Car Insurance question

Horsehound

Hi, I had a small car accident that involved myself and another car - my fault so I notified my insurance company as advised, but I have gots quotes in to fix the cars and it would be best for me to settle myself with cash rather then go through the insurance company and lose my no claims bonus
My question is, if I settle with cash have I made the mistake of notifying my insurance company- Will they still have a claim against my policy even if I did not go through with the claim?Have I messed up by notifying the insurance company?

peteb2

No. You're fine. Just tell them you don't want to proceed. Even if they did pay out you could repay their outlay and have your bonus reinstated

coylemj

Make sure that the quotes you got will 100% fix the two cars because if you pay out cash and there is a subsequent 'discovery' that the damage is greater than first thought, you may find that it would have been better to let the insurance deal with the repairs from the start. If you pay the other guy in cash, it's a done deal and your insurance will not deal with his damage later, they simply won't want to know.

Several years ago I was in a crash which, like you, was my fault and I decided to settle it myself with cash. There was no messing with the other guy, he took the money and I never heard from him again. The problem was with my car, the damage to the front axle or steering was greater and more expensive to fix than at first estimated. I then found that while it would have been better to let the insurance deal with the original situation, I was now financially trapped in that the increase in the cost of repairs was still below the threshold for handing it over to my insurance so I had to pay the difference and just lump it.

An expensive lesson learned - get everything checked from top to bottom before handing over a cent to the other guy or letting your own repair shop start working on your car. If you get a sniff that you might be looking into a financial black hole, let the insurance deal with it.

FranklinMint

Hi,Sorry to jump in with a query

What happens if you notify your insurance Co. of a minor incident where there's no claim being made or money changing hands.

How long does the incident stay on file and do you have to notify future insurers ?

Incident was a few scratches to older cars but I notified them for peace of mind as I understood it's a condition of the policy?

peteb2

No claim, no history.

FranklinMint

peteb2 wrote: »

No claim, no history.

Ok thanks

I was worried it might be an issue where you'd have to wait a certain time before it was wiped off the file.

Can you just move on to another insurer without notifying them of the incident when there has been no claim made by either side?

peteb2

It depends on the manner of how the questions is posed by insurers. Normally if you need to declare it, and you are saying nothing happened and your no claims bonus reflects the same you would not get penalised.

NUTLEY BOY

Just a few general observations on issues arising.

Notifying your motor insurer after an accident is always the right thing to do.
It is a statutory obligation and a contractual obligation.

You really should get agreement from your insurers before proceeding to negotiate a settlement with a third party. To do otherwise is probably a breach of policy conditions.

Settling a property damage claim may not be the end of it. The other party can always bring a personal injuries claim later as that is a separate right of action.

If I was settling directly I would want a signed discharge from the other party to prevent them coming back for a second bite of property damage. Alternatively, pay them by cheque but imprint a discharge wording on the reverse of the cheque whereby cashing it constitutes acceptance of final settlement.

Remember that initial crash repair estimates are always subject to stripping and possible discovery of additional damage once dismantling starts. +1 coylemj's observations on the matter.

P.S. Not advising new insurers of an accident is non-disclosure.

FranklinMint

I thought it was just claims or open claims you had to notify when changing insurer

NUTLEY BOY

FranklinMint wrote: »

I thought it was just claims or open claims you had to notify when changing insurer

It probably depends on the exact wording of the new insurers proposal form or statement of assumptions i.e how they frame the question.

Even if your claim was settled at nil cost you would probably need to notify the new insurer of the fact that you had an accident. Even though it might make no real difference to an underwriter you always leave yourself open to a policy being cancelled ab initio if there has been non-disclosure. That, in turn, creates further difficulties.

Also, insurance contracts are written on an uberrima fides basis so they might get you anyway if you do not disclose. If you disclose you are on the right side of matters.

The duty of disclosure is quite strict in it's nature.