Monday, August 9, 2010

5 Reasons Why You Should Consider Having Your Auto Insurance Company Handle Your Collision Damage

I frequently get asked this question: "Why Should I use my own auto insurance company to (repair) (total) my car when the accident wasn't my fault?" In a perfect world, the at fault party's insurance company will immediately send an adjuster to appraise the damage and begin repairs or make an offer on your totalled car. Frequently, however, there can be delays of days or weeks while the at fault driver's company "investigates" the crash. In the meantime, you're stuck with a wrecked car and possibly no rental.

But if you have collision coverage with your auto company, here are 5 good reasons to IMMEDIATELY notify your company and insist on having them handle the matter:

1. In Ohio, your insurance company cannot increase your future auto insurance policy premiums for claims you submit that were not your fault;

2. Your own auto insurance policy may give you the right to an appraisal if there is a dispute about what you are owed. You will have no such right against the responsible party’s insurance company;

3. In some cases, the responsible party may not have enough coverage to fully repair or replace your car, particularly in multiple vehicle accidents where the at fault party’s policy limits must be divided among many damaged cars;

4. If liability is disputed (you claim you had the green light and the at fault party claimed that HE had the green light), the at fault party’s company may only offer you a fraction of the repair/replacement costs. Example: The at fault insurance company might say,“We think you may have run the red light and we think you are 50% at fault so we are only offering you $1,500 for your $3,000 repair bill.” Your own
insurance company can’t make this argument if you have collision coverage, since it covers you if you are completely at fault or free from fault . . . and

5. Finally, if your insurance pays a DIME for repairing/replacing your car, it will get back any money it pays from the at fault party’s insurance company. This is known as “subrogation,” and insurance companies are very sophisticated in pursuing their subrogation/reimbursement rights.

BOTTOM LINE: Notify your insurance company immediately after the crash, and start the ball rolling with them to fix your car if you have collision coverage. DO NOT LET YOUR AGENT TELL YOU THAT YOU MUST “GO THROUGH THE AT FAULT PARTY’S INSURANCE COMPANY” TO GET YOUR CAR FIXED. This is not only wrong, but illegal in Ohio under the Ohio
Administrative Code (OAC) section below:

Except as otherwise provided by policy provisions,an insurer shall settle first party claims upon request by the insured with no consideration given to
whether the responsibility for payment should be assumed by others.

Your claim is a “first party” claim whenever you are dealing with your own company. Therefore, your agent/company cannot legally tell you that you must “go through the at fault party’s company first” because of the section of Ohio law noted above!

This does not mean that you should NEVER attempt to have the at fault party’s insurance company pay for your car repairs. Many times, the at fault party’s company steps up to
the plate, and promptly and fairly takes care of any repairs/replacement. But you should know that, in some circumstances, it CAN be better to have your company handle the loss, because it gives you more options and rights.

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