What are the pros and cons of making a car insurance claim?
There are many benefits and downsides to making a car insurance claim.Yourindividual circ*mstances will ultimately determine what the best action to take is, as well as your insurance policy.Some pros to consider are:
More affordable if substantial damage has been caused
If the damage costs more to repair than the value of your premium, it may be worth making a claim. This is simply because it will save you money on the repairs, especially if the damage is substantial anyway.
Potentialpay-outtowards a new car if yours has been written off
Your car insurance policy maystate that the insurer will contribute towards the cost of a new car– ifyours is written off.Under these circ*mstances, it’s definitely a good idea toclaim and saveyourselfsome money.Even if your insurance goes up, you’ll probably still be betteroffinancially.
Access to a courtesy car
Again, your insurer might provide you with access to a courtesy car while yours is getting fixed or whileyou shop around for a new one. You’d need to claim in order tobenefit fromthis.
Reassurance that it is being dealt with properly
It can be stressful dealing with car repairs on your own, especially if you’ve been in a bad accident or its your first timehaving tomake repairs. The insurerwill be able to offer you advice and reassure you that the situation is being dealt with.
Cons of making a car insurance claim:
Make sure you also consider the cons ofmaking a car insurance claim, so that you make a well-informed decision. Some cons you should know aboutinclude:
Potentiallylosingyour no-claims bonus
If you have a no-claims bonus, you risk losing it by making a claim. Work out whether it would be more cost-effective to pay for the damage yourself, or to make the claim andlose that no claims bonus.This also depends on whether the incident was a ‘no-fault’ accidentor not, combined with your company policy.If you’ve protected yourno claims bonus, the number of years that contribute to it shouldn’t be affected by you making a claim.
Havingyour excess deducted from anypay-outyou receive
If you’re entitled to apayoutfrom your insurer, it’s likely that any excess you’ve agreed to pay will be deducted from this amount.In some cases,you could end up beingpaidrelatively littlefrom your insurer and your insurance getting considerably more expensive as a result of your claim.If this is the likely outcome, then you may want to consider not claiming.
Your insurance goingup
Insurers calculate the cost of your insurance based on various statistics. These include risk factors, likehow many claims you’ve made previously and how many accidents you’ve been in – whether you’ve claimed or not.It’s also worth noting thatyou shouldtell your insurer about the accidentanyway. Otherwise,yourpolicy could become void.
Being addedto the motor insurance database
When you claim on the insurance, even if it wasn’t your fault, the incident is reported on the motor insurance database. This gives insurers an indication of how risky you are. So, your insurance could go up even if you weren’t at fault,if your driving history suggests that you’re a high-risk driver.
How else can I reduce my car insurance rates?
In some cases, going through the car insurance claims process with your insurer may be unavoidable. However,there are other things you can do to help bring your insurance down:
Opt for multi-car insurance
Multi-car discounts can help to bring your premium down.This is basically where you insure multiple cars on the same policy. For example,yours and your partner’s, children’s or parents’ cars.
Take a Pass Plus course
APassPluscourse isa short, six-hourcoursethat helps inexperiencedandunconfidentdriversimprove their driving skills.There isn’t a test, but youhave toreach the required standard by the endof each modulein order to pass. Youhave topay for it, but it can knock a significant amountof money off your insurance.
Go for black box insurance
Black box insurance uses GPS technology to measure how you drive andcan be cheaper than traditional car insurance.Onceyourdriving has been assessed, the provider may reduce your insurance.However, they aren’t cost effective for unsafe drivers, so bearthis in mind.
[Pull quote]There are plenty ofother waysyou can reduce your car insurance rates, so it’s worthtaking thetime to do as many of these as you can. [Pull quote]
What is a fault claim?
There are two types of car insurance claims:
- fault claim
- non-fault claim
A fault claim doesn’t necessarily mean that you’re to blame for the accident. There are threeinstances where your insurer will file your claim as a fault claim:
- something youdid caused the accident
- someone who was driving your car caused the accident
- there wasn’t enough evidence to point towards somebody else as the culprit
For example,your car could be parked outside your housein the dead ofnightandsomebody vandalised it. If they were never caught, your insurer might put the claim down as a fault claim.
With a fault claim, your insurance company will be paying out for most of the damagescaused by the accident.
Does a non-fault claim affect insurance?
A non-fault claim is where the accident is provento be somebody else’s fault. Their insurance will pay out for most of the costs.
Yourinsurance is less likely to go up(or by a lower amount) with a non-fault claim.That being said,insurerscalculatehow risky you are as a driveron a variety of factors.Some insurerstake into accountthe number of claims you’ve made, whetherthey were fault or non-fault. It really depends on your insurer. So, if your insurance goes up by a lot after your claim, it may be worth shopping around for a new provider.
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