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Before you hire an attorney: Understanding the Claims Process

hire-personal-injury-lawyer_410x293If you’ve been involved in an auto accident and need to file an insurance claim, this guide will show you what to expect and help you understand how the claims process works.

In the unfortunate event that you are involved in an auto accident involving injury or property damage, you will be required to file a claim with your insurance company.

The information provided below is designed to take you step by step through the claims settlement process.

This guide is not a legal document and does not in any way modify or replace your insurance policy. For more information about your unique situation, speak to a personal injury lawyer.

What’s In This Guide

Report the Accident to Your Insurance Company

When you are involved in a car accident involving injury or property damage, you need to report it to your insurance company within seven days, regardless of who is at fault.

If you are unable to report the accident within seven days, report it as soon as possible after that. If you don’t report your accident within a reasonable amount of time, your insurance company may not have to honor your claim.

Have the Facts in Hand!

Your insurance agent will likely ask you to supply some basic information. To help speed things up, try to have the following information with you when you call:

  • the name of the registered owner’s insurance company and his/her auto insurance policy number;
  • the make, model, year, registration and licence plate number of the vehicle; and
  • details regarding the accident, including:
    • the driver’s name and driver’s licence number (if the driver is not the registered owner);
    • the date, time and location of the accident,
    • the extent of any injuries;
    • the number of passengers involved, if any;
    • the extent of damage to the vehicle;
    • your description of the accident;
    • the names and driver’s licence numbers of the other drivers, as well as the names of their insurance companies and their auto insurance policy numbers;
    • the licence plate and vehicle identification numbers of the other vehicles; and
    • the name and badge number of the investigating police officer, if the accident was reported to the police.

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Read Your Policy

It’s a good idea to sit down and thoroughly read your insurance policy. It provides specific details about your insurance coverages, your rights and your responsibilities under the contract.

If you do not have a copy of your policy, ask your insurance agent for a copy.

The claims process will be easier to understand if you know the details of your coverage and your responsibilities.

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What Happens After You File a Claim?

Once your claim is reported, you will be contacted by the claims adjuster assigned to your file.

In some cases the adjuster will want to meet with you in person; in other cases the entire claim will be handled over the phone.

Your claims adjuster will determine the extent to which the claim is covered by your insurance policy, explain the coverages provided by your policy, and help guide you through the entire claims process. In most cases you should have a car accident attorney on your side to help you with this process.

If you have any questions or if there is something about your policy or claim that you don’t understand, ask your claims adjuster for clarification.

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How Does Your Insurance Company Assess Fault?

Someone is always determined to be at-fault in an auto accident, whether partially or fully.

Insurance companies must determine the degree of fault to be assigned to each driver for purposes of determining which property damage coverages apply to the accident, and to ensure that the premiums of the driver who was more than 25 per cent at-fault are adjusted appropriately.

Insurance adjuster will attempt to determine who is at fault based on evidence that is provided of the incident. If fault cannot be determined the case may be taken to court to be assessed by a judge.

How Do Police Charges or Convictions Affect Your Insurance Company’s Decision?

If you are charged with an offence, you will not necessarily be found at fault for insurance purposes.

Similarly, if the police don’t file charges, it doesn’t necessarily mean that the insurance companies investigating the circumstances of the accident will not find one or more of the drivers involved at fault. For example, if a vehicle was unable to stop on an icy road and rear-ended another, a police officer may say that neither of the drivers was at-fault. Such a comment relates to the laying of charges and should not be taken as an opinion about as to who is at fault for insurance purposes. In a case like this, the insurer would state that a vehicle which rear-ends another is at-fault. On the other hand, with certain types of charges, the fault will instead be determined according to the ordinary rules of negligence law.

Can Fault in an Auto Accident Be Shared?

Yes. The circumstances of an accident may show that more than one driver was partially at fault for insurance purposes.

How Does an At-Fault Accident Affect Me?

A driver can be anywhere between 100 per cent and zero per cent at fault. Any driver who is more than zero per cent at fault will have an at-fault accident on his or her insurance record.

If you are found more than 25 per cent at-fault for the accident, it is more than likely that your premium will go up on renewal.

To confirm how your rates will be affected, check with your insurance agent.

Note: When you lend your vehicle to someone, you are also lending him or her your insurance. If the individual you lent your vehicle to has an accident and is found to be more than 25 per cent at-fault while using your vehicle, the accident will go on your insurance record, and your auto insurance premium will go up.

