Using Collision Coverage for Vehicle Damage

Should you make a claim under your own "collision" car insurance coverage to get your car back on the road after an accident?

Updated by , J.D. · University of San Francisco School of Law

Even when you're to blame for a car accident, you might be able to get your damaged car repaired or replaced if you carry collision coverage as part of your car insurance policy.

Collision coverage (also called "car damage coverage") allows you to make a claim with your own insurance company to pay for repairs to your vehicle, no matter who was at fault for the accident.

You Can Use Your Collision Coverage or the Other Driver's Liability Coverage (Not Both)

After a car accident, you can file a vehicle damage claim under your own collision coverage or file a third-party claim against the at-fault driver under their liability coverage (of they caused your crash), but you can't collect compensation from both sources for the same losses.

Once you settle a claim under your own collision ­coverage, you give up your right to collect that any compensation from the other driver's insurance for the same property damage.

If you collect from your own insurance company, you may have to sign or initial a "Right of Subrogation" provision, which allows your insurer to seek reimbursement for anything it has paid out to you, from sources including the other driver, that driver's insurance company, or anyone else who assumes financially responsibility for the accident.

How Does Collision Coverage Work After a Car Accident?

Let's say you're in a car accident with Joseph Blau, who's insured by the Incidental Insurance Company. You're injured in the accident, and your car sustains $10,000 worth of damage. You file a third-party claim against Incidental for injuries to you, and for damages to your car.

Incidental argues that the accident was at least half your fault, so it offers only $5,o00 for your car damage. You believe you can show that Joseph was completely at fault, but it'll take several weeks to get what you hope will be a helpful police report and a statement from a witness who will confirm what happened.

You have $20,000 worth of collision coverage with your own insurer, the New Age Insurance Company. If you don't want to wait to get paid by Incidental, or if you don't think you'll get the full $10,000 from Incidental, you can file a claim with New Age. Collision coverage pays regardless of fault, so New Age must pay you the full $10,000 minus any deductible.

If you collect from New Age, you give up your right to collect property damage from Incidental—except reimbursement for your deductible. After paying you, New Age will try to collect from Incidental, but its success or failure in doing so will not affect your right to keep the money you've collected from New Age.

Will I Get My Deductible Back If I Make a Collision Coverage Claim?

Maybe. If you make a collision coverage claim with your own insurance company and it turns out the other driver was at fault for the accident, your own insurance company might:

  • pay out on your claim, and
  • turn around and seek reimbursement from the at-fault driver's insurance company.

They might also be able to recover any deductible you paid as part of the collision coverage claim process, but it's not a guarantee.

Personal Injury Claims Are Different From Collision Coverage Claims

Nothing you do under your own collision coverage affects your right to pursue a personal injury claim against the other driver's insurance company. You are free to go after the other driver's insurance company for any injuries and lost income resulting from the crash.

Advantages of Using Your Collision Coverage After a Car Accident

There are two main advantages to using your own collision coverage rather than filing a third-party claim.

Your Own Insurer Will Likely Pay Your Vehicle Damage Claim Quicker

First, you'll probably get a check from your own insurance company more quickly. Collision coverage pays regardless of fault. With third-party claims, the insurance company will investigate the car accident to determine whether their own insured was to blame. Investigations take time. You may have to wait for a police accident report or for an insurance adjuster to contact a witness before you can show the other driver's fault. Or the other insurance company may simply stall to see whether you'll give in on the question of fault.

A Collision Coverage Claim Won't Impact Your Injury Claim

If you also have a third-party personal injury claim, you may not want to talk to the other driver's ­car insurance company until you've fully investigated the matter. Until you're certain about the facts and your arguments, it's dangerous to ­discuss details of the accident with anyone on the "other side." The struggle over who was at fault doesn't come up under your own collision coverage, and so these delays in paying out don't happen as often. Your own insurance company must reimburse you immediately after you've followed its rules regarding inspection and estimates, and you've agreed on a repair option.

Disadvantages of Using Your Collision Coverage After a Car Accident

Now let's look at the potential downside to filing a claim under your own "collision" car insurance coverage after a car accident.

Your Options Depend on Your Collision Coverage Limits

If you make a claim for vehicle damage under your own collision coverage, you're limited to the amount of cov­erage listed in the policy. If the collision coverage policy limit is less than the cost of repairing your vehicle, you'll have to come up with the difference out of your own pocket, unless you settle a claim against the other driver's insurance.

You may also be limited in what you can collect for items that were inside your car—like clothing, luggage, or sound equipment that's not permanently installed—and temporary replacement property, such as a rental car if your car can no longer be driven. Get the basics on property damage claims.

You'll Have to Pay a Deductible When You Make a Collision Coverage Claim

The compensation you collect ­under your collision coverage will be reduced by your collision coverage deductible. If the deductible is large and you need the amount to pay for repairs, this can present an added problem in getting your car repaired. For example, most people carry a deductible amount of $500 to $2,000 on their collision coverage. If repairs to your car cost $5,000 and you have a $1,000 deductible, your insurance coverage will pay you $4,000, and you must come up with the other $1,000 out of your own pocket.

But, as we discussed above, there may be situations where your insurance company recovers your deductible for you, if the other driver ends up being at fault for the crash.

The Collision Coverage Claim Process Might Be a Pain

The rules set by your insurance policy for processing a claim under your collision coverage may be more ­restrictive than the process for a third-party claim.

For example, your collision coverage may require more bothersome inspections of the car and estimates of the work before you can get approval for repairs. By contrast, the other driver's insurance company has no right to enforce any such specific rules during the course of your claim. That's ­because your right to compensation from another driver's insurance arises from the other driver's fault, and not from a contract between you and the insurance company.

Will My Insurance Rates Go Up If I File a Claim Under My Collision Coverage?

Most drivers are well aware of the often exorbitant cost of auto insurance. While insurance companies often do raise rates after an accident, these increases aren't generally based on the fact that you've filed a claim.

Insurance companies base rates on several factors, including location and type of car, and the age of the primary driver. But it's your driving record that's most likely to affect your rates. If you're involved in an injury accident, your company will look at your overall driving record—including all moving violations and accidents—to determine whether to raise your rates (or, if your record becomes bad enough, to cancel your insurance altogether). It's the fact that you've been involved in an accident, rather than the type of property damage claim you file, that may affect your rates.

Next What's Next After a Car Accident?

If you came away from you car accident with only vehicle damage (no injuries), it probably make sense to handle your own insurance claim, especially if it's through your own collision coverage (so you'd be working with your own insurance company). For more information on insurance coverage after a car accident, and every tip you'll need to navigate your car accident case, get How to Win Your Personal Injury Claim by Joseph L. Matthews (Nolo).

Of course, if your car accident also resulted in injuries, or if you're running into any kind of conflict with the insurance company, it might be a good idea to discuss your situation with a lawyer. Learn more about how a car accident attorney can help.

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