Car Insurance Claims Process Explained
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Written byMandy Sleight
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Mandy Sleight has over 15 years of insurance knowledge and expertise in auto, home, life, health, pet, supplemental benefits, and other insurance products. She’s a sought-after insurance expert, appearing in Bankrate.com, Moneygeek.com, U.S. News & World Report, Reviews.com, CNET, and other publications, and she's been writing for Compare.com since 2023.
Mandy uses her background and experience working for well-known insurance companies like State Farm and Nationwide Insurance to create engaging and easy-to-understand content that helps readers make smarter insurance choices that have a positive effect on their budgets and finances.
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Edited byLequita Westbrooks
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Lequita WestbrooksSenior Editor
Lequita Westbrooks is an insurance editor at Compare.com. Her writing and editing experiences span several industries, including insurance, personal finance, higher education, and more. She excels at explaining complex topics like auto insurance in simple, easy-to-understand language and is passionate about helping readers save money. Lequita graduated from the University of South Florida, where she earned her Bachelor’s degree in English.
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Reviewed byAmanda Clear
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Amanda Clear is a licensed Property and Casualty insurance agent who runs her family insurance agency providing coverage in the states of Connecticut, New York, and Vermont. She specializes in providing customized insurance packages to her clients that provide the best coverage for the price that they can afford. She holds a bachelor's degree in English from Sacred Heart University in Fairfield, CT, and works as a freelance editor, proofreader, and writer outside of her insurance career.
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If you want insurance to cover repairs or injuries after an accident, you’ll need to file a claim with either your car insurance company or the other driver’s. The type of claim and which insurer you file with depends on what happened, who’s at fault, and your insurance coverage.
This guide will help you understand the claims process, including the top five things to know, when to file, what happens after filing an auto insurance claim, and how to keep your auto premiums affordable after an accident.
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5 Things to Know About the Car Insurance Claims Process
Understanding the car insurance claims process before filing can make the process easier. Here are five things to know.
1. When you should tell your insurance company about the accident
Each state and insurance company has different rules for reporting an accident. You should report a car accident as soon as possible if there are injuries or vehicle damage, according to the Insurance Information Institute (Triple-I). This can speed up the claims process and help you quickly determine if you have enough coverage.
But if you’re in a minor fender bender that doesn’t cause any injuries — especially if the damage is less than your coverage deductible — you probably don’t need to report it. Your insurance company will only pay for repairs that cost more than your deductible.
If you need to file a claim, take these steps:
Gather information and accident details.
Notify your insurer.
Work with the claims adjuster.
Receive your payment or claims settlement.
2. Filing a claim doesn’t mean you’re at fault
If you’re worried that filing a claim means you’re admitting fault — don’t be. Your state laws and the details of the accident determine who’s at fault. Besides, delaying the claims process will only make getting medical attention or vehicle repairs more challenging.
Once you file, the insurance adjuster will investigate the accident and determine who’s at fault. The at-fault driver’s insurance policy will pay for the other driver’s damages and injuries. In cases where both drivers share fault, the negligence laws in your state determine how insurers pay damages.
3. You’ll likely pay a deductible
A deductible is the amount you pay toward repairs or replacing your car after an accident. If you file a comprehensive, collision, or uninsured motorist claim, you’ll likely pay a deductible.
For example, if you hit another vehicle and have a $500 collision deductible, your insurer will pay $4,500 of the $5,000 repair bill while you pay your $500 deductible. You’ll usually pay the deductible to the repair facility after finishing your car repairs.
You may not have to pay your deductible if you have a collision deductible waiver on your policy and get into an accident with someone who doesn’t have insurance. Some insurers may waive your comprehensive deductible for minor damage — like cracks in your windshield, for example.
And if your insurance company repairs your car but you weren’t at fault, it might be able to recover your deductible from the at-fault driver’s insurer.
4. You might be covered for a hit-and-run accident
A hit-and-run occurs when someone hits your vehicle and leaves the scene of the accident without providing their information. Your insurance policy may cover your vehicle’s damage and your injuries if you have any of the following coverages:
Medical payments coverage (MedPay)
Personal injury protection (PIP)
Collision coverage
Uninsured motorist coverage
5. The claims process might take longer than expected
Although the claims process takes an average of 30 days, some claims might take longer. Each claim is unique, and some are more complex than others, such as multi-vehicle accidents or claims with severe and long-term injuries.
