Financial IQ

Don’t Let a Fender Bender Break the Bank

According to the National Highway Traffic Safety Administration (NHTSA) there were more than 5.6 million police-reported crashes in the U.S. in 2013. No doubt these crashes can take a huge emotional and financial toll on those impacted – and you might be surprised to learn what your policy covers, and doesn’t cover. The price tag for those crashes: $871 billion in economic loss and societal harm in 2010 also according to the NHSTA.

If you find yourself in an accident, it’s easy to feel frustrated, overwhelmed and scared. But there are a few things you can do to protect you and your money before and after an accident.

Prevention Before an Accident

Consider purchasing rental car coverage. This will pay for you to have a rental car for the time your car is in the shop being repaired. The coverage is inexpensive, but paying for a rental during a long repair can add up quickly.

Many car insurance policies offer coverage that you may not know about, so make sure your auto insurance policy is up-to-date and provides the right amount of coverage for you and your vehicle. Many minor details can make a huge difference when you need to file a claim after a collision.

Keep copies of your insurance policy and registration in your vehicle at all times.

Steps to Take After an Accident

Safety is paramount. Get you and all passengers to a safe spot and wait for help to arrive.

Get everything documented as quickly as possible and share information with the other driver including make, model and license plate. You’ll also want to get the other person’s contact and car insurance information so the claims process will go much more smoothly.

Take photos and gather witnesses. If you have a smartphone, it can be helpful to take photos of the damages, especially if you know you weren’t at fault and want to prove it. If you can find eyewitnesses and collect their contact information to give to the police and to your insurance company, that’s even better.

You may see a rate hike on your monthly insurance premiums if you are found to be at fault. Keep in mind if you have been accident free for a long time, many carriers will forgive your first at-fault accident.

If you are working with an independent agency like CoverHound, ask them to check all of their carrier partners for a better policy. Many carriers specialize in different risk profiles, so it’s possible another carrier they represent may have a better policy for you. Not all wrecks will result in a rate hike, but being proactive and working with your insurer is important after an accident. If you’re looking to get more from your provider, then you can switch insurers to take advantage of low rates.

This article was written and sponsored by CoverHound, where you can compare car insurance rates in as little as 3 minutes.