No one likes to think about getting into a traffic accident, but it’s important to plan ahead so you’ll know how to deal with insurance issues if you are involved in a collision. Here are seven steps you can take to make sure the insurance process proceeds as smoothly as possible.
1. Be prepared before it happens
While auto insurance policies don’t make for exciting reading, you need to understand exactly what’s in yours. “A lot of people don’t even know what their policies are,” says Michael Gutter, assistant professor of family financial management at the University of Florida.
“It’s important that you take a look at that. State laws vary. You’ll want to know what protections are there for you, particularly if the other person doesn’t have insurance.”
- Be prepared before it happens.
- Make sure everyone is OK, then call the police.
- Call your insurance company pronto.
- Gather information.
- Don’t admit guilt.
- Keep track of repairs.
- Treat parking lots like roads.
Make sure you have your insurance information — name of provider, policy number and phone number — in both your wallet and your glove compartment, as the glove compartment could be damaged in an accident.
It’s also a good idea to keep a disposable camera — unless you use your cell phone for a camera — and a pen and paper in the glove compartment.
2. Make sure everyone is OK, then call the police.
“Obviously the first thing you want to do is make sure everyone involved is OK,” says Kip Diggs, a spokesman for State Farm Insurance. If injuries are serious, of course, dial 911 for an ambulance. Otherwise, move your cars out of traffic to avoid another accident.
Experts advise that in any accident you should call the police. “Even if the other person says, ‘I’ll take care of you; I’ve got a brother-in-law with a body shop that can fix your car,’ you still want to call,” says Beth Hanlon, an agent for Allstate Insurance in Riverhead, N.Y.
That’s because you don’t know how things will turn out, and a police report will provide an official record of the accident. If you’re on an interstate highway, call county or state law enforcement.
If it’s a minor accident without injury or much damage, the officer will merely file an incident report, which functions as an information exchange. If the accident is more serious, the officer will create an accident report to assist the insurance process and establish legal liabilities.
Be aware that if it’s a minor accident, police officers may not come to the scene. “We don’t dispatch a police car to every fender bender,” says James Kenneally, a Boston police officer. “We can’t afford to, given our limited resources.”
And that’s not just the case in big cities. In Evanston, Ill., which has a population of about 75,000, Police Commander Tom Guenther says “if it’s a fender bender, we have people come in to the police department, and they can fill out forms there.”
3. Call your insurance company pronto.
People in the insurance industry say you should call your carrier regardless of the accident’s severity. If any payments have to be made to you or anyone else involved in the accident, the sooner your insurance company knows of the situation, the better. (To compare insurance policies and quotes, visit Insureme.com, a Bankrate company.)
However, Gutter says there are cases in which you don’t want to involve your insurer. State law often forbids insurance companies from raising your rates unless the accident was your fault, he points out. “But if you aren’t protected from rate hikes, I can see why someone would think twice (about calling his/her insurance company) if it’s just a fender bender.”
If you do decide to call your insurance company, don’t procrastinate. “Sometimes our customers will be in an accident, and the other guy will call first. That raises eyebrows,” says Hanlon. “Within a day, you should let your insurance company know.”
4. Gather information.
“If possible, take photos, including the surrounding area, traffic signs, lane markings and the damage to vehicles involved,” says Shawn Burklin, vice president of claims for GEICO insurance. “Photos can provide a wealth of information and assistance in handling your claim.”
Pictures are particularly important for accidents in parking lots or other private property, where police may not show up and it’s difficult to determine exactly what happened.
Write down the name, contact information and insurance information for the other driver. If the other driver doesn’t have proof of current insurance, you can call his or her carrier at the scene to verify coverage.
You also want to write down all of the accident’s details. “Your insurance company’s claims person will ask a lot of questions,” Hanlon says. “What direction were you traveling and on which street? Were there any stoplights or signs? They’ll also need to establish where the impact to your vehicle was.”
Try to get the names and contact information for any witnesses, so they can back up your version of events.
5. Don’t admit guilt.
Express concern for any injuries or damage sustained by anyone else involved in the accident, but don’t admit you were at fault.
“Admitting fault or responsibility is usually an emotional statement that isn’t well-thought-out,” Gutter says.
It may turn out you weren’t at fault.
“But because you’ve admitted liability, you take on yourself the cost of the wreck. Your insurance company would have to pay for the other person’s injuries, and you could see an increase in your rate as a result,” says Diggs.
He notes that if you acknowledge blame, the police investigation of the accident might not be as thorough as usual.
In conversation with the other driver, you don’t want to go beyond showing compassion and exchanging insurance and contact information.
“Don’t answer questions or make statements,” Gutter says.
6. Keep track of repairs.
Keep abreast of the repair process for your car.
“You don’t want to just leave it all to your insurance company,” Gutter says. “The insurer would like the repairs to be done in the least-expensive manner. You may not have a lot of options (in terms of where the car is taken and how damage is fixed). But the key thing is to make sure you have the right to have original manufacturer parts put in.”
If the other driver contacts you after the accident, you don’t want to get involved in discussions. Politely tell the person that your insurers will handle the situation.
And what if the other driver’s insurance company contacts you? Your own insurance company can help. “While you are not required to cooperate with the other party’s insurance company ? your claims representative will discuss the best way to handle your claim, which may include cooperating with the other party’s carrier,” says Burklin.
7. Treat parking lots like roads.
Treat parking lot accidents the same as road accidents. The crucial issue is who was at fault, just like in collisions on the road. But that’s not always obvious in a parking lot. “Often parking lots don’t have stop signs or lane markings, and it’s unclear who has the right of way,” Hanlon says.
“So a lot of the time it’s comparative negligence. Unless you were clearly stopped or parked, and someone just backed into you, there will be some negligence attributable to you.”