Expert: Richard Hixenbaugh - 3/16/2009

Question
We're trying to decide whether or not to submit a claim for damage I did to the family van done while backing out of the garage. No other vehicles were involved and no injuries were sustained.  I brought the van to a local auto body place and they quoted me approximately $1500. We had hoped to trade the car in some time this spring, figuring we wouldn't get much more than $3000 trade in value (it's a 2004 freestar), but with the damage we'd certainly get much less. We have a $500 deductible, so no matter what (unless we do nothing), we're out $500 at a minimum. We want to know how the claim could potentially increase our premiums, but are concerned that just bringing the damage to the attention of our agent and asking the question  about the premium increase (not even making the claim) could be a problem.  This probably seems like a strange concern, but we once had a problem with our personal property insurance company (not the same as our auto insurer) in which simply our calling to ask if a particular item we had lost on vacation was or wasn't scheduled was reflected in their accounting as a claim. We never did submit a claim on the lost item, but because they had the question listed as a claim (unbeknownst to us), we were later denied home insurance with another insurer because we didn't include any information about the lost item on our application for home insurance. Bottom line: does simply asking a question about the impact of an accident on one's premiums have the potential of increasing one's premiums?!

Answer
Hi Shawn,

Great question!

Often insurer will increase your premiums just for asking the question. The best way to handle this would be to call your agent that sold you the policy (not the claims department)and simply ask a "hypothetical question". Do not tell them that the damage has actually occured, but simply what the effect would be with say a $1500.00 collision claim. That should get you the answer you need without risking the premium increase. Generally speaking though, a small claim like you are speaking of would likely increase your premium anywhere from 0 to 15% depending on your insurance company.

I hope this helps
Richard Hixenbaugh