Dear PoPville – Question regarding auto accident insurance settlement

Photo by PoPville flickr user philliefan99

“Dear PoPville,

I was rear-ended a couple weeks ago. Luckily, I’m okay, and just had some minor aches/pains after ‘the accident’. I did everything I was supposed to do: called my insurance immediately, went to the doctor, got my car fixed, etc. I missed some work; although my car didn’t look damaged at all, it turns out there was $750 worth of damage behind the bumper and some scratches that needed to be fixed. That said, it was as ‘basic’ of a car accident as one could have and thankfully no one was hurt.

I went through the other party’s insurance. Now the insurance company is ready to settle with me. They suggested settling shortly after I went to the doctor but I said I would prefer to wait a week or so since whiplash can surface later. Now that I’m ready to settle, I have a couple questions:

(Disclaimer: having never gone through something like this before I declare my ignorance on the matter. I appreciate the reader’s patience with my naive questions and/or irrational fears.)

1. Is there anything bad about settling with an insurance company? For instance, would this in anyway look poorly on some ‘record’ of mine, raise my insurance preium somehow, and/or put me in a position where I would be sued or something equally intimidating that would involve me owing money to someone? Frankly, is settling the smart thing to do or could it end up having a negative affect on me?

2. The agent handling the bodily injury side of the claim has offered a lump sum, calculated by pro-rating my salary based on how much work I missed and ’emotional distress’. The car was dealt with through the collision center and everything was taken care of…eventually…but not without it being a complete pain in my arse. Basically I was told that I would get the are by a Friday but no later than Monday afternoon, then Monday afternoon, then told Tuesday, and then finally got it back on Wednesday. I opted out of the rental car that was offered because I knew I could live without a car for a few days (and I didn’t feel like being responsible for a vehicle when the hurricane hit!!), which I did, but it turned out to be a very stressful ordeal. I told the collision center I felt like I was being jerked around because they kept telling me one day and then post-pone it to the next. Finally, when I picked up my car I drove away only to hear a new, very obvious noise. I turned right back around to take it to the collision center and ended up leaving my car for two more days so they could figure what was wrong with it. It was eventually fixed.

Long story (kind of) short: am I in a position to ask for more money from the bodily injury agent for ’emotional distress’ related to dealing with the car crap, and if so, how do I ask?

3. What type, if any, documentation should I expect to receive/make sure I ask for my records keeping?

Thanks so much for your help, PoPville!”

22 Comment

  • ah

    There’s nothing wrong with “settling” — they’re just trying to close out the claim. You could ask for a letter confirming their insured (the other driver) is at fault, if it would make you comfortable. Or call your insurance company to ask.

    As for “pain and suffering” of getting the car fixed, not really. I agree, it’s totally annoying. You’re simply not fully compensated for the hassle that you still must bear. (I had a similar story–even though the other driver’s insurance paid, I still had to spend time going to the autobody shop, then going back when they didn’t do something right, arranging for a car rental, picking it up/turning it in–all told probably a day of stuff over two weeks).

    You might remind them that you didn’t take the rental car, but the repair shop (did they recommend it?) really wasted your time and you should get the rental car money in lieu of the rental car. That’s probably an extra $150-200.

  • What “Ah” said – settling means accepting the insurance company’s payment(s) so they can close out the claim on their side. There is also probably verbiage stating as part of the settlement, you cannot come back at a later date and ask for more money, even if it’s a problem resulting from the accident that wasn’t discovered until later.

    I would look at asking for more money in terms of percentages. If you ask for more than an additional 10% of the offered payment then be ready to be turned down. If you want to pursue further than that you’ll need to be prepared to get a lawyer.

  • They should settle for the amount of the car repair, transportation expenses while you were without a car, and any medical bills incurred. Why did the OP not just have his insurance company subrogate all this? It is a lot less hassle that way since it is all handled by someone else and you will get paid the expenses you are out. This is why you pay insurance premiums, so you don’t have to deal with all this legal mumbo jumbo.

    • Thanks so much for the feedback, everyone, I really appreciate it.

      Good question – when I asked my insurance company about subrogating it they told me it is standard of practice for me to work directly with the other party’s agent. The other party claimed responsibility so I am going through the other party’s insurance (not mine). Perhaps they were just pulling a fast one on me even though they were supposedly working in my ‘best interest’ as my agent. Let me know if that is a situation where I should have demanded they sort it out.

