Accident Reported but No Claim, Still Went on Record

[Khemrajj]

I have a question,
I got into a minor fender bender a few days ago. I rear ended someone but it was making a left turn so it was really small. I made a report to the insurance company but me and the person i hit agreed for me to pay and get it fixed since it only cost $400 (new bumper painted installed and a rental). I called back TD to tell them i took care of it and the said its considered a claim since i was at fault and therefore will be on my record even though i dealt with it....Is that how it works? Seems unfair my rate will go up although it didnt cost them a penny

Thanks for your time!

 

[djs]

Just because its on the record doesn't mean it will impact rates. Insurance carriers will keep any claim opened on the record pretty much for forever, just in case.

In most states, even if the insurance company paid for this claim, it wouldn't have affected your rates. It doesn't usually work that way, but a good agent could have saved you the $400 you paid to do the repairs.

But to answer your question, a claim does not affect rates (except for perhaps some small, minor discounts) but at fault claims, depending on various factors, do. Your description is such that this probably wouldn't impact you at all.


Dan

 

[Khemrajj]

Great reply, thanks Dan!

 

[Aram Fingal]

I think what is really going on your insurance record is an "incident" more so than a claim. There are "chargeable incidents" and "non-chargeable incidents". Chargeable ones cause a surcharge on your rate. Non-chargeable do not. This one should be a non-chargeable and it shouldn't affect your rate much if at all. Some companies have an "incident" free discount instead of a "claim" free discount and they will sometimes remove the discount if you are involved in any kind of incident, whether your fault or not. If yours is one of those and you have that discount now, you might lose it.

The only other time it might come up is if you were to change companies. The company you're moving to may need more details about the incident to make sure they shouldn't be counting it as a chargeable incident.

The bottom line is, if your insurance company raises your rates as a result, shop around. If you're with an independent agent they will be able to do that for you.

 

[bps]

I've had an underwriter tell me unpaid claims should count, as having the accident is an indicator that the driver is more likely to have another. That being said, I've not seen a $0 paid out claim affect any rates.

 

[djs]

I guess its fortunate that underwriters don't make the rules, they just do what the rules say.

Now, that said, there is truth in what he said. One accident is a good indicator of another one coming, but in a lot of states, its not just a $0 accident doesn't count, even small claims don't count. Parking lot dings just aren't the same predictor as running a stop sign or turning left in front of oncoming traffic.

Dan

 

[bps]

I didn't agree with this when he told me, but in hindsight, it does make sense. Premium is based on the risk, and the risk changes with an accident. If someone has liability only, and backs their car into a mailbox (or anything) and causes say $3500 in damage, obviously that's not covered with no collision. Should they not have points when someone with collision would have points? That being said, I've never seen surcharges for a $0 paid claim and I'd prefer to keep it that way. I looked, but couldn't easily find a definition for surchargeable accident.

Edit: just looked at found the wording in the state information doesn't say anything about whether paid by insurance or not, accidents are classified by amount of damage or injury. Of course it may be hard to figure the amount of damage without a CLUE report or insurance claim payment.

 

[Indiana_Adam]

I believe SafeCo surcharges for $0 paid out auto claims within 3 years and then still impacts insurance score for up to 5 years. I've gotten into it a few times with my underwriter about it. Even if there isn't a direct surcharge, it may still impact insurance score with other companies, which could impact premium if it causes a rating tier/group change.