When you're involved in a car crash, you may be presented with a few different ways to get compensated for the damages and losses you sustained in the event. One of those ways is to file a claim against the collision coverage portion of your insurance policy rather than pursue an at-fault driver for the cash. Here are three things to think about when considering whether this is the right path to choose.
No Need to Prove Fault
Collision coverage is a no-fault insurance product, meaning it will pay out on claims from policyholders regardless of who caused the accident. This makes it a good option for cases when you were at least partially responsible for the crash or there is a dispute over whether the other driver(s) really was at fault. The insurance company will cut you a check for the assessed damages and assume responsibility for getting reimbursed from any liable parties involved in the incident.
Be aware, though, you cannot double dip. If you opt to get paid from your policy, you cannot demand payment from the other driver (or their insurance provider). The only time you can continue to pursue payment from the other party is if the amount you receive from your insurance company is less than the total damages you suffered, and even then, you can only demand the difference. For instance, if total damages were $10,000 but your collision coverage paid $7,000, you can only ask the liable driver to pay the remaining $3,000. Still, using your own insurance almost guarantees you'll get something, whereas waiting for the other driver to pay may end with a big, fat zero.
You're Confined by Policy Limitations
The other issue you need to consider is your policy limits, as in you will only be paid as much as your coverage allows minus your deductible. Thus, if the extent of the damage exceeds your policy limit, you'll still have to pursue the other driver for the unpaid portion. This isn't a big deal if the other party has adequate insurance, but you may run into issues if the liable driver was uninsured or their policy limits aren't enough to cover the balance. You may be forced to collect from the person directly, which can be tricky as most people don't have the money on assets on hand to pay for settlements out of pocket (which is why they buy insurance).
Additionally, your policy may limit your benefits in other ways that wouldn't apply if you were filing a claim with the liable party's insurance. For instance, the company may require you to get your vehicle fixed at a specific auto repair place or the amount of money you can collect for items inside the vehicle (computer, cell phone) that were damaged in the crash. It's essential you read your policy closely to determine how your insurance provider handles these things to help you decide if you're better off pursuing a third-party claim or sticking with your collision coverage.
However, You Can Protect Your Legal Rights
One advantage of filing a claim against your own insurance rather than dealing with a third-party claim is it may be easier to protect your legal rights. When you file a claim with your insurer, you do not have any duty to talk to the other driver's insurance company. This is good because the company will use any and everything you say against you, which can hurt any claims or cases you have against them if you say the wrong thing. When you deal exclusively with your own provider, you can keep your own counsel, something that can be beneficial if you choose to file a personal injury lawsuit against the liable party at a later date.
For more information about dealing with insurance companies after an auto accident or help with a collision case, contact an auto accident attorney.