Out of Pocket Settlement Vs Insurance?

[INSUREGEEK]

If you've got $2500 or so laying around, go ahead and settle out of pocket. Keep in mind there could be hidden damage to the car, plus a rental car if the guy wants one. I don't think you have that kind of cash because you seem very worried about the premium increase.

So....turn it in. Let the insurance co deal with repairs and rental cars. That's what you've been paying for.

Also get your mirror checked out by a body shop. Some of them are pretty fancy and can cost upwards of $1500 to replace. Others can be done for well under your $500 deductible.

Good Luck!

 

[desidude]

If you've got $2500 or so laying around, go ahead and settle out of pocket. Keep in mind there could be hidden damage to the car, plus a rental car if the guy wants one. I don't think you have that kind of cash because you seem very worried about the premium increase.

So....turn it in. Let the insurance co deal with repairs and rental cars. That's what you've been paying for.

Also get your mirror checked out by a body shop. Some of them are pretty fancy and can cost upwards of $1500 to replace. Others can be done for well under your $500 deductible.

Good Luck!

Actually I do have the cash. My main concern at this point is using up my "first premium raise" on this incident and then waiting for 6 years and hoping another one doesn't happen which would trigger an even bigger premium raise.

If I paid out of pocket, then I avoid the first premium raise for any future incident which means my premium won't shoot up to the skies in case of a 2nd incident after this one. The only drawback is the nuisance of making sure the guy doesn't come back with additional issues or how to close this chapter for good (getting a proper letter for him to sign with no loopholes).

With either option I end up paying roughly the same amount so it doesn't matter in terms of a cost benefit (Premium raise over 6 years vs Paying that amount of out pocket) but the risk involved in going out-of-pocket vs the risk of getting into another accident in the next 6 years and premium sky rocketing (i.e. saving the first premium raise for a future accident instead of using it up here).

If that makes any sense...?

 

[INSUREGEEK]

That makes perfect sense!

I didn't mean to sound insulting about having the cash. Most people offer to pay out of pocket and then hyperventilate when they see the estimate. My apologies.

I'd still turn it in. It is a liability claim.....there's no real way you can guarantee that this guy won't come back to you years from now with injuries or damages. Heck, you might not make out of this one without additional costs beyond what you're prepared to spend. And then it might be too late to get the insurance involved.

If we were talking about a comp or collision claim, I'd probably tell you to just pay for the repairs yourself.

 

[djs]

In CA, you are only surcharged for the accident for a maximum of 3 years. It stays on your record for 6 or so, but that doesn't mean its rated for that long.

Some carriers do have an additional 'claims-free' style discount that may apply through the 6 years, but that is usually more like 5%, not 30%.

Not all carriers walk the surcharge down, some do, some don't. Those that don't are frequently lower to start out with, but the total tends to be about the same. Figure 30% average over 3 years:

130 x 0.3 x 36 months = 1404

I'm definitely turning that claim in!

Dan

 

[desidude]

Thanks everyone for your advice...!

Turns out the insurance bump will be around $18$/month and so it is not that big a premium increase as I was thinking....

Decided to go the insurance route, got the ball rolling on that.

 

[jennellen]

If you do this claim as a report only claim and just put the carrier on notice, pay for this out of pocket, draft a release form and get a lawyer to approve it then get the claimant to sign it. Done deal.