All it takes is for another driver to speed through a red light or swerve right into the side of your vehicle on the highway. Just like that, your schedule changes. You must wait for police officers to come and take a report.
You may have injuries that require medical attention and vehicle repairs to arrange. You probably expect to file a car insurance claim and forget about the whole situation. However, it is often a mistake to take for granted that insurance will quickly and fully compensate you for a crash.
What are some of the reasons you need to take care when handling a big claim after a collision?
Insurance companies want to preserve profits
The average insurance company is a for-profit entity that makes money in two ways. The main source of income for insurance companies is the collection of premiums for insurance policies.
Large numbers of people pay into the insurance program, and what the company doesn’t pay in claims contributes to its profit margin. The companies typically also make money by investing those excess funds. If they pay too much on claims, they will make less money.
You can expect that the insurance adjuster will do their best to minimize how much they pay. They might ask you to make a recorded statement and trick you into admitting fault or tempt you with a low settlement so that you can’t claim any future losses as the bills keep rolling in from the crash.
The coverage may not be nearly enough
If you drive a nice vehicle, you can have tens of thousands of dollars in uncovered property damage. California state law only requires $5,000 worth of property damage liability coverage. The other driver could have as little as $15,000 worth of medical liability coverage.
If someone wrecks your vehicle or leaves you in the hospital, their policy might not be enough to cover your bills, let alone lost wages. You could also have the bad fortune of getting into a crash caused by someone without an active insurance policy.
You obviously need to file an insurance claim, but you want to do so understanding that the company will likely try to minimize what they pay. You also will potentially need to look into other sources of compensation, like a personal injury lawsuit, if the coverage the other driver has won’t be enough to reimburse you. Recognizing the limitations of insurance after a motor vehicle collision will protect you from lasting financial losses.