As a driver, you know the importance of obtaining auto insurance. In the event of an accident, it will protect you and pay for any damages. But what happens if your auto insurance company disputes your claim? Conflicts over auto insurance claims are common, and knowing how to handle them can save you a lot of stress, time, and money. This article will discuss everything you need to know about car insurance claim disputes.
Why Your Car Insurance Provider May Dispute Your Claim
Car insurance claim disputes can arise for various reasons, so understanding them is essential to avoid complications. But why would an insurance company dispute your claim? Insurance companies may deny your car insurance claim disputes for various reasons, including the following:
- The policyholder’s carelessness caused the accident.
- The policyholder didn’t supply accurate information upon buying the policy.
- The policyholder was using drugs or alcohol while driving.
- The policyholder failed to follow the contract terms, including the requirement to report the accident and promptly assist the insurer’s investigation.
Car insurance claim disputes are rampant, with the average dispute value rising by 5% from 2016 to 2020, per a 2020 report by the Insurance Research Council (IRC). The study also discovered that disputes arise in about 13% of all auto insurance claims. These statistics emphasize the importance of comprehending your policy and knowing your rights as a policyholder.
If caught up in a car insurance claim dispute, seeking legal counsel from an insurance dispute attorney is imperative. These experts in insurance law can guide you through the court system to settle conflicts with your insurer. According to a report by the American Bar Association, an attorney by your side can improve your odds of a successful outcome in a car insurance claim dispute.
It’s Important to Thoroughly Understand Your Insurance Policy
Knowing your insurance contract inside and out is one of the best strategies to prevent disagreements over vehicle insurance claims. When examining your policy, bear in mind the following essential points:
- Your policy’s limits and the kind of coverage you have.
- The deductible and any other costs connected with your insurance.
- The circumstances in which your coverage is applicable, such as theft, car accidents, or weather-related damage.
- Any restrictions or exclusions that might apply to your coverage.
According to a National Association of Insurance Commissioners (NAIC) survey, only 45% of consumers believe they understand their insurance coverage. Understanding your policy can help you avoid losing time and money or experiencing stress in a car insurance claim dispute. Luckily, you can better understand your policy and get the best pricing for your needs by working with an affordable insurance broker. The experts help you compare policies from numerous insurers and discover the coverage that best suits your situation. 41% of consumers use an insurance broker or agent to buy vehicle insurance, per a JD Power study.
How to Fight Back on a Claim Dispute
According to the Consumer Federation of America, the average settlement for policyholders who retained an attorney in car insurance claim disputes was three and a half times bigger than for those who didn’t. This fact explains why you should consider hiring an accident lawyer to represent you in court.
Car insurance claim disputes can be challenging, and you must seek legal counsel to safeguard your rights as a policyholder. A knowledgeable car accident lawyer can make you understand your rights and negotiate with your insurer on your behalf. They can also fight for the just compensation you deserve in court. Below are some tips to ease the fight back if you find yourself in a car insurance claim dispute.
- Examine your insurance thoroughly and compile all necessary documentation, including witness testimonies, police records, and pictures.
- Negotiate with your insurer and give them the supporting documentation you’ve gathered.
What Liability Coverage Is For
Your car insurance policy must include liability coverage. It offers financial protection if you are at fault for an accident resulting in property damage or injuries to others. Liability coverage consists of two types of coverage: bodily injury liability and property damage liability. If you cause bodily harm to another person in an accident, bodily injury liability will pay for their medical bills, lost income, and other costs. On the other hand, if you accidentally damage someone else’s property, your property damage liability will pay for the necessary replacement or repairs.
Most states mandate liability insurance, though the minimal standards differ from state to state. Reviewing your state’s regulations is vital to ensure you have enough coverage. ValePenguin reports that most states require the following minimum liability coverage limits:
- $25,000 for each person’s bodily injury responsibility
- $50,000 for culpability for physical harm per incident
- $25,000 for each accident’s fault for property damage
It’s important to understand that these are merely minimal requirements, and getting more coverage than the minimum is always better to protect oneself fully. Suppose the expenses surpass the amount of liability coverage you have. In such a case, your assets can be in jeopardy, and you might be held personally liable for the deficit.
Therefore, you should choose a repair facility that will cooperate with your insurance provider. Also, check the types of parts they use for repairs. While some auto body shops only use original equipment manufacturer (OEM) parts, others may use aftermarket or used components to reduce expenses. It’s also important to note that liability insurance usually doesn’t pay for your injuries or vehicle damage. For that, you’ll require collision insurance. In the next section, we’ll discuss what collision coverage entails and what it covers.
What Collision Coverage Handles
When your automobile is damaged in a collision, your insurer will pay for repairs regardless of the party at fault. This kind of insurance usually covers body collision repairs, including repairing dents, replacing fenders, and fixing or changing other damaged car elements. Although collision coverage is optional protection, it may be essential if you are in an accident and require repairs.