      • I agree with Anon above. I’ve never understood why people directly deal with insurance claims. I had a horrible, horrible car wreck a few years ago. My agent completely handled it and I did nothing but go cash a check worth more than the value of my car and injuries together.

  • Depending upon the OP’s age and health history – settleing with the insurance company and releasing all liability now may be fine. Then again there is no harm in waiting to see if the accident leads to additional issues.
    If I were you, I’d send the insurance company a letter stating that you’d like to wait and see if additional issues arise and will contact them in 3-6 months with a response to their request to settle.
    Waiting costs zero dollars but could save you a lot in the long term.
    In February, provided you are fine health-wise and agree to the insurance company’s settlement offer let them know that you are ready to discuss settlement. Let them respond with another offer and determine if you are okay accepting the settlement. Don’t forget that your car is now worth less having been in an accident – so factor that into what you ask from the insurance company.

    Good luck and glad to hear you are okay.


  • anonymouse_dianne

    It is OK to settle, but take the advise my sister (an insurance claim rep) gave me under a similar situation — wait until your case floats up to someone with the authority to authorize a significant settlement. In my case I broke my wrist, and my car was totalled. The initial offers were under $1k and ended up settling for more than twice that (circa 1993).

  • I used to work in this area, so hopefully I can give you some valid insights.

    1. There is nothing wrong about you settling. The insurance companies data base will reflect that you settled a case (the insurance companies know so much about us all it is scary…some things are better not to think about, kinda like marketers). It shouldnt have an effect on any future cases unless this kind of accident/settlement becomes a habit for you. The settlement itself will come with a document to sign giving up your rights to a lawsuit based on the accident. You can ask (but arent likely to recieve) something saying that their insured was at fault…but they probably wouldnt be settling (even for a small amount) if that weren’t the case.

    2. You are in a position to ask for pain and suffering, although your pain and suffering is likely to be minimal in this case. But dont sell yourself short…you dont HAVE to accept their settlement. In the OLD OLD days (lonnnng ago) the rule was damages times three. Total your medical bills and property damages and multiple them by three and this would be a reasonable settlement. For a smaller case like yours, if you walk away with your bills paid and a few hundred in your pocket, you probably did very well…even if there were hassles.

    3. see above…you are going to have to sign something when you get your check that releases the claims. You should keep a copy of this for your records…lord know the insurance company will.

    You should be in no rush to settle. Make sure everything is wrapped up tight…your body is healed (nothing lingering) and your car is operable again. Once you are certain enough that you are done, go ahead.

    This is not intended to be legal advice. Should you have questions of a legal nature you should contact an attorney.

  • So I just settled an insurance claim myself, but let me settle what it took me a year to figure out – don’t be afraid to haggle. Now I (my person) was hit by a taxi in Chicago so my case is a little different, but as my mother pointed out try to get as much as possible b/c you never know what issues will come about from it and all you get is one chance. So if that means pleading emotional distress – then DO IT. You don’t need to tell them a sob story, but if you were doing everything right in the situation then let them know that you were and that now you’re afraid of what could happen – even when you do everything right.

    Also wait until all the bills are in – and if you’re not sure if they are then wait – but begin haggling now – just let them know that there may be more expenses. Talk to a lawyer (my cousin just graduated from law school so he helped me) and get an idea of what you would get if you went to court. Then start a little above that b/c their first offer is going to be so low it’ll be offensive. Eventually negotiate up to where you would get if you went to court – b/c in the end of the day the fees alone would outweigh whatever they’re going to pay them.

    Lastly, keep everything!! Every letter, bill, invoice, check. While insurance settlement money is not taxable according to the IRS, you’ll want it in case anything goes wrong. Also if there’s a lien on any account (as there was on one of mine), ask for a release to be sent to you and the insurance company. And then keep it!

    Hope this helps!

