What is an insurance claim and when should you file one?

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In a perfect world, you wouldn’t need auto insurance. But you carry an auto policy to protect yourself against unpredictability on and off the road. With that in place, if you ever get into an accident or a thief takes off with your car, you have something to help cover the cost.

Getting your insurance policy to kick in means filing an auto insurance claim. If you ever need to call on your policy, you’ll want to know what to expect of the auto insurance claim process. You’ve come to the right place.

What is a car insurance claim?

An auto insurance claim is basically your way of notifying your insurance provider that you’ll need to use your policy to cover expenses. The auto insurance claim process varies from provider to provider, but it usually starts with a phone call or filling out an online form.

When would you need to start the insurance claim process? Any time something happens that your policy covers. So, for example, you might file a car accident insurance claim after getting into a fender-bender. Or if you have comprehensive coverage, you could call your insurer if your car gets stolen.

Really, when you’ll file an auto insurance claim depends on the types of coverage you have. So let’s look at some of the most common coverage types:

  • Liability coverage: This steps in when you cause an accident or do damage with your car. Most states require you to have bodily injury liability coverage if you hurt someone else and property damage liability coverage if you damage someone else’s car, fence, mailbox or other property while you’re behind the wheel.
  • Collision coverage: While your liability coverage can fix someone else’s car if you’re at fault and their liability coverage can fix yours if they caused the accident, you still need insurance to fix your own car in an accident you caused. That’s where collision coverage steps in.
  • Comprehensive coverage: This is essentially insurance designed for non-driving risks. It protects your car against theft, vandalism and falling tree branches, for example.

The more coverage you add to your policy, the more you’ll pay. But you’ll also be protected against more risks, which means your car insurance claim can pay for issues so you don’t have to.

When should I file a car insurance claim?

Generally, there are more cases when you should file an auto insurance claim rather than skip it. Here are a few key examples:

You’ll save money

You should file a car insurance claim whenever your out-of-pocket costs would extend past your deductible. Reminder: your deductible is the amount you’ll pay for certain auto insurance coverages to kick in. For example, if you do serious damage to your car — say, you back into something large and do $1,500 of damage — and you have a $500 deductible, you’ll really get $1,000 for your auto insurance claim.

You caused an accident or damage to someone else’ car or property

Even if the other person recommends settling the damages from an accident privately, don’t take them up on it. If you settle privately, there’s always a risk that person could come back and ask you for more money.

By getting your insurance company involved by filing an insurance claim, you don’t just get your policy to cover the expenses, up to your policy limits. You also give yourself some protection by letting the insurance company handle settling up with the person you hit.

Someone hit your car

If your car takes damage because of someone else’s mistake, you’ll probably be wondering how to file an auto insurance claim against someone. Generally, starting the insurance claim process there requires a call to your own insurer and a call to theirs. Get their insurance information so you can start the car insurance claim and get the money you deserve.

People were injured in an accident

Whether you caused the accident or not, it’s a good idea to get your insurance company involved if people were hurt. That way, those people can get the medical care they need and use insurance as much as possible for it.

Is there ever a time I shouldn’t file an insurance claim?

Even though it’s almost always a good idea to go through the insurance claim process for the financial and legal protection it provides, there are a few times you may consider skipping it:

The damages are extremely minor

If you are involved in a minor accident and all parties involved do not want to file an insurance claim then you may not need to file one. But this is only the right call if you can settle up with the person right then and there. If they ask for your contact information — and especially if they ask for your insurance information — start researching how to make an insurance claim with your provider.

You damaged your own car

If you make a mistake behind the wheel that affects your vehicle but doesn’t hurt anyone else or their property, assess the damages. If the repairs are less than or close to your deductible, it probably makes more sense to pay for them yourself since you would cover most of the repair costs out-of-pocket anyways. That saves you from filing an insurance claim, which can cause a rate increase.

How will an insurance claim impact my car insurance rates?

When your insurance provider decides how much to charge you for your policy, they take quite a few factors into consideration. One of the key ones is your risk out on the road. And when you file a car insurance claim for an accident or damage you caused, you basically tell them that you’re risky. That means you can expect a rate increase.

If you did serious damage or caused injuries, you’re looking at a rate increase of about 34%. That incident should fall off your driving record after about three years, though, at which point your rates will go back down.

Some insurance providers offer accident forgiveness programs, even if you were at-fault in the accident. Accident forgiveness can protect you against rate increases after certain (usually, minor) accidents, so enroll in this program if your provider offers it.

Frequently asked questions

Do I need a police report to file an insurance claim?

Not necessarily, provided you can get the necessary information (like proof of damages) to your insurance company. But getting a police report can help you in two ways when you’re figuring out how to file an insurance claim.

First, the report gives you evidence of the accident. This can be especially helpful if the other driver was at-fault and you need to prove it.

Secondly, many states require that certain accidents get reported to law enforcement. Usually, you need to report the accident when the damages exceed a certain dollar amount or someone was injured. By getting the police report, you make sure you’re covered there.

How do I file an insurance claim?

Most insurer’s have a number you can call to start a claim and/or offer an online claim form. When you need to make a car insurance claim, give them all the requested information to get your auto insurance claim process started.

Is a car insurance claim ever legally required?

No. But if you’re thinking about filing a claim, there’s probably a timeline in place. Look up your deadline for submitting your car insurance claim so you don’t miss your window and miss out on your policy benefits. You’re paying those premiums for a reason, after all.

Written by
Kacie Goff
Personal Finance Contributor
Kacie Goff is a personal finance and insurance writer with over seven years of experience covering personal and commercial coverage options. She writes for Bankrate, The Simple Dollar, NextAdvisor, Varo Money, Coverage, Best Credit Cards and more. She's covered a broad range of policy types — including less-talked-about coverages like wrap insurance and E&O — and she specializes in auto, homeowners and life insurance.