No one gets into a car accident and it is stressful when you consider who pays for the vehicle repairs. The fact is vehicle repair costs after a collision with another car or object are determined by one factor. Who is at fault? Fault determines who is responsible for vehicle repairs and can make the difference between saving a few thousand dollars or thousands more.
Insurance companies do not decide who is to blame. Liability and insurance coverages also play a factor in determining who is financially responsible.
Read on to learn more…
In This Guide
- How Fault Determines Who Pays
- Types of Insurance Coverage That Matter
- What Happens When the Other Driver Is At Fault
- Steps to Take After an Accident
- Managing Repair Costs Effectively
How Fault Determines Who Pays
Liability is determined and decided in the majority of states as the payment source for accident repairs. The driver who caused the accident is at fault and is financially liable for other damages. That means he or she has to pay for the vehicle repairs, medical bills, and other financial damages or losses. However, insurance companies do not just take someone’s word for fault or liability. Insurance adjusters look at the accident reports, witness statements, and photos of the damages. The at-fault driver’s liability insurance policy will cover the other driver’s accident repairs.
In no-fault states, the law is different. Every driver files a claim with their own insurance company for vehicle repairs after an accident. Each driver’s personal insurance covers the repair costs no matter how the accident occurred or who was at fault. Michigan, Florida, New York, and several other states use this type of system.
Drivers do not need to go it alone in the event of a vehicle accident. Working with collision repair services or a local body shop, drivers have assistance in dealing with insurance companies and auto repairs. Auto glass repair and windshield replacement services, for example, can easily be referred by the insurance company directly to the repair shop. Which makes vehicle repairs easier.
Types of Insurance Coverage That Matter
Insurance coverages vary widely. Coverage types also impact the outcome of a vehicle accident.
Liability coverage covers the other party’s damages and costs if the policyholder driver is at fault. Every state has minimum liability insurance requirements for drivers. State minimum liability insurance pays for the other driver’s car repairs and medical expenses.
Collision coverage pays to repair the policyholder driver’s vehicle after an accident. Collision insurance is optional on auto insurance policies. It is used no matter which driver caused the accident.
Comprehensive coverage takes care of non-collision damage. This type of coverage includes theft, vandalism, hail damage, and other events like hitting a dog. Comprehensive coverage also repairs glass damage in most instances.
Uninsured or underinsured motorist coverage protects a driver when another driver is at fault. However, the other driver has no insurance or does not have enough insurance. According to industry experts, average repair claim costs now exceed $4,600. Having this type of coverage is crucial.
Super important stuff, don’t you think?
What Happens When the Other Driver Is At Fault
The insurance company of the driver at fault pays for vehicle repairs. The driver with liability coverage that caused the accident has the financial responsibility to repair the other party’s vehicle. However, the process should work like this:
- File a claim with the insurance company of the driver at fault
- A claims adjuster will evaluate the damage to the vehicle.
- The insurance company will write a check based on the repair estimate.
- The vehicle is repaired at an insurance company approved or selected body shop.
There are some issues with this scenario. The at-fault driver or insurance company may dispute liability or fault. The insurance company may have coverage limits that are not enough to repair all the vehicle damage. Drivers may need to turn to their own collision insurance coverage and sort out who pays later with the insurance companies.
Something to keep in mind…
Even if the accident is not the driver’s fault, a claim may increase future premiums. Some insurance companies increase premium costs even after a not-at-fault accident. The percentage is low at only 4% to 6% higher for the average not-at-fault accident.
The Real Cost of Repairs Today
Auto repairs are more expensive than they used to be. Cars have more sensors, cameras, and safety equipment to keep track of and repair.
Collision repair industry stats show just how much. A recent report found that collision repair costs jumped 8% in the past year. Minor fender benders can easily run into the thousands of dollars for airbag sensors or rearview cameras that need replacement.
Windshield replacement services start at $200 and can exceed $1,000. There are many factors that can make the repair costs of a windshield replacement increase such as cars with rain sensors, heads up display, or lane departure warning systems will need to be recalibrated after the glass is replaced.
Insurance coverage is more important than ever.
Steps to Take After an Accident
Steps to follow after an accident can make dealing with insurance companies go much smoother. As soon as possible after a vehicle collision:
At the scene: Obtain insurance information from the other driver. Document all vehicle damage with photos of all the damage, surrounding areas, and any injuries. Collect witnesses’ names and contact information. File a police report if there are injuries or substantial damage.
After the scene: Call the insurance company as soon as possible. Most policies require the insured to provide timely notice of a collision. Put everything in writing and keep copies of all documentation and contact.
During the repair process: Obtain multiple repair estimates if possible. Ask questions about OEM or aftermarket parts. Understand what the insurance company covers before repairs start.
Managing Repair Costs Effectively
There are some tips and methods for saving money out of pocket for repairs. Choosing higher deductibles for an insurance policy will have lower premiums but higher costs to pay if there is a claim. Opting for higher deductibles only makes sense if drivers can save the money in case of an accident. The higher the deductible, the lower the monthly premium.
Opt for accident forgiveness programs offered by insurance companies. The feature helps prevent drivers from premium increases on their first at-fault accident. Most insurance companies have accident forgiveness as a built-in feature or as an added coverage option. The problem is if an at-fault accident occurs without accident forgiveness coverage, then a driver’s premiums can increase anywhere from 20% to 50% or more.
Shopping for new auto insurance rates is a good idea after an accident. Drivers who change their insurance policies can avoid higher costs. Rates after an accident can change with the same insurance company and often increase. Shopping for new rates may show what costs $3,000 with one company and only $2,200 with another.
Wrapping Things Up
Figuring out who is financially responsible for auto repairs after an accident is straightforward. Fault in the accident determines who pays and a drivers’ insurance coverage determines how much is paid and to whom. The at-fault driver’s liability insurance is typically the financial source for the other driver’s damages. If there is a dispute over who caused the accident, then the driver’s collision coverage is used.
To quickly recap, here is a quick reference list:
- Fault is determined as to who is responsible for the repair costs.
- Liability insurance is how damages to others are paid.
- Collision insurance is how the policyholder’s own damages are paid for.
- Modern vehicle costs to repair damage are considerably higher.
- Document the accident and collect evidence for the claims process.
Drivers will save time, money, and headaches with the correct insurance coverages in place. Checking the policy limits on an insurance policy at least once a year and changing when necessary will save major money down the road. The best time to think about insurance is before you need it.
