Can someone else make a claim on my car insurance?
February 18, 2006 6:31 AM   Subscribe

Can someone else make a claim on my auto insurance?

Let's say I am involved in a very minor collision with someone's car in a shopping mall parking lot. The other person claims it is my fault. I give the person my insurance information. After the person presents me with an exorbitant, inflated "estimate" of what it will cost to fix the damage, I make the person an offer to settle the case, of a little more than half of what they are demanding. The person rejects my offer.

The person (who has his own auto insurance) threatens to contact my insurance company and make a claim. Will my insurance company deal with this person? Is there any chance the insurance company will pay the person's claim? (Assume that the person knows which insurance company my policy is with, but that I have not reported this incident to my insurance company.)
posted by jayder to Law & Government (14 answers total)
You should report it promptly. Insurance companies look dimly on it when you aren't the one to report an accident to them. If you think the other person is filing a fraudulent claim, make that very clear.

As to whether or not they'll fight it, it depends on the company and the specific examiner. Many companies have a policy of fighting fraud tooth-and-nail, even if it costs them a great deal more to do it. That's why it's so important to be clear that you think the claim is fraudulent. Some companies and/or adjusters will just settle the claim anyway. That part is out of your control.

It's wise to always get a police report on an accident, no matter what. They can get a bit testy with you for asking them to do all the paperwork for a little scratch, but if you're both pleasant and persistent, I believe they are required to do so. Those reports protect both you and the other person. The more insistent the other party is about not getting a report, the more insistent you should be to get one. The only reason NOT to get one, basically, is if you plan on fraud. You sit right where you are and wait for that report, even if the other party drives off.

You need to get on the phone with your insurance company. Give them the whole story. From then on, it's their problem, not yours. If the other party contacts you again, just give them the number for the insurance company and ask them not to contact you again.
posted by Malor at 6:54 AM on February 18, 2006

Google "subrogation."
posted by yesster at 6:55 AM on February 18, 2006

Having had a number of accidents over many years of driving (don't ask), let me say that this scenario is why you have auto insurance. While it may at times be useful to avoid filing a claim for very minor damage (to avoid having your rates go up if you've had a number of accidents), this person is being impossible. Say nothing and sign nothing.

Report the fenderbender ASAP to your insurer and tell this person to contact their insurance company and/or your insurance company and to not call you again. The insurance adjusters will quickly hash this out, cut any damage estimate down to size and be done with it. Insurance estimates (at least in my experience in New York) are always inflated and just a starting point for negotiations between an insurance company and the body shop that will be fixing a car. It's a game.

Also, note that insurance companies now "record" your accident description when you call. This avoids filling out a bunch of forms and pins everyone down on their story. Think about what you want to say before you call.

Relax and don't worry. This sounds like a trivial matter. :)
posted by bim at 7:00 AM on February 18, 2006

Yes, of course the other driver can contact your insurance company. Usually his insurance agent will do this for him.

If you say it was not your fault and there are no witnesses or police report on the accident, your insurance company will probably refuse to pay anything to the other driver. However, the fact that you made an offer to settle suggests that you did admit fault.

In any case, don't go changing your story now. If you think it was your fault, you should take responsibility. If you think it was not your fault and you stated that at the time, your insurance company will take on the job of trying to prove or disprove that.

Your insurance agent will not be happy with you if the other driver calls them before you report the accident. It would be best to contact your agent now and explain the situation.

Here is some helpful advice on how to deal with accidents in the future.
posted by naomi at 7:09 AM on February 18, 2006

Also consider that the other person has zero incentive to find the cheapest estimate.
posted by smackfu at 7:44 AM on February 18, 2006

Also consider that the amount of damage in a low speed crash can easily top $1000 up to $2000, especially if fixed at the dealer. Personally, I think it's a scam perpetrated by the auto manufacturers, but IIHS (Insurance Institute of Highway Safety) has been documenting this for years. You can find official results on their site, but here is a good summary.
posted by Roger Dodger at 8:21 AM on February 18, 2006

Thanks for all these responses. Just to clear a couple of things up: the police were not called; there was no police report filed; there was no damage to my car; and the damage to the other car was basically some scraped paint.

Although I offered to settle the matter to avoid any further inconvenience, I am not persuaded that it was my fault.