According to WalletHub, collision insurance costs $382 per year. This figure may change depending on the extent of the damage, the kind of car, and other elements. Having collision coverage, however, can ease the financial burden of an accident and help you repair your vehicle.
Collision coverage can take care of several sorts of damage to your car, including damage from striking a pothole or hitting an object like a tree or a pole, in addition to body collision repair. It’s vital to understand that collision coverage does not cover damage to another person’s automobile or property. You’ll need liability insurance for that.
What to Expect From Comprehensive Car Insurance
Comprehensive auto insurance, commonly referred to as ‘other than collision’ coverage, can pay for various vehicle losses, including car body repair. This kind of insurance can cover damage from burglary, vandalism, fire, hail, and other events. You may drive confidently, knowing you have comprehensive coverage against unforeseen circumstances.
According to Bankrate, a comprehensive car insurance claim dispute costs $2,014 annually. But depending on the kind of damage and other elements, this figure may change. Yet, comprehensive coverage may offer financial security if your car is damaged in a covered incident.
Understanding the scope of comprehensive auto insurance requires reviewing your contract. Specific insurance could include restrictions or exclusions. For instance, the insurance may not pay for earthquake or flood damage. A deductible is another option. This is the sum you are responsible for paying out-of-pocket before your insurance starts to pay.
Why You Should Always Have Uninsured and Underinsured Motorist Coverage
This is a crucial type of insurance protection that can shield you if you are involved in an accident with a driver who is uninsured or has insufficient insurance coverage. This kind of insurance coverage can assist in covering the costs of car collision repairs, medical bills, and other accident-related expenses. Without this protection, your financial obligations could be significant in the event of an accident.
According to the Insurance Information Institute, almost 13% of US drivers lacked insurance in 2019. As a result, there’s a danger that the other motorist won’t have insurance to pay for your expenditures if you get into an accident. You can protect your financial security by having uninsured and underinsured driver coverage. The criteria and restrictions for uninsured and underinsured motorist coverage may vary based on the state in which you live. Review your policy carefully and talk to your insurance agent to make an informed decision.
How Collision Repair Shops Handle Insurance-Covered Repairs
Collision repair shops can take care of the insurance-covered repairs when you have to fix your car after a collision. These businesses frequently cooperate with your insurance provider to ensure your policy protects the repairs. Some auto repair companies may utilize used automobile parts rather than new ones to reduce prices, which can be a more cost-effective solution. They recover used car parts from other cars that have been in accidents or have been scrapped but are still in good condition. Using these parts can reduce the cost of repairs while still getting your car back in a safe and reliable condition.
What You Can Do if Your Car Is Totaled
If your car is deemed a total loss following an accident, you might think you have no other option. Yet, there are several actions you could take to increase the worth of your vehicle. Here are some ideas to help you.
Sell Your Car for Cash
You can get cash for cars by selling your totaled vehicle. Numerous companies specialize in buying damaged vehicles and making cash settlements for owners. To secure a fair price, get many quotations before selling it, and pick a trustworthy company.
Negotiate with Your Insurance Company
You can bargain for a bigger payout if you think the settlement offer from your insurance carrier is unreasonable or does not accurately represent the worth of your car. Research comparable automobile listings, current repair bills, and other pertinent evidence to support your car insurance claim disputes and make a case for a greater settlement. Insurance companies base their settlement offers on aspects such as the car’s age, mileage, and condition, so give data proving your vehicle’s actual value.
Consider Gap Insurance
The purpose of gap insurance is to pay the difference between your balance on your vehicle’s loan and its actual cash value. If your automobile is totaled, gap insurance can assist in covering the difference, preventing you from having to pay for a car you no longer have. If you have gap insurance, mention it when filing car insurance claim disputes with your insurance provider so you may get the highest compensation.
Adding on Services While Getting Insurance-Covered Repairs
Your insurance pays for the automobile repairs and other services. For instance, custom auto paint is a standard service. Little touch-ups to complete color changes are all possible with custom auto paint jobs, which may give your car a distinctive and individualized appearance. The Drive reports that a custom car paint job costs roughly $3,500. Although this may seem like a lot, it may be a great investment if you want to sell your car for cash.
Another service to consider when getting insurance-covered repairs done is detailing. Your car can receive a thorough cleaning from detailing services, bringing back its original luster. This may be particularly crucial if your car needs further care after a collision. According to NerdWallet, a professional detailing service typically costs around $300. Even though it may appear insignificant compared to the cost of repairs, this can significantly impact how your automobile feels and looks.
While getting repairs that your insurance covers, consider upgrading your car’s audio system. You may improve your listening experience and increase the value of your automobile by upgrading the audio system. While it may not be necessary for everyone, this can be an enjoyable and valuable addition to your car.
Understanding what your auto insurance covers is essential for safeguarding your investment and ensuring you have the money to deal with unforeseen mishaps. You may protect your funds and car if an accident occurs with comprehensive coverage, collision coverage, uninsured and underinsured motorist coverage, and gap insurance. You can confidently handle car insurance claim disputes with the proper knowledge and approach.