What happens when you file an automobile insurance claim
When you file an automobile insurance claim, you are telling your insurance company that you have had an accident, theft, or other damage covered by your policy, and you want them to pay for the repairs or losses. The company will assign an adjuster to your case — this person inspects the damage, reviews your policy, and decides how much the company will pay. You do not pay the adjuster; the insurance company does.
The process usually takes between two and six weeks from the time you report the damage to the time you receive payment, though this varies depending on the complexity of the claim and how quickly you provide the information the adjuster needs. If your car is still drivable, you can often continue using it while the claim is being processed. If it is not safe to drive, you may be able to rent a car through your insurance company, though this depends on your specific policy.
Key Takeaways
- Report the damage to your insurance company as soon as possible after an accident or loss, and provide them with the police report number if police responded to the scene.
- An insurance adjuster will inspect your vehicle and determine what your policy covers, which depends on whether you have collision coverage, comprehensive coverage, or liability-only coverage.
- You will need to provide documentation including your policy number, photos of the damage, repair estimates, and proof of ownership.
- If you disagree with the adjuster's decision about how much damage occurred or what the repairs should cost, you can request an independent inspection or hire your own appraiser.
- The amount you receive depends on your deductible — the money you pay out of pocket before insurance pays anything — and the actual cash value of your vehicle at the time of the damage.
The difference between collision, comprehensive, and liability coverage
Collision coverage pays for damage to your car when you hit another vehicle or object, or when another vehicle hits you. This is the coverage you use after most accidents. Collision coverage does not cover damage from weather, theft, or hitting an animal.
Comprehensive coverage pays for damage from events other than collisions — theft, weather like hail or flooding, vandalism, hitting an animal, or falling objects. If a tree branch falls on your car during a storm, comprehensive coverage pays for it. If your car is stolen, comprehensive coverage pays for it.
Liability coverage pays for damage you cause to someone else's vehicle or property, and for medical bills if you injure someone. Liability does not pay for damage to your own car. Many states require you to carry liability coverage by law, but collision and comprehensive are optional — though your lender will require them if you are financing or leasing the vehicle.
When you file a claim, the type of coverage you have determines whether the insurance company will pay anything at all. If you have liability-only coverage and you cause an accident, your insurance will not pay to fix your car — it will only pay to fix the other person's car.
What you need to gather before reporting a claim
Before you call your insurance company, collect the following information: your policy number (on your insurance card or bill), the date and time of the incident, the location, and a description of what happened. If another vehicle was involved, get the other driver's name, phone number, address, insurance company name, policy number, and license plate number. If there were witnesses, write down their names and phone numbers.
Take photos of all visible damage to your vehicle from multiple angles, and if the incident happened on a road, take photos of the scene itself — skid marks, traffic signals, road conditions, or the position of vehicles. If police responded, get the police report number; your insurance company will request this. Do not sign anything the other driver asks you to sign, and do not admit fault — straightforward exchange information and let the insurance company investigate.
If you have repair estimates from a mechanic or body shop, bring those too. Your insurance company may have preferred repair shops, but you have the right to use any shop you choose. Keep all receipts and documentation related to the damage or loss.
How the adjuster determines what your claim is worth
The insurance adjuster's job is to determine the actual cash value of the damage — what it would cost to repair your vehicle to the condition it was in before the damage occurred. The adjuster inspects the vehicle in person, takes photos, and may request repair estimates from body shops. They also review your policy to confirm that the type of damage is covered.
The adjuster will subtract your deductible from the total repair cost. If your deductible is $500 and repairs cost $3,000, the insurance company will pay $2,500. If repairs cost less than your deductible — say $300 — the insurance company pays nothing, and you pay for the repairs yourself. This is why choosing a higher deductible lowers your monthly insurance premium: you are agreeing to pay more out of pocket if something happens.
If your vehicle is totaled — meaning the cost to repair it exceeds a certain percentage of its value (usually 70 to 80 percent, depending on your state) — the insurance company will pay you the actual cash value of the vehicle minus your deductible, and you surrender the title to the car. The insurance company then sells the damaged vehicle for scrap or parts.
