Steps to Getting Paid On An Auto Insurance Claim

by Gary Foreman

Steps to Getting Paid On An Auto Insurance Claim photo

If you get in a car accident, don’t let the insurance companies take you for a ride. Take these steps to get paid on your auto insurance claim.

It’s a terrible feeling. You’ve just had an auto accident. Fortunately, no one’s hurt, but now you have to face all the hassle of police and insurance reports, repair shop estimates and getting your car fixed.

But if you don’t do a good job of completing these steps, it can cost you big money!

Here are a few simple ways to keep from being taken on your auto insurance settlement.

At the accident site you want to accomplish a number of things

First, you want to make sure that no one is injured and, if there is a possibility of injury, that proper medical attention is provided.

Next, you’ll want to collect information. Especially about the driver of the other car. Name, address, phone number (home and work), license number, date of birth. Take notes on the other car. Make, model, year, license number, condition. Find out if the driver was the owner of the car. If not, find out who does own the car and how they can be contacted.

What you do and say at the accident scene can have a major impact on how your auto insurance claim goes. A little effort here can pay big dividends later.

Make notes of anything that might be relevant later. Who was wearing seatbelts? Any road hazards? Was there a blinding sun? Road slick from rain? Heavy traffic or other distractions? Write down a description of how the accident occurred. Talk to witnesses. Get their name, phone number and their description of the accident.

Remember, you won’t be able to take notes if you don’t have paper and pen (or better pencil) in your car or the ability to take notes on your phone. If you happen to have a camera available when a fender bender occurs (most of us do these days), take pictures.

Don’t count on the police to collect all the necessary information

Their job is to keep the peace, not to help you collect on an insurance claim.

When talking with others don’t argue. You’re trying to collect information, not win a debate. Even if the other driver says he was at fault, it won’t necessarily help you get a fair settlement from the insurer.

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After leaving the accident scene

Your first duty after leaving the accident scene is to report the accident to your insurance company. Your policy may require you to report the accident within a certain number of days if you want a claim to be honored.

Most claims are fairly routine and the biggest question is how much will repairing or replacing your car cost. It’s possible that you will be asked to tell your story under oath. This is a warning sign. The insurer thinks you’re lying or may have done something illegal. You’d be wise to call your attorney.

Don’t, however, withhold information from your insurance company. You do have a duty to cooperate. If you’re asked to tell or write your story, do so. Tell them what you know about the other driver, witnesses or other details.

Start a claims contact diary

Once you’ve reported the accident, you’ll need to start a claims contact diary. Chances are that this won’t be settled with just one or two phone calls. You’ll want a record that lists who you talked to, when you spoke and what the main points of the conversation were. Nothing fancy, but later you’ll want to have that information available.

Get the file number for your claim from the insurance company. You’ll need that number. You’ll be wasting your time if all your phone calls and letters don’t reference your claim number.

You may find that the adjuster doesn’t respond as fast as you’d like. After all, he’s overworked and it’s not his car with the crumpled fender in the driveway. Begin by writing a letter. A letter will make your claim a higher priority than someone who just calls. If that doesn’t get things rolling, call in and get his supervisor’s name. You might not even have to call the supervisor. It’s likely your adjuster will learn of your call and try to get to you before you get to his supervisor.

You’ll need to understand the cause of the damage. The process is the same, but the amount paid can be different. Your deductible may be different for collision (a moving accident) than comprehensive (i.e. a tree falls on your car). Usually you’re better off it the damage is covered under the comprehensive part of your policy.

Get an estimate on the damage

In most cases, you’ll need to get an estimate of what it will cost to repair the damage to your car. Remember that your goal is to get your car repaired properly so you won’t have problems later.

The insurance company’s goal is to pay you as little as possible. They may suggest that you to use their ‘convenient drive-in claims adjuster’. Or perhaps they’ll use a quote from a local repair shop that gets lots of business from them.

Don’t go for it. In either case, the person providing the estimate is loyal to the insurance company. They have no reason to try to satisfy you. Find a shop that has your confidence. The dealer that sells that make of car is probably the best if they have a repair shop.

You may want to get estimates from a couple of different shops. That’s your choice. Check your policy. It rarely requires you to go to their shop or to get more than one estimate.

What happens if your car isn’t driveable? Then have it towed to the shop of your choice. It’s cheapest to do that right at the time of the accident. It’s good to have the shop’s name and address already available in your car. By having the car to the shop of your choice you’ve forced the adjuster to play on your home field. He has to respond to their estimate. On the other hand, if the car’s in your driveway he can offer to have it towed to his favorite low cost shop. Then he’ll have all the advantage in negotiating the price of the repairs.

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Before you sign a check from the insurance company

OK, you’ve agreed on a shop and the work is completed. So it’s just a matter of picking up the car. Right? Wrong!

This is your last real chance to get the job done to your satisfaction. The insurance company will have named you on the check. You will be required to sign the check or a repair order stating that the work is completed. You may also need to write your own check to the repair shop for the deductible.

Don’t sign off until you’ve thoroughly inspected the car. And I do mean thoroughly.

Look at the bodywork under bright lights. Sunlight is best. Look at the car from all different angles. Is the sheet metal straight? How’s the paint? Try all the doors, windows and anything else that moves in the repaired area. Make sure that nothing is binding or crooked and that everything is properly aligned. Take it for a test drive. It should run and sound like before the accident. No new rattles.

Make sure you understand your guarantee. If something goes wrong later you’ll be dealing with the repair shop, not the insurance company.

If you’ve been forced to use a shop chosen by the insurance company, be especially careful to inspect the car. In fact, you probably would be wise to ‘drop in’ once or twice during the repair to actually see what’s happening. Ask to see all the old parts that they were going to replace. They could save some money by repairing a molding or other part instead of buying a replacement part. All shops are not dishonest, but some are.

What if your car is determined to be a total loss?

Suppose that your agent calls and says that you car is a total loss. They want to cut you a check for the value of the car and you just give them the car and title.

There are two potential problems. First, your car was worth more to you than anyone else. That’s why you were still driving it. Second, how do you determine what the car’s worth?

The adjuster will probably use the Kelly Blue Book value. They might also include classified ads for similar cars to come up with an offer for your car.

Expect them to offer you the ‘wholesale’ value. That’s what the dealer would pay for the car before they add their profit margin to sell it to you. Naturally, you’ll end up paying retail. Shouldn’t your payoff be at retail?

How can you get a higher price?

By shopping! Go to a number of dealers. Read the classified ads for comparable cars. Make a list and give it to the adjuster. If that fails, ask him to find a replacement car for the amount he’s offering. He’s the one that says it’s out there. Let him prove it.

Now’s the time that homework pays off. Was your car a low mileage vehicle? That’s worth something. Did you keep maintenance records to show that the car was in above average condition? Do you have any pictures or other evidence that your car was a ‘cream puff’?

Oh, and don’t forget to add in the cost of tax and title. In some places it can be 6 or 8% of the price of the car. In almost all cases that will be hundreds of dollars.

Hopefully, you won’t ever need to settle an auto accident claim. But, if you’re ever in an accident, knowing how to deal with the insurance company is essential.

They expect you to pay your premiums faithfully. It’s up to you to make sure that they pay properly on your claim. Nothing that the average driver armed with a little knowledge can’t do. And if it ever comes up, so can you!

Reviewed July 2021

About the Author

Gary Foreman is a former financial planner and purchasing manager who founded The Dollar website and newsletters in 1996. He's the author of How to Conquer Debt No Matter How Much You Have and he's been featured in MSN Money, Yahoo Finance, Fox Business, The Nightly Business Report, US News Money, and

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