No one ever expects to get into a car accident. But it happens. And when it does, it’s important to know what to do next. Do you file a claim with your insurance company? How will your rates be affected?
The Pros of Car Insurance After a Crash
Car insurance is a vital part of owning a car. It can help you financially after a crash, as well as help you get your car repaired or replaced.
If you are involved in a car accident, car insurance can help you pay for the cost of repairs to your vehicle. If your car is totaled in an accident, car insurance can help you replace it. In either case, car insurance can help you get back on the road after a crash.
There are also personal injury protection (PIP) and medical payments (MedPay) coverage options available through most car insurance policies. PIP coverage can help pay for your medical bills if you are injured in a car accident, regardless of who is at fault. MedPay coverage can help pay for your medical bills if you are injured in a car accident and the other driver is at fault.
Both PIP and MedPay coverage are optional in most states, but they can be vital protection if you are involved in a car accident.
The Cons of Car Insurance After a Crash
Your premiums will go up after a claim.
This is the most common downside of filing a car insurance claim. Your rates will almost certainly increase, sometimes by a significant amount. How much your rates go up will depend on a number of factors, including the severity of the accident, your claims history, the state you live in, and your insurance company. In some cases, your rates may only go up a few dollars per month. But in other cases, they may go up by hundreds of dollars per month.
You may have difficulty finding another insurer.
If you have a bad driving record or make too many claims, you may have difficulty finding another insurer that will cover you. In some cases, you may be forced to buy high-risk insurance, which is much more expensive than regular insurance. You may also be dropped by your current insurer. This can leave you without coverage for a period of time, which can be very dangerous.
Your policy may not cover the full cost of the repair.
If you have an accident, your insurance company will pay for the repairs to your car. However, they will only pay up to the limit of your policy. If the repairs cost more than your policy limit, you will have to pay the difference out of your own pocket. This can be a significant expense, depending on the extent of the damage.
You may have to pay a deductible.
Most car insurance policies have a deductible, which is the amount you have to pay before your insurance company starts paying for damages. For example, if your deductible is $500 and the repairs from an accident cost $1,000, you will have to pay $500 and your insurance company will pay $500. This can add up to a significant expense if you are in a serious accident.
While car insurance can be helpful after a crash, there are also some drawbacks to consider. It is important to weigh the pros and cons of car insurance before deciding whether or not to purchase a policy.