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Accident Reporting: When Your Insurance Company Needs to Know

February 9, 2012

After a minor fender bender, you might think it makes sense to simply pay for the damages out of pocket and avoid the rate increase on your car insurance that will result from reporting a claim. While this might work out perfectly in some cases, it’s important to know that there are potential repercussions to this decision that could come back to trouble you in the future. When should you report an accident to the insurance company? Consider all of the risks before you make a decision.

Your Responsibility for Reporting an Accident

Any accident where the damage to the vehicles is significant must be reported to the police – in Ontario, the total damage amount from both cars is $1000 and in Alberta, the total damage amount is $2000. Check with the police for the specifics for your province – any accident where there is damage to property and any accident where someone is injured will require a police report. And if a police report is completed for the car accident, you must also notify your insurance company.

The police will not report the accident to your insurance company, but in some cases it might be taken out of your hands by the other party. Should the other driver involved choose to report to their auto insurance company, yours will be notified.

What Happens if you do not Report an Accident

If the other driver never contacts their insurance company and neither do you, then you will not see a rate increase as a result of the accident. But simply because a few months have gone by does not mean you are in the clear. While each province may have different laws, in most cases the other driver has up to two years to file a claim against you. That means that should they decide down the line that they want to make a claim for an injury that wasn’t noticed when the accident first happened, they have that right.

It is expected by many insurance companies that you report any accidents to them within seven days of the occurrence. Some may give a longer time period, but they all have a limit. In some cases failure to do this could mean the insurance company will deny the claim. Should you or the other person decide to file a claim down the line, you might find out the insurance company is not going to pay.

Furthermore, if the insurance company finds out about an accident later, even if you paid for the damage out of your own pocket, they can still raise your car insurance rates as a result. Whether or not you filed a claim, an at-fault accident raises the risk of insuring you and can thus be a reason for a rate increase; remember that rate increases do not occur just because you filed a claim, but based on the fact that you were responsible for an accident as well. Even worse, failure to report an accident may be grounds for the insurance company to non-renew you.

Things to Know When Shopping for Car Insurance

When you are shopping for car insurance, it is important to find out what the company’s policies are on reporting accidents and how they will proceed should they find out about an accident after the fact. Remember that insurance companies can determine their own rules for these procedures and also determine how they will rate for someone with an accident.

If you have already had an accident which you did not report but was later reported to the insurance company, you will need to disclose this accident when you shop for a new policy. The good news is that while the current insurance company may have decided to non-renew you as a result of your failure to report the accident, that does not mean that another insurance company won’t take your business and even offer you a good rate for your coverage.

Accident Reporting: The Bottom Line

When you make the decision as to whether or not to report an accident, you need to weigh all of the risks against the benefits. The main benefit of not reporting an accident is that your rates will not go up – but it is clear that there is no guarantee of this. Thus the benefit of not reporting is a risky one at best, and not reporting may wind up costing you more in the long run.

In any case where there is a lot of damage or there are injuries, you should call the police and inform the auto insurance company right away. Injury claims especially have a way of escalating very quickly, even when they appeared minor at the scene. You pay for insurance to protect you from the financial burden of an accident – but failure to follow their reporting guidelines may mean that protection won’t be there for you. In the end, not reporting an accident is most often a risk not worth taking.

  • rafik

    Believe it or not , when i was i Toronto,my renewal premium went up > 100$ , when i had an accident.Not at fault. I was not even driving,when a guy couldn’t control his car on ice[skid].
    He bombarded my left side of the parked car.Engine was off.
    Any justification? is it legal?Thank you.

  • Nick – InsuranceHotline.com

    Dear rafik:

    Because the increase in your renewal premium was $100, I am guessing that it was as a result of a general rate increase, not your accident. If you were being charged for the accident, your increase would likely have been a lot more than $100.

  • nick

    if i had an accident that is my fault and did a police report but did not claim my repair but the other party did. is this accident in my record and should i state this when i try to get a new quote..and i also had a accident forgiveness from my current auto insurance.

  • Nick – InsuranceHotline.com

    Hello,

    If you have an accident and it is reported to your insurance company, then the accident will stay on your record for six years. One thing to keep in mind when shopping around for car insurance: accident forgiveness for an accident will not be taken into account with another insurance company. Thus the new insurance company can and likely will charge for the accident on the new policy. It is still beneficial to obtain car insurance quotes, as your new rate may be less than what you’re currently paying.

    Hope this helps!

  • Ken

    Hello I hit a parked car in a private parking lot and made a small dent and small paint chips. The guy says its about $1300 to fix! I thought it was going to be like $300-$500. Will my premium increase? He is making a claim I am not.

  • Nick – InsuranceHotline.com

    Hello Ken,

    If the other driver is making an insurance claim, then your insurance company will be notified and you may experience a rate increase at renewal. Please check with your insurance company for more info.

  • Michelle Patlan

    I was involved in an accident where i was at a traffic metering light and was stopped. the light turned green and i was about to go when i was rear ended. i did not have alot of damage and we exchanged information. i have come to find out that all of his info was false. he has my info (that is correct). what should i do now? the only thing i have is the color, make of the car and his license plate number. how do i handle this?

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello Michelle,

    Typically, the vehicle who hits from behind is at fault. You can report this to the police as well as your insurance professional (broker/agent).

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello Michelle,

    Typically, the vehicle who hits from behind is at fault. You can report this to the police as well as your insurance professional (broker/agent).

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    Yes they will be able to make a claim. If the neighbour has your licence plate number and it’s given to the police, they may contact you to find out what happened.

    Thank you

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    If the woman was sliding and hit your vehicle, it sounds like she would be at fault.

    thank you

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    If you did damage to property in the accident, you may be charged with failing to report an accident.

    Thanks you

  • Tkidd

    Hi there, I had a minor fender bender 4 days ago in Halifax, Nova Scotia where I bumped another vehicle from behind causing no damage to very minimal damage. The person involved is claiming that there is damage, can I prove that this is not the case? Also, should I report this to my insurance company? Or just wait to see how they want to proceed?

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    If you rear ended the driver in front of your, you would be 100% at fault. It is likely that the other driver is going to report it to their insurance company and yours will find out anyway.

    Thank you

  • john

    hi i wanted to ask in ontario if u get in an accident and you and the other drive decide not to report to insurance company but the police is on the scene and made a report but the damages were under 1000 very minor ones will the police contact the insurance company

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    The police will typically not contact the insurance company.

    Thank you

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    That all depends upon where you live. Check with your insurance agent or broker to find out what your options are.
    Thank you

  • Mike Jones

    Hello, I was involved in an accident a year and a half ago. I am now being sued without any notice. I initially did not report it to the insurance company but I’m wondering now if I should try to contact them. It’s been a pretty long time so the likelihood that they would pay is slim-to-none but would you know where to look for such information? I’m a NY resident and the accident happened in NJ, my insurance company at the time was Geico.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    I am sorry but I don’t know how long you have to make a claim in NY. You are best to check with a Geico representative and see if you can still make a claim.

    Thank you

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    The city might make a claim to your insurance company once they receive the police report.

    Thank you

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    In some provinces you are but in others you may not be. You are best to check with your insurance professional.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    hello

    They other driver is likely at fault since he was making the left turn.
    If you live at home then it is likely that your mother’s insurance company is going to want to add you to her policy.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    Your insurance company may find out about your accident anyway since collisions are tracked by drivers licence number. You are best to disclose the accident.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    hello

    Your insurance company may find out anyway if they search your driving history.

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