The need to repair even a brand-new car may arise at any moment. Let us take, for example, such a typical domestic situation: you unsuccessfully drove into the garage and scratched the car’s side pretty hard. What is better for you: to pay for repairs yourself or try to make an insurance claim?
When there is a need for not too expansive repairs, it is important not to hurry and to consider the situation calmly. Of course, the insurance claim saves you from having to spend money on repairs. But every medal has its reverse. In the future, there may be a situation when your insurance rates will greatly increase, and instead of gain, you will get a loss.
Experts give the following advice: if the cost of repairs does not exceed $2,000, then it is better not to make an insurance claim, since in the future this may result in larger cash expenses. But if the cost of repair exceeds $2,000, then making the insurance claim may be really cost-effective.
Thus, the main aspect is holding of a correct preliminary assessment of the upcoming repair.
But, unfortunately, is extremely difficult to formulate some universal rule that allows you to determine the feasibility paying for the repair. There are too many individual features of car insurance. After all, every car owner acquires different feature packs. For example, you will have to pay the deductible in any case, and this amount is usually about $1,000. At the same time, such types of insurance as collision insurance, comprehensive insurance (vandalism, damage caused by undesired objects, etc.) are not mandatory ones. You can pay them if you have such a desire. Thus, when as a result of some kind of blow, a car requires repair, the cost of which does not exceed $1,000 and the deductible also has a cost of $1,000, and if you make an insurance claim, then you will not get any cost savings.
Special attention should be given to cases where repair is required due to an accident that occurred through your fault. It could be anything. If the insurance company decides that you are responsible for the accident, then it will definitely take this opportunity to raise your rates. Very often, insurance companies raise your rates, even if you do not demand any compensation - they just need to get information that the accident occurred through your fault. Therefore, when you talk with representatives of the insurance company, you need to be extremely careful and not to give them unnecessary information that is not relevant. Otherwise, even a randomly dropped word can bring your rating down to zero. It should be noted that there is an exception. Many insurance companies oblige drivers to compulsory report about all collisions, even if the driver pays for the repair. If there is such a requirement, then withholding information from the insurance company does not make any sense.
Perhaps the only exception to this rule is Ontario. There is a law prohibiting the insurance companies from raising your rates if the damage from the collision had been minor (less than $2,000) and no one was injured during the accident, and the driver pays for the repair.
But if you cannot pay for repairs yourself and you cannot postpone it for later, then you will have no choice but to make a claim. In this case, there is nothing to be done, and there is just no point in arguing about which is more profitable. It is necessary to find an urgent solution to the problem in the ways that are available. In all other situations, you should bear in mind that any claim for insurance may worsen your rating and increase expenses in the future. Each accident also automatically degrades the rating.
Each insurance company uses its own rating system. But not one of them works to their own detriment. If drivers have not had a single accident for six years, then their rates are reduced and they pay less for insurance. Typically, such drivers are rated six stars. But the first accident reduces the rating to five stars, and increases rates by about 20 percent. And the second accident brings down the rating to zero, and the rates can increase by two, or even three times. In this scenario, the price of car insurance can reach $6,000 per year.
If you are not sure about your driving, then you can get the so-called "accident forgiveness". In this case, the insurance company does not count your first accident, as if it did not exist at all.
Residents of provinces with public insurance (Manitoba, Saskatchewan, British Columbia) have some car insurance benefits. In these provinces, if the drivers pay for the repair themselves, then the accidents do not affect their rates