Monday, May 24, 2010

Should You Use Your Own Auto Insurance Company To Fix Or Total Your Car After An Accident?

Short answer: YES! Here are common misconceptions that I hear all too often from my clients shortly after an accident:

1. "My agent told me to go through the responsible party's insurance company first."

WRONG! If you have collison insurance with your own company, your insurance contract absolutely obligates your company to timely repair or total your car. Your policy, and Ohio law, does NOT obligate you to run the gauntlet of the at fault party's insurance company and their delay and low ball offers. All too often, crash victims in need of an estimate, a rental car, or an offer on their totalled car wait for days for the at fault party's insurance company to take care of the damage/loss. You can short circuit the dalay by insisting that your company immediately take care of your car.

2. "My agent said that my rates might go up if my company pays for my car damages."

WRONG again! Buried in your insurance policy is a "subrogation" clause. This means that if your insurance company pays a penny for your car damages, it will "subrogate" or obtain full reimbursement from the at fault party's insurance company.

3. "But I have a $1,000 deductible. My agent told me that they will have to subtract my deductible from any offer my insurance company makes on my car."

CORRECT....but only half true. The at fault party's insurance company will reimburse you for your $1,000 deductible shortly after the collision, and most body shops will work with you and simply wait for you to turn over the $1,000 when you receive it.

4. "I have rental coverage through my own company but my agent told me to first go through the at fault party's for a rental."

WRONG...and totally improper if you have purchased rental coverage with your insurance company. You pay a separate premuim for rental coverage, and the whole point of having it is to be entitled to immediate access to a rental car shortly after a collison, when you need it the most. Many of my clients report that the at fault party's company is too slow to offer a rental car. Worse yet, many companies tell accident victims: "go pay for a rental and we'll reimburse you later for reasonable rental charges," whatever that means. And many crash victims don't have the cash to plunk down on a rental car.

When you go through your insurance company, almost all of them will pay the rental agency directly.

These roadblocks are nothing more than your company's attempt to not have to get involved/pay anything by throwing everything back on the at fault party's insurance company. In a perfect world, the at fault party's company will step in and fairly take care of everything with no delay. All too often, however, this is not the case.

So you need to do two things to protect yourself. Get your insurance company involved immediately in your car's repair or replacement. Don't take no for an answer. And if you start to hear some or all of these excuses from your own company, it's time to drop your company and find a new one--and an agent who will work WITH you, and not against you.

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