I got into an accident where I probably was at fault because I changed lanes into the other car’s. I drive a 2016 Corolla, and the other guy was in a 2023 Cadillac Escalade, so his repair costs were way higher than mine. My damage is about $1,000 (needs a new fender and some bumper paint). But his damage ranges from $4,000 to $6,500 (two aluminum doors dented, wheels scratched, running boards damaged, and some scratches).
This is my first accident. I have full coverage with a $500 deductible, but I don’t have accident forgiveness. I’m 21 with around 3.5 years of driving experience, and my insurance is about $1,000 every 6 months.
He offered to settle if I pay $4,000, but if we go through insurance, he’s planning to sue for additional money to cover the loss in value on his luxury SUV. If he sues, my rates might go way up, possibly costing me more than $4,000 over the next few years. If I get sued, could I just switch insurance to avoid some of the rate hike, or would that make no difference? Any advice on whether I should settle or let insurance handle it?
Settling by yourself usually backfires. The other person might come back asking for more money, saying repairs went up or they need a rental. Or worse, they could take your payment and still file a claim with insurance. Just use your insurance and let them handle it. That’s why you pay them.
Definitely go through insurance. You’re paying for their protection. Rates might go up at renewal, but that’s the time to shop around for a better rate if needed. And with insurance, you’re covered for all damages up to policy limits, including any injuries they claim. If you settle directly, they could ask for more or even bring in a lawyer later. Insurance has got you covered.
If you do settle, make sure they sign a release, but it’s usually better to let insurance handle it. They’d likely raise your premiums, and switching insurance wouldn’t prevent that increase since you’d still need to disclose the recent accident. If a lawsuit gets filed, the new insurance will see it, so it could still impact your rates.
Go through insurance. Someone hit me once, and it ended up costing $5,500 for repairs and another $3,600 for a diminished value claim plus rental fees. My total came to the at-fault driver’s $10k policy limit. With a high-value 2023 vehicle like the other driver’s, your insurance may end up covering quite a bit. I had to go to small claims to get everything covered, so insurance is definitely the way to go.