  • normally i am not so snarky, but something about this post bothered me. the poster was hit by another car, but the damage was so minor that you couldn’t even tell the car was hit and there was only $750 worth of damage (which is nothing, as body repair work goes). and yet he/she is worried about whiplash (you felt the need to go to a doctor for this?) and also wants compensation for having to deal with annoying people? car accidents suck, but they happen, and the poster should be thrilled that it was so minor and they weren’t hurt. he/she should have taken the rental – it was free to them. but they didn’t, and now they want compensation for having a frustrating few days.

    i was rear-ended last month and there was serious damage (that cost $3,000 to fix and the car was not driveable), and i had to deal with getting the damage assessed, bringing it to a shop, getting a rental, etc. it sucked, but i managed. however, i never felt the need to get checked by a doctor — there’s no way you can get whiplash from a car accident so minor that it causes no visible damage to a car, unless the poster drives a recommissioned tank.

    rant is over. sorry. it just seems like the poster is way overreacting to this situation and is expecting an unrealistic level of compensation.

    • Um wrong. Please stop acting like a doctor, you’re not one.

    • That was my thought, too. I can’t imagine how a properly restrained driver would have any injuries at all from a tap on the rear bumper. And a $750 bill from a body shop suggests that it was nothing more than a tap.

      • ah

        To be fair, the OP said he wanted to wait to see if he developed symptoms, but now is ready to settle.

      • I drive a sport ute that’s a little high, with a big towing hitch. A guy back ended me a month or so ago and totally wreck his front end. My truck was unhurt but for a few scratches. I’m big & fit but could see my wife or kid getting hurt in that crash. So you just don’t know.

    • I had some of the worst headaches of my life after being rear ended on a rainy day and the damage came up to only 1k. Remember, damages can vary base off of the year, make and model of a car. The cost could just mean it was an easy car to fix, not how much force the vehicle was hit with.

    • notlawd

      I completely agree with this. I was starting to think there was something wrong with me after reading the comments. I have had someone I hit come back and claim injury in similar situation, so I admit I am biased, but it seems to me that OP needs to chalk this up to things happen and be thankful it was only a bit of a hassle.

  • true. but i used to work in a doctor’s office that handled cases exactly like this one and the docs repeatedly said that about 80% of all these cases were bogus. and they were probably being generous.

    there is a significant amount of fraud in the “pain” arena.

  • I think you’re getting a good deal. You should take the money and run — the sum/settlement amount won’t matter when calculating future premium. The insurance company won’t ask for any of that money back, unless it suspects fraud. If you are happy with your situation, have no more injury and your car is fixed — then what else do you need, just take the money. The last thing you want is for an insurance company looking into your life more than it already has… And, the time you missed because of injury and the time you missed repairing your car are two totally different things. Next time, take the rental car if it’s available.

    Keep all documentation from the accident. You should receive everything you need from the AD.

    As far as the service at the repair shot, the insurance company will want to know your experience and may decide to not do business with that shop again. The repair should be covered by the insurance company for the remainder of the life that you own the car — even if you find damage later. If, by chance, you have that noise come up again, you can claim with your company that it was from the old accident and you can probably decide to take it to another facility for repair. Not every insurance company offers the same level of options for service repair locations, but if you are with a large company then there should be some kind of repair guarantee.

    BTW, asking this type of question on open forum will bring a lot of “advice” that may or may not be true (and people will give you their bad experiences over their good ones — and say that’s the way it ALWAYS happens). Not that I want to be dad, but it’s up to you to read and understand your contract, and educate yourself on what your insurance will cover you for in the event of a loss. To know the truth, call an agent with your insurance company and ask questions about your coverage. There’s no reason the insurance company wants to “lie” or “trick” you into anything, unless you are lying or trying to play a trick on it.

  • If the person who hit you was smart they would simply fork over the cash from their own pocket. I’m surprised they even wanted to put it on their insurance. Don’t be “that person” and basically ask for money for pain and suffering that wasn’t truly suffering..that’s what is wrong with people these days! Car wrecks stink, yes. Someday I’m sure you’ll put someone in the same position you were just in.

  • Don’t forget to ask for loss of value for your car. You car is now worth less then it was before because it’s been in an accident. They should compensate you for that.

  • Thanks so much for the constructive feedback and well wishes, everyone. This is very helpful since it’s good to get an idea of the protocol and different experiences people have had in similar situations.

    To all the skeptics…thanks for the vote of confidence, even with the disclaimer. 😉 If you knew me personally you’d be laughing if someone told you I was trying to game the system. I have a history of being a ‘do-the-right-thing-a-holic’. It can be problematic. 😉

    All of you that wrote in and shared your personal stories – I hope you’re okay. Here’s to no one ever dealing with the most basic or serious accident of any kind! Thanks, PoPville!

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