Common reasons for a delay in the claims process can include:
Inadequate coverage
Insufficient information or documentation (e.g., police report)
Delayed repair parts
Late or nonexistent communication with your claims adjuster
What to Do After You File a Car Insurance Claim
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A few things occur after you submit a car insurance claim. Once the insurer assigns a claims adjuster to your case, here are the steps you’ll take.
Get the damage appraised
The insurance adjuster will ask you to get a damage estimate from a certified repair shop. You can use a repair shop you know or choose from the insurer’s network of body shops. You’ll usually get a lifetime warranty on repairs for as long as you own the vehicle if you go with a shop your insurer recommends.
Although one estimate may be sufficient, your adjuster might ask for a second opinion, especially if they believe the original is too high. The insurer can’t force you to use a specific shop but can make an offer based on a lower estimate, according to Triple-I. If this happens, you can negotiate (which we’ll discuss later in the article).
Ask your insurer about a rental car
If you have rental car reimbursement coverage on your auto insurance policy, your insurer will pay for a rental or reimburse you if you pay out of pocket. Rental reimbursement coverage is optional but will help cover rental expenses while your vehicle is in the shop for repairs.
The amount of coverage and the time frame depend on your policy coverage and insurance company. If you don’t have rental coverage, the insurance adjuster might help you get a rental, but you’d be responsible for the costs. The other driver’s insurance will cover your rental expenses if you weren’t at fault in the accident.
Negotiate your settlement offer
You don’t have to take the insurance company’s first settlement offer, especially if the damage lowers your car’s value and you’re eligible for diminished value reimbursement (the difference between your car’s value before and after an accident).
If you feel the settlement amount is too low to fix your vehicle, you can negotiate — but prepare your counteroffer with evidence, such as a detailed mechanic or body shop estimate.
In some situations, it may be necessary to appeal by:
Hiring a public adjuster for an independent appraisal
Filing a complaint with your state’s insurance department
Hiring an attorney
Keep in mind that if you don’t have coverage for original equipment manufacturer (OEM) parts on your policy, your insurer might only pay for after-market parts. They cost less than OEM parts and are just as safe, according to Triple-I. The insurer may not renegotiate if this is the reason you’re countering the offer.
For personal injury claims, it’s a good idea to wait until your doctor releases you from treatment and you’ve healed before settling to ensure you get fair compensation.
Get your car repaired or replaced
The last step is to get your car repaired if it’s fixable. The time it takes depends on the required repair parts and the extent of the vehicle damage. The shop will notify you when it’s time to pick up your car and pay your deductible.
If the insurance company declares your vehicle totaled, it will pay your car’s actual cash value (ACV) minus your deductible, if applicable. The amount may be higher if you have gap insurance or new car replacement coverage.
When to File a Car Insurance Claim
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Knowing when to file an auto insurance claim based on coverage type can help prepare you for the claims process and what to expect.
The table below shows what each coverage type pays for and when to file a claim for each type.
Coverage Type | What’s Covered | When to File a Claim |
|---|---|---|
| Liability insurance | The other party’s injuries and property damage when you’re at fault | File with the other driver’s insurance company when they’re at fault |
| Comprehensive insurance | Non-collision claims, such as fire, animal damage, and weather events | When the damage exceeds your comprehensive coverage deductible |
| Collision insurance | Collisions with another vehicle or object and single-vehicle auto accidents | When the damage exceeds your deductible or is too much to pay out of pocket |
| Uninsured/underinsured motorist insurance | Accidents with a driver who doesn’t have insurance or enough coverage to pay for your injuries and property damage | When you’re a victim of a hit-and-run, someone leaves the accident scene, or the damage exceeds the other driver’s policy limits |
| Personal injury protection | Medical expenses, lost wages, in-home services, and financial compensation for pain and suffering | When you’re injured as a driver, passenger, pedestrian, or on a bike or motorcycle, regardless of fault |
| MedPay insurance | Medical bills for costs related to injuries in a covered auto accident | When you’re injured as a driver, passenger, pedestrian, or on a bike or motorcycle, regardless of fault |
How to Reduce Car Insurance Costs After an Accident
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Your car insurance rates typically increase by around 44% after an accident, according to Compare.com data. Luckily, there are ways to save money and reduce the likelihood of a potential rate increase:
Sign up for a usage-based insurance program: Many of the best car insurance companies offer telematics programs, which track your driving habits and reward you for safe driving behaviors, like not using your phone, speeding, or braking too hard.
