There are a lot of twists and turn on the road of auto insurance policies. Car insurance, because of its nationwide use case and millions of customers, is nothing but complicated. All the traffic accidents and millions of drivers on the road, there is nothing “simple” about vehicle insurance procedures. For example, how do auto insurance companies pay out claims?
If you have a car insurance policy, could be liability coverage or comprehensive coverage, unless you make a claim, you have no idea how the entire payment procedure works. This article will describe in detail everything you need to know about car insurance claim payout and the necessary steps you need to take to ensure a smooth, hassle-free process.
Insurance Payout Process
The moment you get in a car accident, you should start the claim process. But before you call the insurance company, make sure you complete these steps before, or else the claim process can take more time, get more complicated, or worse, get rejected.
Call the police: Getting the authorities involved is perhaps the most important step for any car insurance claim. This is because auto insurance companies need to be sure that the claim is legit and not insurance fraud. Your car insurance company will most probably require the police report of the accident, so as soon as you get out of the accident, call 911.
Take pictures and videos: To show the damage to the car, you must take pictures and videos of your car and the other car as well. Do not try to move the car, or drive it anywhere. Make a video and describe how the accident happened. The best thing to do is have a dashcam to record everything beforehand.
Claim Processing: After all that’s done, contact your insurer or insurance agents and tell them all that happened. They’ll visit the accident site, take a look at the accident, and then the claim processing will start. You’ll be asked a few questions, and if everything fits well with no suspicion of insurance fraud, your claim will be approved.
Claim PayoutThe claim payout process can vary depending on the type of car insurance policy you are claiming. Most of the car insurance claims will result in the direct payment of the bills to the different businesses involved in the accident.
For example, if your car was damaged, and you claimed your collision insurance policy, after the verification, the car insurance company might ask you to go to a specific car repair shop, and then pay the bill directly to the shop. The same applies to medical treatment claims in liability insurance or personal injury protection plans. The insurance company directly pays the hospitals.
But in some cases, the claim payout procedure can be slightly different. For example, if your car gets totaled in a car accident or gets stolen, you can get the actual cash value of the car through a bank check or wire transfer. But this is only applicable if you have the right car insurance policy.
Get the Coverage
Before you make a claim, you need to have the appropriate car insurance policy for the damage or the accident. The type of accident and the cause of the accident play a major role in the insurance payout. Let’s take a brief look.
Liability Coverage
Liability coverage is not for the policyholder, but to pay for the accidents caused by the policyholder. If you are at fault for a road accident, the other party (who gets damaged, or whose property gets damaged due to the accident), can claim your liability insurance to get reimbursed for the losses.
Liability insurance benefits you as you do not have to pay the enormous amounts from your pocket, but your insurance company pays for it. Driving uninsured is a big risk, both legally and financially. Also, keep your coverage limit as high as you can afford to ensure that you are not underinsured.
Liability coverage can be one of the most expensive car insurance policies, and if your driving record or credit score is poor, you might end up paying even more. So when looking for car insurance policies, be specific with your search and compare as many auto insurance companies and their plans as possible.
For example, if you are a resident of Georgia, then look for the cheapest auto insurance in Georgia. Then compare all the plans available and select the policy that has the best price-to-benefits ratio, i.e., lower price, better coverage.
Collision Coverage
In any form of collision accident when your car collides with either another car or something else like a wall or a tree, you can claim your collision insurance policy and get reimbursed for the cost of repairs. The claim amount is usually paid directly to the repair shop.
In case your car gets totaled, you’ll get the actual cash value of the car in a bank check, or maybe a wire transfer depending on your preference or the car insurance company’s policies.
Comprehensive Coverage
The very same rules of insurance claim payout apply to comprehensive insurance. The entire cost of repairs will be directly paid to the repair shop unless the car is totaled or stolen. In that case, you’ll be paid the actual cash value of the car through a check or wire transfer.
Personal Injury Protection/ Med Pay
For car insurance policies that cover medical treatments, such as Med Pay or a personal injury protection plan, your insurance company will pay the coverage amount (if the medical bills are below your coverage limit) directly to the hospitals once the treatment is finished.
