Expert: Doctor Settlement - 4/14/2009

Question
I backed into my husband's business owned car in our driveway.  I was driving our personal car. My husband is a partner in the business and an owner of the business car.  Should my personal carrier pay for the damage to his car?

Answer
Hi Becky,

You are responsible for the damage, not your husband and his partners.  If you had no insurance, then their insurance would pay, less their deductible.  Then their insurer would come after you to pay them what they had to pay out.  Since insurers also frequently collect the deductible for their insureds, they probably would make you pay the entire amount.  Best to take care of this yourself: either paying the bill on your own or through your own insurance, depending upon the amount of the damages.

Since it is your liability, you will pay.  The only issue is whether or not to just arrange for the repairs on your own, or whether you want your insurer to pay and risk having a rate increase in the future by having your insurer pay.  

When you work with your own insurer, there is a chance you can make them pay, but avoid this being categorized as an "at-fault" accident for purposes of future rate increases.  It is possible, but not the norm, to have the repair bill paid by the insurer up to one dollar less than the threshold I am going to describe below.  Then you would pay the balance.  This is NOT an authorized procedure, so you would have to work it out with the adjuster that your insurer assigns.

I would first take a look at the amount of damages and then decide whether or not to pay outright or to make a claim for repairs.  Here is why: if you report an "at-fault" accident and your insurance pays more than a specified threshold amount, then that will count against you when it is time to renew your insurance.

Without reporting the accident you could inquire from your own company what the threshold amount is in order to allow them to count this as an at-fault accident for purposes of impacting your premiums.  Chances are you will learn, but not guaranteed.  The other way is to check with your state insurance commissioner http://www.settlementcentral.com/links.php

In many states, the state insurance commissioner has set a threshold amount.  If the damages paid by the insurer are LESS than that amount, then they CANNOT categorize this as an at-fault accident.  For example, in Washington, the insurance commissioner has set the amount at $750.  IF you can arrange for less than that to be paid out—and maybe you pay any extra—then your insurance will not count this against you.

I trust that my time here has produced some information that has been of value to you, and thus I would respectfully request that you take the time to locate the FEEDBACK FORM on this site and leave some feedback for me.

Best Wishes,

Dr. Settlement, J.D. (Juris Doctor)
http://www.SettlementCentral.Com