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Can You Negotiate With Your Insurance Over Car Repair Costs?

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Most people don’t enjoy trying to negotiate dollar amounts with salespeople or companies they do business with. You may feel embarrassed trying to haggle prices or believe it isn’t your place to ask or that it won’t do any good.

Owning and repairing a car can be expensive. However, not negotiating with your insurance company over the amount of your reimbursement after a car accident can be a financial mistake. If you don’t receive enough money from your insurance settlement, you could suffer financially. You can – and you should – negotiate with your insurance over repair costs when necessary to ensure a realistic, fair reimbursement after a car accident.

You got in a wreck. What happens at the scene of the car accident?

Getting into a car accident can be a scary event – and there can be a lot of uncertainty. Your mind may race with all kinds of questions: Are you OK? Is your car totaled? Who’s at fault? But you can take some of the uncertainty out of an accident by reviewing and considering following these steps if you’re in an accident.

Do a status check and move to safety: When you get in a car accident, the first thing you should do is make sure you and your passengers are safe. If you are in a minor fender bender, move your car to the side of the road, out of the way of oncoming traffic. In the event of a serious accident, or where your car cannot be moved – cones, warning triangles, or emergency flares should be set up to prevent secondary accidents.

Gather information: If your accident involves another vehicle, you should exchange information with the other driver. Collect the following information:

  • Name
  • Address
  • Phone number
  • Insurance company
  • Policy number
  • Driver license number
  • License plate number
  • Owner of vehicle, if different from driver

Don’t admit fault or make promises: While you are exchanging information, avoid taking blame for the accident, even if you think it was your fault.

Don’t agree to not file an insurance claim at the scene, even if you think you won’t. Even minor damage can cost more to fix than you or the other driver might expect. If the other driver promises to pay to fix your car, what happens when he doesn’t follow through? Or if he changes his mind and reports the accident? Make sure your insurance company has your version of the story from the start.

Consider calling the police: In most cases, you should contact the local police or highway patrol – even if the other driver insists that is not necessary. Law enforcement officers may not actually respond to accidents that do not involve injuries. However, you may need a police report later, especially if there is some argument about who was at fault in the accident, or if you or the other driver report damages or injuries later. Get a copy of the police report.

Call your insurance: Contact your insurance company, even if you don’t think you will submit a claim, or if the accident was the other driver’s fault. Your insurance card should have a phone number and instructions for what to do. Ask the insurance representative if you are required to notify your state department of motor vehicles. Contact your state DMV to find out what your requirements are.

Document the car accident: Nowadays, most people take out their smartphones and snap pictures of the wreck. But it’s not just for social media; documenting what happened (to both vehicles), where, and how, is important. If there are witnesses at the scene of the accident, ask for their contact information.

Visit your doctor, if needed: If you may be injured, see medical attention as soon as possible. Back and neck injuries are not always apparent right away, and feeling “a little stiff” after an accident is enough of a warning sign that you should seek professional care. Not only will you be taking good care of yourself, but you’ll document any injuries from the wreck.

What’s the car insurance claim process like?

Follow your insurance company’s instructions for filing a claim. In most states, the insurance company of the driver at fault pays for the accident. Your insurance company may tell you to file with the other driver’s insurance company, or they may do it for you. But if you live in a no-fault state – or if the driver at fault does not have adequate (or any) insurance – you’ll file a claim with your insurance company, and they’ll pay the bill.

After you file a claim, the next steps may vary based on the insurance company, the severity of the accident, and whether anyone was injured.

With a minor accident, you may never see the adjuster in person. The adjuster may request documentation, such as a police report, and have you get an estimate from a repair shop.

The adjuster may also ask you for more information about the accident to help determine who was at fault. Not all accidents are 100% attributed fault to one driver. The adjuster may decide you were partially at fault, and split the cost of the settlement with the other insurance company accordingly.