Ask about discounts: Your insurer may offer discounts you’re not taking advantage of. Talk with your insurance agent to ensure you’re getting what you’re eligible for.
Update your coverage: If a rate increase makes your current policy unaffordable, you might be able to reduce coverage or eliminate it. For example, you might not need comprehensive or collision coverage if you drive an older car.
Shop around to compare rates: Comparing car insurance quotes for the same coverage can help determine if you’re getting the best deal on the coverage types you need.
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Car Insurance Claim FAQs
We answered the most common questions about car insurance claims to make the process easier.
How long does it take to settle a car insurance claim?
Settling a car insurance claim can take anywhere from a few days to a few months. It depends on how fast you file the claim, the severity of the accident, if lawyers are involved, and the laws in your state. Most states require insurers to investigate the claim within 30 days of filing.
Can you get a repair estimate before filing an auto claim?
Yes. Getting a repair estimate before filing an auto claim may be a good idea if you think the damage may be less than your deductible. It can also help you determine if it’s worth filing or paying out of pocket for minor incidents.
Will filing an auto claim increase your insurance rates?
It’s possible. Any claim you file can increase your insurance rates — and rates go up an average of 44% after an accident, according to Compare.com data. Insurers use your past claims history, fault status of the current claim, and other factors to determine when and how much to increase premiums.
How do car insurance companies pay out claims?
Car insurance companies pay the mechanic or repair shop directly or will issue you a check or initiate a bank transfer to pay out claims. The average claim time frame from start to finish is around 30 days. More complex claims take longer, while more straightforward claims will pay out faster.
Can a car insurance company deny your auto claim?
Yes. An insurer might deny your auto insurance claim if you don’t have the right coverage, the claim total exceeds your coverage limits, or the policy is inactive at the time of the accident. If you feel your insurer unfairly denied you, you can appeal the denial.
Sources
Insurance Information Institute, “Determining your car's value and cost of repair,” Accessed March 15, 2024.
Insurance Information Institute, “FAQs about direct repair programs and generic auto parts,” Accessed March 15, 2024.
Insurance Information Institute, “How to file an auto insurance claim,” Accessed March 15, 2024.
Insurance Information Institute, “What should I do if I am having trouble settling my claim?,” Accessed March 15, 2024.
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Mandy SleightInsurance Writer
Mandy Sleight has over 15 years of insurance knowledge and expertise in auto, home, life, health, pet, supplemental benefits, and other insurance products. She’s a sought-after insurance expert, appearing in Bankrate.com, Moneygeek.com, U.S. News & World Report, Reviews.com, CNET, and other publications, and she's been writing for Compare.com since 2023.
Mandy uses her background and experience working for well-known insurance companies like State Farm and Nationwide Insurance to create engaging and easy-to-understand content that helps readers make smarter insurance choices that have a positive effect on their budgets and finances.
Lequita WestbrooksSenior Editor
Lequita Westbrooks is an insurance editor at Compare.com. Her writing and editing experiences span several industries, including insurance, personal finance, higher education, and more. She excels at explaining complex topics like auto insurance in simple, easy-to-understand language and is passionate about helping readers save money. Lequita graduated from the University of South Florida, where she earned her Bachelor’s degree in English.
Amanda Clear is a licensed Property and Casualty insurance agent who runs her family insurance agency providing coverage in the states of Connecticut, New York, and Vermont. She specializes in providing customized insurance packages to her clients that provide the best coverage for the price that they can afford. She holds a bachelor's degree in English from Sacred Heart University in Fairfield, CT, and works as a freelance editor, proofreader, and writer outside of her insurance career.
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