How Does an Auto Insurance Claim Work?

April 9, 2017

Every driver that owns and operates a car must carry auto insurance by state law. Auto insurance pays for damages and losses that arise as a result of car ownership. For instance, if you rear end another driver, your liability auto insurance will cover the damage to the other driver’s vehicle. An auto insurance claim is an official request for payment under the terms of an insurance policy.

Insurance Plan Terms:
If a loss occurs that is covered by your insurance plan, you must make a claim to get money from your insurance company. The types of expenses and losses that are eligible for claims will be spelled out in detail in your insurance policy. You should review the terms of your insurance policy thoroughly after, and preferably before, getting into an accident so that you know what types of expenses you can claim and the limitations of your policy. You must typically make a car insurance claim within a certain period of time after an accident has occurred to receive compensation; it is often best to make a claim as soon as possible after an accident occurs.

Making a Claim:
To make an auto insurance claim, you must call your insurance provider and give them all the relevant information about your insurance policy and the accident related to the claim. Even if the accident was not your fault, you may benefit from filing a claim as soon as possible. If the other driver is uninsured or has inadequate insurance, your insurance company may still have to cover damages done to you and your car. Many car insurance policies include rental car coverage; meaning your insurance company will pay for you to drive a rental car until you get our vehicle repaired or buy a new vehicle.

Damage Assessment:
After you make an auto insurance claim, the insurance company will evaluate the damage done to the car to determine how much money to pay you. If the cost of repairing the car exceeds the value of the car, it may be declared a total loss, in which case the insurance company will pay you the full value of the car, up to your insurance limits.

Insurance companies may claim that the value of your car, or the damage done to the car, is lower than its actual value. If you do not agree with the evaluation done by the insurance company, consider getting an appraisal from an unbiased third party. You must also pay your deductible before your insurance company will pay you. If your car suffers minor damage, the cost of repairs may not exceed your deductible. In this case you would not have to make a claim.

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