Questions and Answers to Auto Insurance Settlements

Dealing with the claims division of an insurance company is not something anyone likes to do. We certainly don’t want to have to do it often. Because most of us don’t have to do it often, many people are naturally apprehensive when doing so and may have questions about the process. While the questions that are asked of insurance adjusters and claims officials can range from the mundane to the absolutely bizarre (“What do I do if my girlfriend’s cashmere sweater was irrevocably damaged in my car fire? Can I include it on the insurance claim without my wife finding out? By the way, it’s her car.); many of these questions are very valid and completely deserving of direct answers. Presented here are some of the most common questions and answers to auto insurance settlements.

Q: Who pays for the damage incurred in an auto accident?

A: The answer to this question depends partially on the type of insurance coverage you carry on your automobile and partially on who was at fault (if anyone) in the accident. If all you’re carrying is the state required liability insurance (the requirements of insurance laws vary by state) then your insurance company will pay for any damages caused by you to the property of others. Conversely, this means that if you did not cause the auto accident but another driver did, it will be that driver’s insurance company paying for the damage to you and your vehicle. This is a strong argument for carrying collision protection and uninsured/underinsured motorist insurance coverage in addition to the property damage liability and personal injury protection that is likely required. The only thing that could be worse than not having insurance in a situation like this is not having enough coverage.

Q: I see ads for auto accident injury lawyers all the time and have heard horror stories about the lawsuits that arise from auto accidents. What do I do if I get sued after an auto accident?

A: First of all, it’s unlikely that you, personally, would be sued at all after an auto accident. The personal injury lawyers that you see on TV are not interested in dragging some average person through court. Unless you have considerable attachable assets they know that all they’ll get is an uncollectible judgment. These attorneys are experts at negotiation. When someone hires them they typically negotiate with the other party’s insurance company in order to obtain as large a settlement as they can. In turn they will negotiate with doctors, hospitals, chiropractors, auto mechanics, and anyone else who is due any kind of payment or settlement by the injured party to attempt to get the fees and amounts due reduced. They do this because they know that, once a settlement is reached, all of those parties with a claim collect first. By reducing the amount of those bills and increasing the amount their client keeps from the settlement, they are ensuring that they will get their percentage. Rarely do auto accident injury cases ever see the inside of a courtroom. When they do, it is often the insurance company being sued, not the individual. Of course if you are on the receiving end of a lawsuit for any reason you need to contact an attorney of your own.

Q: What is really meant by the term “Total Loss?” A: The insurance company considers a car or auto to be an “economic total loss” when the projected cost of repair service, rental reimbursement (if any) and other details involved in restoring a vehicle to its pre-accident condition exceeds the cost of simply buying the auto at its pre damaged value. There is also the “constructive total loss” when the auto is simply beyond repair.

These are just a few of the many possible questions and answers to auto insurance settlements and you may have other questions of your own if involved in such a situation. Your insurance agent or adjuster answers questions like these all the time and will certainly be able to help you with any questions you may have. No matter how mundane or odd you may think your question is, ask anyway. The chances are good that the representative has heard it before.