Paying out of pocket and preventing future involvement of car insurance co.

May 26, 2009 2:57 PM

If I pay out of pocket for repairs to another driver's car, is there a form I can ask him to sign to prevent later involvement of insurance companies?

As I was backing slowly out of a parking space this afternoon, I bumped into another car. The other car was driving through the parking lot and not yet in a space.

The collision was so gentle that I didn't actually feel it, and the only damage to my car was a small crack in the paint on the corner of the rear bumper. The other car was a two-door model, and the only damage that we could see was a dent in the panel just behind the driver's door. The dent was about a foot across and looks like something that might easily pop out, but then there's the issue of repainting.

The other car belongs to the driver's brother; it is unquestionably still drivable and both the driver and owner live nearby. I admitted fault, but I pointed out that it was raining and that the other driver had not turned on his headlights, which certainly contributed to my failure to see his car. I'm in PA, where headlights are required when wipers are in use, and it was raining hard enough for that.

Given the headlight issue, I asked that the driver do me the favor of communicating to the owner that I am interested in paying out of pocket and not getting insurance companies involved. We exchanged contact and insurance information amicably, and the driver mentioned it was possible that his brother would decide to let the whole thing go (not that I'm pinning my hopes on this).

1. My guess is that repairs will run $200-400, and in this range I would rather pay out of pocket than report it to my insurance company and deal with increased premiums for years. Are these estimates reasonable?
2. I've never before been in a car accident where parties other than myself and a deer were involved. Is settling w/o involving insurance in any way illegal? If not, is there some standard form I could ask the owner to sign, when I hand over the check, to establish that the issue has been settled and prevent him from seeking money from my insurance company?
3. Would the driver need to sign the form mentioned above? I don't think there are any medical issues, but we did not discuss that explicitly.
4. If costs spiral out of control somehow, and I decide that I would rather have my insurance company cover the cost, how much of a delay in reporting the accident is acceptable?
5. The other car is 15 years old and worth $800-1200 according to KBB. It seems possible that the owner might prefer to have the cost of the repair in cash and either not repair the car or repair it when convenient (since the damage isn't a safety issue). Does offering to write him a check directly, either for the value of an estimate or for a mutually agreed upon amount, change any legal/insurance status?

Please don't tell me that I shouldn't have admitted fault. I think that it mostly was my fault, and paying a few hundred dollars out of pocket is no hardship. I would just rather avoid the insurance hike.

posted by ecsh to law & government (9 comments total)

1. Yes.
2. You can ask him to waive all claims related to the event. There's no "standard form." An attorney could draw one up. You could write one up yourself after a few Google searches to give you an idea of what you should include.
3. Yes, if you want to be protected against a medical claim.
4. Check your policy, but 30 days wouldn't be unusual.
5. No, provided that he agrees with it.

Note that the other party doesn't have to comply with any of your requests.
posted by Cool Papa Bell at 3:06 PM on May 26

I'm sorry, but I can't help myself.

As a Maryland State Trooper once told me and two out of the other four drivers involved in a multiple vehicle rear end collision on an interstate highway, "If that guy (as in, the guy who apologetically announced right off the bat to the trooper that he'd caused the accident) had kept his mouth shut, nobody would be getting charged here."
posted by imjustsaying at 5:25 PM on May 26

I had a similar situation that I reasoned and resolved in the manner you're thinking of.

I paid the small repair cost out-of-pocket, per an estimate from a body shop in exchange for a signature on a receipt/document to prevent insurance company involvement. Weeks later, I was notified that the other party notified my insurance company anyway. No additional payouts were made by my insurance company (thanks to the signed document), but the registered claim was sufficient for a strike against me.

According to insurance agents I spoke with, whether or not an insurance company will register a zero payout claim as a strike would vary from company to company, and would depend on amount of damages involved. But the likelihood of a strike is great with any, including minor, collisions.
posted by MD06 at 5:27 PM on May 26

If there's any possibility at all that your insurance company could find out about this, you probably need to disclose the incident to them yourself. Check your policy. Many of them include language that an insurer can use to deny future claims if you have withheld information that might reasonably have a bearing on your premiums.
posted by flabdablet at 5:41 PM on May 26

To add on to what flabdablet and MD06 said about reporting the incident to the insurance company: if the other guy reports it, and you do not, they *will* raise your rates (I can attest to this happening to an acquaintances with Allstate).
posted by misha at 6:02 PM on May 26

Worse yet the owner of the car can throw away your contact info, call the cops & claim hit & run & he has his no headlight using brother say you took off. ALWAYS call the police. Let them say "it's under $500 (or whatever amount in your state) exchange your info & be on your way" Parking lot accidents do not normally get tickets as it is private property. But hit & run is a criminal offense.
posted by patnok at 6:06 PM on May 26

...except in patnok's hypothetical, how would the poster have the other guy's information?

I was in an accident in a parking lot where the other car didn't have headlights on (at night). She called her dad, who drove over (couple miles) and yelled at me, a lot. However, we agreed not to contact insurance companies. However, when he was unable to contact me at 6:30 the next morning at home (I was on the way to work), he called my insurance company immediately. This led to them dropping coverage on me six months later, on the day I got in an accident, which led to my getting my licence revoked (driving without insurance) which led to a pleasant stay in the Russell, Kansas jail about six years later.

Get a waiver, even if you write it yourself.
posted by notsnot at 6:24 PM on May 26

Thanks for the comments so far. I definitely appreciate those from people with similar experiences, despite neglecting to ask for anecdotes, and would be happy to hear more.

I RTFPolicy: they want to be notified "as soon as possible", but I figure it's reasonable to wait to talk to the other owner. It's Geico, and it looks like (w/o a traffic violation), if their payout is less than $1350 and this is my only incident in a while (it is), the accident is not surchargeable. So I'm currently leaning toward reporting.
posted by ecsh at 7:50 PM on May 26

I was in a similarly minor accident a couple years ago. My insurer, Progressive, found me not at fault and "waived" the claim since they didn't pay out anything (the damage to my car was less than my deductible). My premium did not go up.
posted by katieinshoes at 9:07 PM on May 26