches. This is inadvisable for moderate to severe accidents. But for very minor mishaps, here are some alternative options to handle it outside of insurance:

• Pay out-of-pocket: As mentioned earlier, you may pay for someone’s small damages directly if agreed upon and you get documented confirmation.

• Use a credit card: Some premium credit cards provide collision damage waiver benefits for rental cars. This may cover minor rental car damages without filing a claim.

• Tap savings: If you have money set aside for emergencies, you could use those funds to pay for someone’s minor repairs yourself.

• Borrow money: You could take out a small personal loan to pay for minor damages that you want to handle without filing a claim.

However, proceed with extreme caution if trying to handle at-fault damages without insurance. There are many risks, and it’s illegal in most states for moderate to severe accidents. For major damage and injuries, making a claim is your best option.

Common Claim Filing Mistakes

Avoid these errors when filing your at-fault accident claim:

• Not reading your policy: Understand your coverages and limits before choosing what/how to claim.

• Not getting a police report: Having an official report provides key details for the claims process.

• Delayed reporting: Reporting the claim more than 48 hours later can jeopardize your claim.

• Withholding details: Being dishonest about what happened can get your claim denied.

• Poor documentation: Lacking photos, video footage, repair estimates, etc. makes claims harder to verify.

• Rude behavior: Being impatient or acting out with your claims adjuster hinders the process.

• No follow-up: Failing to follow up on your claim status frequently can cause delays.

• Using unapproved shops: Insurers require you to use shops in their network for covered repairs.

• Ignoring your deductible: Don’t assume your deductible is waived. Have those funds ready.

Avoiding these mistakes helps your at-fault claim process go as smoothly as possible.

The Bottom Line

Getting into a car accident can be upsetting, especially when you’re deemed at fault. Your natural reaction may be to avoid the issue entirely by not filing a claim. But for any sizable property damage or injuries to others, submitting a claim is the proper way to handle