I guess I am skeptical of the claim that I have an obligation to report something like this to my auto insurance company. My understanding is that I'm free to not report something like this; the other person can sue me and get a judgment, if a court determines I was at fault, and I can be compelled to pay a judgment---but otherwise, the other person can't do anything as long as I deny that I am at fault.

This happened a week ago. Yesterday, the other person threatened to go ahead and make a police report now, and then file a claim with my insurance company. But how would the police make any determination of who was at fault, a week after the fact?
posted by jayder at 9:24 AM on February 18, 2006

I would report it. I was on the other side of a very similar situation a couple of years ago, and did make a claim on the other guy's insurance directly (not through my insurer.) The representative I talked to was somewhat taken aback that this was the first they had heard of the accident and implied that Mr. SUV's rates were going to rise because he was at fault and hadn't let them know.

It's not just your insurance carrier you should be worried about either. I don't know what the law is in other states, but here in CA you are required to report accidents that result in injury or property damage greater than $750 to the DMV within 10 days, whether they occurred on public or private property and regardless of fault. Failure to report can result in a license suspension. (link)

As to the cost, body shops give tremendous discounts to insurance companies (or, if you like, tremendously inflate prices for the average consumer.) I got walk-in estimates ranging from $2200 to $2800 for a wrinkled fender and hood on an 11-year-old Civic -- his insurance company got the job done for less than $1500 at a shop that had estimated the job for me at $2500.
posted by harkin banks at 10:36 AM on February 18, 2006

I'm not sure where you are, but my understanding is that here, in Ontario, they'd make a claim with their insurance company, who would then contact your insurer, and come to some agreement with your insurer as to who was at fault for the accident. Then either your insurer or theirs would pay the claim.
posted by jacquilynne at 10:41 AM on February 18, 2006

...there was no damage to my car; and the damage to the other car was basically some scraped paint.
And if you're lucky, like me, the other driver will claim you totaled their car, you will protest, your insurance company will fail to investigate, you will indicate fraud is taking place, your insurer will ignore you, the other driver will have his car "totaled" and get $2,000 for a $20 scratch on a car that can't be worth more than $750.

People are strange -- insurance companies more-so.
posted by Mike C. at 10:44 AM on February 18, 2006

I'm with you. You have no legal need to involve your insurance company at all.

You have to have insurance by law - you don't have to use them at all.

That does mean you have to handle it yourself though.

Tell the other driver to tell his insurance company to contact you directly.

Good luck, you're going to need it.
posted by DrtyBlvd at 11:36 AM on February 18, 2006

This exact same thing happened to me last year.
I didn't report it to my insurance. (Allstate)
The other party did make a claim about 3 months later. I got lucky and had a picture of the 'damage' to their car at the scene, which was some scraped paint.
I did admit fault when my insurance called, because I did do it. The damage was far less than they were claiming however.

My insurance company got their paint fixed at the insurance co's rate, which ended up being around $150 total.

The other party claimed to be injured and had passengers that were injured.
The insurance wouldn't pay the money they were asking for based on my instructions. Noone had received medical care, so I figured it was BS and the insurance company told me that was probably a correct assesment. That part of the claim was denied.

They told me that I could be taken me to small claims court for the 'injuries' for up to 3 years. If I was sued in small claims, the insurance would still provide the $$ to pay if the other party happened to win, which they said probably wouldn't happen based on the evidence.

The insurance co. did tell me to let them know next time about even minor accidents promptly next time.
My premiums didn't change at the next renewal.
posted by whoda at 12:23 PM on February 18, 2006

But how would the police make any determination of who was at fault, a week after the fact?

The police aren't going to bother determining fault. They'll take a report but it will just be his statement. The insurance companies are the ones concerned with who is at fault.
posted by smackfu at 1:45 PM on February 18, 2006

You need to get on the phone with your insurance company. Give them the whole story. From then on, it's their problem, not yours. If the other party contacts you again, just give them the number for the insurance company and ask them not to contact you again.

What he said. In another life, I sold auto insurance. This is exactly what you need to do to resolve this in the best way.

If the insurance company decides to pay out, they will perform their own estimate of the damage and pay it accordingly.

If you don't let insurance handle it, then you have an issue for small claims court.
posted by frogan at 1:58 PM on February 18, 2006

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