Auto insurance specialists are cautioning drivers against failing to report traffic accidents to their providers.
Because of the economic recession, more and more Americans are choosing to increase deductibles and even discontinue their car insurance policies to save money. Some motorists have even gone so far as to settle damages with other parties outside insurance companies.
Experts are now warning drivers against the consequences of not filing claims or reporting car accidents, even minor ones. They say that although being involved in an accident means higher premiums in the future, this is actually better than dealing with damage costs personally.
Without proper coverage, motorists are left to settle car repair costs and even hospital bills with their own money. This can often lead to more expensive court settlements or liability payments. If an accident goes unreported, then the insurance provider no longer covers the costs that come with it.
Industry analysts also say that being held at fault for car accidents can lead to much higher insurance costs. Providers would weigh the consequences of having to cover the insurance of a driver proven to be at fault in a prior accident. They say that multiple involvements in several mishaps can increase insurance costs significantly.
Worse, a DUI can potentially smash any chances for renewing a policy. Because drunk driving is considered as one of the worst driving violations by most if not all insurance companies, providers rarely give coverage to drivers convicted of DUI. The nature of the violation and its severity can convince many insurers that a motorist can commit the same infraction in the future, proving himself to be a high-risk policyholder. At present, most providers reject applications for insurance policies by drunk drivers for a period of three years, analysts say.
Experts add that the increase in premiums after an accident depends on the discretion of most insurance providers. Some companies evaluate insurance rates based on the nature of the accident and the actual involvement of the policyholder. A driver can expect higher than usual premiums if found responsible for the mishap. Any injuries or deaths caused by a car crash can severely affect the insurance costs of a motorist in the future. Spotty driving records can spell potential risks for insurance companies because they say many things about a motorist’s driving behavior.
In the end, experts advise motorists to report any accidents whether they plan to file claims or not. They explain that doing so can potentially protect a policyholder from future liabilities.