Property Damage Claims: Who Pays for the Damage to Your Car, Your Insurance or the Other Driver’s?

When you are involved in a car accident and the other driver is at fault, you have a choice whether to go through your own insurance company to have your vehicle repaired or the negligent driver’s insurance company. What’s the difference? If you make a claim with your own carrier, you will likely be charged a deductible. If you have rental car coverage on your policy, you will have access to a rental car while your car is in the shop, up to a daily or weekly limit set out in your policy. When the claim is settled, your insurer will “subrogate” (make a claim for reimbursement) against the responsible party’s insurance company to get the money back. This may or may not include your deductible. If it does, you will eventually be reimbursed. If it doesn’t, you’ll be out the $200 or $500 or however much your deductible is.
If, instead, you go through the other driver’s insurance directly, as long as liability is clear, they will pay for your car repairs and provide you with a rental car and you will not be charged a deductible. Either way, be prepared to have an adjuster question you about what happened in the accident. Note that although the adjuster will likely take photos of your damaged vehicle, you should take your own pictures, as well, in case there are any questions later on about the damage. Cell phones with a camera built in come in very handy for this because photos can be taken at the scene of the accident.What if liability is unclear?If you are partially at fault for the accident or it’s not clear who was at fault, it’s best to go through your own insurance company and then let the two insurance companies duke it out in subrogation. Your insurance company may get some of their money back that they paid out to repair your car, and you may get a percentage of your deductible back if the companies agree on how fault should be apportioned. Where it will make more of a difference to you is with regard to your injuries in the accident. If you were partially at fault, you will only collect a percentage of your damages, including money for your pain and suffering. If it is not clear who was responsible, it may have to be decided in court or by an arbitrator. If you were injured, and liability is not clear, even if the insurance companies decide on a percentage with regard to the property damage, you should hire an attorney who will advocate for your position and get you a larger percentage of your damages for your injury. (See more on injuries below.)What if your car was totaled?If your car was a total loss (it would cost more to repair than the value of the vehicle), and you are making a property damage claim for it with the other driver’s insurance, don’t be surprised if you wind up having to negotiate with them regarding the value of your vehicle. You could potentially get a better deal on the value with your own insurance company, but not necessarily. Claims where there is a total loss involved are notorious for taking longer to settle due to differences of opinion on the value of the car. What if you also have an injury?If you are injured, when you talk to the other insurance company about property damage, be careful what information you give them. The adjuster may try to get you to state that you have no personal injury claim or try to have you minimize your claim. Talk to a lawyer so you avoid saying or signing the wrong thing and hurt your chances of making an injury claim down the road. Fault vs. No-Fault stateNo-fault does not usually apply to property damage. Even in a no-fault state, you may either go through your own insurance or the other party’s insurance if the other party is at fault. Only Michigan requires a PPI policy—Property Protection Insurance—which pays for damage to your vehicle no matter who was at fault. It is similar to Collision, but you will pay no deductible.So, as you can see, the answer to whether you should make a claim for the damage to your car with your own insurance company or with the other driver’s is, it depends.

Lori Mandell