The more serious the accident, the more involved the investigation is likely to be. The adjuster may not only look at the police report, but he may contact the other driver and any witnesses, visit the accident scene and inspect your car and take photos of it. If you were injured, you may need to sign a medical release so they can view your records.

The insurance company then determines how much to reimburse you for your claim. You may need to get estimates from a body shop as instructed by your insurance company.

Do I have to get my car repaired at my insurer’s preferred auto shop? You can typically get your car repaired at a body shop that’s not on the insurance company’s list. However, you may have to pay the difference if they charge more than the approved shops. Another reason to use the approved shop is that if they discover more damage when they start working on your car, they may directly contact the insurance company themselves and get authorization to continue.

Some insurance companies ask you to get estimates from more than one repair shop. That’s more work for you, but it may be required.

Negotiating with your insurance company

If you’re not happy with the way your insurance company handles your claim, you don’t have to give up in the first round. You can try several ways to resolve your claim to your satisfaction.

The first thing you can do is communicate with your insurance company. Complaining about your reimbursement isn’t likely to help. Showing estimates and other facts to the adjuster, on the other hand, may very well give you the bigger settlement you need.

Keep records and notes of all communications with the adjuster and insurance company, and don’t let them rush you. It’s tempting to take the cash when it’s first offered and you need your car fixed. But if the amount is not sufficient for your expenses, it’s better to take your time and make sure your claim is treated fairly.

Escalate your claim, if needed. If you’ve tried to negotiate with the adjuster assigned to your case without success, try taking your claim to the adjuster’s supervisor or another contact at the company, before you look for outside help.

If you don’t get an acceptable resolution from your insurance company, you can get a third party to help resolve the issue. The third party may be an arbitrator, mediator or appraiser.

If significant amounts of money are involved, you may hire an attorney or a “public claims adjuster” to help you get a higher settlement. If you want to file a complaint or take other actions with your state, contact your state’s department of insurance.

What happens if you still can’t afford car repairs?

After you do your best to negotiate with the insurance adjuster, you may still not have enough reimbursement funds to cover your repairs. In some cases, you may not know until later that you need additional repairs related to the accident. What are your options if your claim has been settled, and you’re still short of cash for repairs?

If you need cash to pay for repair bills and other expenses over the amount of your final insurance payout, consider these options:

  • Personal loan: An unsecured personal loan may be a viable option to cover repair costs if you don’t have enough cash on hand. You’ll need good credit to qualify, but you won’t have to put down collateral to secure the loan.
  • Credit card: A credit card can help in an emergency. Be careful of running up debt with high interest rates, however. If you have good credit, consider getting a card with an introductory low- or no-interest rate. Pay off the balance off before the introductory period ends to avoid racking up interest charges.
  • Payday alternative loan (PAL): A PAL is offered by credit unions and is an option for borrowers with lower credit scores. Note that you’ll need to be a member of a credit union to qualify for a PAL. However, this type of loan may help you avoid payday loans and similar short-term loan options that come with exorbitant interest rates and fees that can drag you deeper into debt.
  • A loan from a family member or friend: This may be a solid option if you want to avoid paying interest and only need to borrow a small amount of cash. Only consider a person-to-person loan if you’re sure you can pay it back, that you’re not jeopardizing the financial health of the lender, and you have a solid relationship with the other person.

How to avoid needing to negotiate with your insurance

The only thing better than successfully negotiating with your insurance company is avoiding the need to negotiate in the first place. You are also less likely to have a problem with your insurance claim if you take good notes and photographs at the time of the accident, file a police report, and call your insurance company immediately rather than if you try to piece information together some time later when you decide to file a claim.

You may also avoid problems being reimbursed for a fair amount by using a body shop approved by the insurance company.

And of course, choose your insurance company carefully, and make sure you know your coverage and deductibles. Insurance is a substantial part of the cost of owning a car, but when you have an accident, having insurance turns out to be vital.


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