How to steer clear of claim trouble in six auto accident scenarios

In a perfect world (or even in a not-so-perfect world where accidents happen), an auto insurance accident claim would go smoothly. Unfortunately, there are countless scenarios that can throw you for a loop.

You can take precautions and avoid hassle by knowing what to do after an accident. Here are the answers to six common car-accident scenarios so you can curtail trouble before it starts.

Scenario No. 1
You slide on a slippery road and drive into a guardrail, damaging your vehicle.

What you should do: Notify your insurer and file a claim on your collision insurance to cover the damage to your vehicle. Even though it was a one-car accident, call the police to file an accident report. A police report will provide documentation of the crash, and this will make filing your claim easier. It's best to call the police when your vehicle is still at the scene of the accident, but if a phone is not nearby, call the police as soon as possible.

The National Association of Independent Insurers (NAII) says that in general, you may not receive a premium increase if you make a claim on your collision insurance because you did not cause the accident. However, if this is one of several claims you have made in the past couple of years, your insurance company may raise your premium if it has not done so already.

Also, an insurance company may also raise your rates if it finds that you were not taking precautionary measures while driving in the slick road conditions. For example, if the police report says you were speeding on the slippery road, your insurance company may find you partially at fault, and thus raise your rates.

If you don't have collision insurance, you'll have to pay the bill yourself.

Scenario No. 2
Your vehicle is hit from behind at a stop sign. The other driver is found at fault. You exchange insurance information at the scene, but the other driver does not report the claim to his insurance company.

What you should do: Along with exchanging information with the other driver at the scene, such as address, phone number, and insurance policy information, be sure to get the phone number of his insurance agent or the insurance company's claim number. That way, you can contact his insurer directly if he is negligent in doing so.

However, if you contact the other driver's insurance company, many insurers will tell you that they cannot begin processing a claim because they have not yet received a report from their policyholder. If that's the case, ask the company to contact their insured. You should say, "Here's the number that I have, and this is the damage that was done. I would like you to contact your insured."

If that doesn't work, contact your own insurance company and file a claim under your own collision insurance if you have that coverage. You will have to pay the deductible to get your car fixed, but your insurance company should be able to get it back for you. Your insurer will pick up the check for the damages, but it will pursue reimbursement with the other insurance company (a process known as subrogation). In general, it's easier to deal with your own insurance company because you are a first-party claimant.

For more on third party claims, read Dealing with another driver's insurer when a crash is not your fault.

Scenario No. 3
You are hit by an uninsured motorist and you do not have uninsured motorist insurance coverage.

What you should do: You have few options in this matter. You can make a claim on your own collision insurance and then ask the uninsured motorist to reimburse you for your deductible. If they don't agree to pay you, you can sue him to get your deductible back. If you do not have collision insurance, your only option is to ask the other driver to pay for damages. Again, if he doesn't pay you, you can take him to court.

If there are injuries involved, you can also sue the other driver to pay for your medical expenses and pain and suffering. However, some states have no-fault restrictions in which you cannot sue the other driver unless your medical expenses or pain and suffering reach a certain dollar level. (For a list of these states and their respective limits, read No-fault restrictions on pain-and-suffering lawsuits.)

Scenario No. 4
You walk out from a shopping mall and find a small dent in your car in the parking lot. Somebody hit your car and neglected to leave a note.

What you should do: If it's a small dent, you probably don't want to report it to your insurance company. Not only would you face the risk of your premium increasing, but you may have to pay a deductible that's more than what it would cost to fix your car.

Filing claims on several minor accidents may result in a premium increase. So if it costs $600 to fix your dent, and your policy has a $500 deductible, you might be wise to fix the dent out of your own pocket, rather than risk filing another claim and seeing your premiums go up. See When to file that auto insurance claim.

However, if it's a large dent and the cost to repair it is significantly more than your deductible, you may want to file a claim with your insurer under your collision coverage. If you don't have collision coverage, you'll have to pay for the repair yourself. Also, if you live in a state where you can purchase uninsured motorist property damage insurance, you can make a claim on that coverage. (For a list of these states, read How to buy uninsured motorist property-damage coverage.)

Scenario No. 5
You are carpooling with four other people in your car. Another driver crashes into the rear of your vehicle and is found at fault. The at-fault driver is carrying only the minimum bodily injury liability insurance. One of your passenger's medical expenses exceeds the at-fault party's coverage by $20,000.

What you should do: Most states require that you carry Personal Injury Protection (PIP), which is coverage that pays for medical bills, lost wages, or pain and suffering that you or any of your passengers incur from an accident in your car, regardless of who's at fault. (For a list of states that require PIP, read Do you need MedPay coverage?) After the at-fault party's liability coverage has been exhausted, your PIP coverage would kick in and pay for the rest of the damages.

If your PIP money is exhausted and the medical bills remain, your passenger can sue the other driver for the rest of the damages. You, as the driver carrying the passengers, are not on the hook for any of the liability because you are not at fault in the accident.

Scenario No. 6
You are hit by a motorist who is clearly at fault. He offers to pay for the damage in cash rather than make a claim on his auto insurance.

What you should do: If you are injured or if you even have a hint of being injured, this is a bad idea. Never take a cash settlement on the spot. You don't know how expensive your injuries may turn out to be.

If you are injured, your PIP will pay for your medical expenses and any lost wages that you may incur. Once your PIP is exhausted, your health insurance will kick in and pay for the rest of your expenses. If you do not have PIP or health insurance, you can sue the other driver to pay for your medical bills, pain and suffering, and any lost wages as a result of the crash.

If you choose to accept the other driver's cash offer for the physical damage to your car, never take money on the spot. Make sure you know exactly how much it will cost to repair your vehicle. If you don't get an accurate estimate, you could end up paying for a portion of the repairs yourself. For example, if the other driver offers you $1,000 to pay for damages and you later receive an estimate showing that it will cost you $1,500 to repair your car, you may have to kick in $500 of your own money.

Also, carefully examine any documents you may be required to sign that absolve the other driver of any further liability. If the other driver has consulted an attorney, it is likely that the attorney has drafted a document that will take away your right to sue later. If you are uncertain about signing the document, consult an attorney. Of course, hiring a lawyer is an expense that you'll have to pay for.

Even if you plan to accept the other driver's cash offer, follow the same steps as you would with any accident, which include exchanging insurance information with the other driver and filing a police report. That way you can still file a claim with your insurance company if the other driver reneges on the deal and refuses to pay you. Your insurance company will pay for the damages, but you can still sue the other driver to get your deductible back. (Keep in mind that most auto insurance policies have a statute of limitations for reporting accidents, so check your policy language for details.)