Disagreeing with the adjuster's assessment
If you believe the adjuster underestimated the damage or the cost of repairs, you have options. First, get a written estimate from an independent body shop or mechanic and send it to your insurance company. Many adjusters will reconsider if you provide a detailed estimate from a licensed repair facility.
If the insurance company still disagrees with you, you can request an independent appraisal. In an appraisal, you and the insurance company each hire an appraiser to inspect the vehicle. If the two appraisers disagree, they select a third appraiser, and the three of them reach a binding decision. You typically pay half the cost of the third appraiser's fee. Some insurance policies require appraisal before you can pursue other dispute options, so check your policy language.
If you still disagree after appraisal, you can file a complaint with your state's insurance commissioner or department of insurance. This is a free process, and the state can investigate whether the insurance company acted unfairly. You can also consult with an attorney, though this is usually only worthwhile for large claims.
What happens after the claim is approved
Once the insurance company approves your claim, they will send payment in one of several ways. They may send a check to you, send a check to you and the repair shop jointly (requiring both signatures), or pay the repair shop directly if you authorize them to do so. If your vehicle is financed or leased, the lender's name may appear on the check as well, and you will need their signature before you can cash it.
If you choose to use a repair shop that is not on your insurance company's preferred list, the company will still pay based on their estimate, but you may end up paying the difference if the actual repairs cost more. This is why it is worth getting multiple estimates before authorizing repairs.
Keep all documentation from the claim process — the adjuster's report, repair estimates, photos, and the final payment receipt. If you need to file another claim later, this documentation helps establish the condition of your vehicle before the new damage occurred.
Rental car coverage and other claim benefits
Many insurance policies include rental car reimbursement, which pays for a rental car while yours is being repaired. The daily limit varies by policy — it might be $30 per day or $50 per day — and there is usually a maximum total amount the company will pay, such as $900. If you rent a car that costs more than your daily limit, you pay the difference yourself.
Some policies also include roadside information, which covers towing to a repair shop, lockout services, fuel delivery, and jump starts. If your car breaks down or is damaged in a way that makes it unsafe to drive, you can call your insurance company's roadside information line, and they will arrange a tow truck. You typically do not pay anything out of pocket for this service.
Check your policy documents to see what additional benefits you have. Not all policies include these features, and the limits vary widely. If you do not have rental car coverage and need a rental while your car is being repaired, you will pay for it yourself, though you may be able to deduct this cost as a loss if you itemize deductions on your taxes.
Frequently Asked Questions
Do I have to use the repair shop my insurance company recommends?
No. You can use any licensed repair shop you choose. Your insurance company will pay based on their estimate of the repair cost, but if your chosen shop charges more, you may pay the difference. Many people use preferred shops because the insurance company has already negotiated rates with them, which can save money.
What if the other driver does not have insurance?
If you have uninsured motorist coverage, your own insurance will pay for damage the other driver caused. If you do not have this coverage, you would need to sue the other driver personally to recover costs. Uninsured motorist coverage is optional in most states but required in some, and it is usually inexpensive to add to your policy.
How long do I have to report a claim after an accident?
Most insurance policies require you to report a claim within a certain number of days — often 30 to 60 days, though this varies. Report the damage as soon as possible after it occurs. Waiting too long can give the insurance company a reason to deny the claim, and it makes it harder for the adjuster to investigate what happened.
Will filing a claim raise my insurance rates?
Filing a claim may increase your rates, but this depends on whether you were at fault, your driving history, and your insurance company's policies. If you were not at fault, many companies will not raise your rates. If you were at fault, rates often increase for three to five years. Ask your insurance agent what to expect before you file.
What if my car is worth less than the cost to repair it?
If the repair cost exceeds 70 to 80 percent of your car's value (the threshold varies by state), the insurance company will declare the car totaled. They will pay you the actual cash value of the car minus your deductible. You then own the damaged vehicle, and the insurance company may offer to buy the salvage rights from you for a small amount.