That’s how you get your car insurance claim payout. Remember to have a sufficient coverage limit as being underinsured can lead to you paying the extra money from your pocket.
If you have a car insurance policy, could be liability coverage or comprehensive coverage, unless you make a claim, you have no idea how the entire payment procedure works. This article will describe in detail everything you need to know about car insurance claim payout and the necessary steps you need to take to ensure a smooth, hassle-free process.
Insurance Payout Process
The moment you get in a car accident, you should start the claim process. But before you call the insurance company, make sure you complete these steps before, or else the claim process can take more time, get more complicated, or worse, get rejected.
Call the police: Getting the authorities involved is perhaps the most important step for any car insurance claim. This is because auto insurance companies need to be sure that the claim is legit and not insurance fraud. Your car insurance company will most probably require the police report of the accident, so as soon as you get out of the accident, call 911.
Take pictures and videos: To show the damage to the car, you must take pictures and videos of your car and the other car as well. Do not try to move the car, or drive it anywhere. Make a video and describe how the accident happened. The best thing to do is have a dashcam to record everything beforehand.
Claim Processing: After all that’s done, contact your insurer or insurance agents and tell them all that happened. They’ll visit the accident site, take a look at the accident, and then the claim processing will start. You’ll be asked a few questions, and if everything fits well with no suspicion of insurance fraud, your claim will be approved.
Claim PayoutThe claim payout process can vary depending on the type of car insurance policy you are claiming. Most of the car insurance claims will result in the direct payment of the bills to the different businesses involved in the accident.
For example, if your car was damaged, and you claimed your collision insurance policy, after the verification, the car insurance company might ask you to go to a specific car repair shop, and then pay the bill directly to the shop. The same applies to medical treatment claims in liability insurance or personal injury protection plans. The insurance company directly pays the hospitals.
But in some cases, the claim payout procedure can be slightly different. For example, if your car gets totaled in a car accident or gets stolen, you can get the actual cash value of the car through a bank check or wire transfer. But this is only applicable if you have the right car insurance policy.
Get the Coverage
Before you make a claim, you need to have the appropriate car insurance policy for the damage or the accident. The type of accident and the cause of the accident play a major role in the insurance payout. Let’s take a brief look.
Liability Coverage
Liability coverage is not for the policyholder, but to pay for the accidents caused by the policyholder. If you are at fault for a road accident, the other party (who gets damaged, or whose property gets damaged due to the accident), can claim your liability insurance to get reimbursed for the losses.
Liability insurance benefits you as you do not have to pay the enormous amounts from your pocket, but your insurance company pays for it. Driving uninsured is a big risk, both legally and financially. Also, keep your coverage limit as high as you can afford to ensure that you are not underinsured.
Liability coverage can be one of the most expensive car insurance policies, and if your driving record or credit score is poor, you might end up paying even more. So when looking for car insurance policies, be specific with your search and compare as many auto insurance companies and their plans as possible.
For example, if you are a resident of Georgia, then look for the cheapest auto insurance in Georgia. Then compare all the plans available and select the policy that has the best price-to-benefits ratio, i.e., lower price, better coverage.
Collision Coverage
In any form of collision accident when your car collides with either another car or something else like a wall or a tree, you can claim your collision insurance policy and get reimbursed for the cost of repairs. The claim amount is usually paid directly to the repair shop.
In case your car gets totaled, you’ll get the actual cash value of the car in a bank check, or maybe a wire transfer depending on your preference or the car insurance company’s policies.
Comprehensive Coverage
The very same rules of insurance claim payout apply to comprehensive insurance. The entire cost of repairs will be directly paid to the repair shop unless the car is totaled or stolen. In that case, you’ll be paid the actual cash value of the car through a check or wire transfer.
Personal Injury Protection/ Med Pay
For car insurance policies that cover medical treatments, such as Med Pay or a personal injury protection plan, your insurance company will pay the coverage amount (if the medical bills are below your coverage limit) directly to the hospitals once the treatment is finished.
That’s how you get your car insurance claim payout. Remember to have a sufficient coverage limit as being underinsured can lead to you paying the extra money from your pocket.