What Can You Do If You Disagree with Your Insurance Company’s Assessment of Fault?

If you are dissatisfied with your insurance company’s decision on fault, and believe that the decision does not accurately reflect the circumstances of the accident, it may be time to speak to a car accident attorney.

Bring any new information to the attention of your insurance company. Generally, an insurance company will revise or reconsider its decision on fault only if additional, relevant information is provided. For example, if an accident occurred in which each driver stated that the other driver had gone through a red light, an insurance company would have little choice but to assign fifty-fifty fault. However, if an eyewitness confirmed which driver went through the red light, an insurance company could review its decision.

If your insurance company refuses to revise its decision and you still disagree, contact your car accident lawyer.

Refer to the section in this guide entitled “If You Have a Complaint” for more information on how to file a complaint with your insurance company.

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What to Expect If Your Vehicle Has Been Damaged

The amount you receive for your damage claim will depend on the extent to which you are at fault for the damage, as well as the type of coverages you purchased.

Speak to your claims adjuster or your car accident lawyer if you have one regarding your specific situation. They will be able to outline the precise coverages that are available to you, as well as any deductibles that may apply.

Does Your Insurance Company Have to Provide You with a Rental Vehicle?

It depends. It’s best to ask your claims adjuster if you’re covered before renting a replacement vehicle.

If the other driver’s insurance company accepts complete fault for the accident, you will be entitled to a replacement vehicle (for a reasonable length of time) while your vehicle is being repaired.

However, if you are found to be partially or completely at-fault for the accident, and did not purchase optional Loss of Use (Transportation Replacement) Coverage, the cost of a rental vehicle may not be fully covered.

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How Does Your Insurance Company Decide Whether to Repair Your Vehicle or Declare It a Total Loss

When you make a claim for damages to your vehicle, your insurance company will pay the lower of the following:

  • the cost to repair the loss or damage, or
  • the “actual cash value” of your vehicle at the time it was damaged.

“Actual Cash Value” (ACV) = The amount necessary to replace your vehicle with a comparable used vehicle. (The total mileage, age, overall condition and average retail selling price of your vehicle will all be considered in determining its actual cash value.) + applicable sales tax, title, and registration fees

Note: If you’ve recently completed work on your vehicle that you think would increase its actual cash value, tell your claims adjuster. He or she may ask you to provide receipts to help the insurance company determine your cash settlement.

Recognize that repairs needed to maintain your vehicle in good running order may not increase the actual cash value of your vehicle.

Your insurance company will not pay more to repair your vehicle than its actual cash value at the time it was damaged, less the deductible specified on your Certificate of Insurance.

Your insurance company will likely decide to treat your vehicle as a total loss and offer you a cash settlement if the necessary repairs would cost more than the actual cash value of the vehicle. In most cases, it will be your responsibility to purchase a replacement vehicle.

Note: An exception to the above would be if you purchased a waiver of depreciation endorsement. This can be added to your auto insurance policy for a new vehicle; it is not generally available on used vehicles. The period of coverage is usually between 2 to 5 years.  This optional endorsement ensures that in the event your new vehicle is written off, you will be reimbursed for the total list price of the new vehicle and not the depreciated value. Consumers purchasing a new vehicle should consult their insurance representative on the coverage choices available.

What Can You Do If You Haven’t Been Offered a Fair Cash Settlement?

Do your homework. Check local newspaper classified ads and “auto trader” magazines to find the asking price for similar vehicles. Although these are asking prices, not the selling prices, this should give you an idea as to what your vehicle may be worth. Write down the prices of five vehicles similar to yours and then take the average. If this average is significantly higher than the cash settlement being offered to you by your insurance company, speak to your claims adjuster.

If you still disagree over the value of the vehicle, or its contents, or the nature, amount or cost of any repairs, you will need to speak to a car accident attorney.

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Getting Your Vehicle Repaired

Selecting a Repair Shop

As long as your insurance company approves the estimate, you may have your vehicle repaired at the repair shop of your choice.

Your insurance company may suggest you bring your vehicle to one of their “preferred” body shops. You may find using one of their “preferred” shops easier, because it puts the onus on your insurance company to make sure that the work is done satisfactorily.

“Betterment” charges may apply if the repairs to your vehicle make it significantly better than it was before the accident!

It is your insurance company’s obligation to return your vehicle to its pre-accident/loss condition.

When repairs made to your vehicle end up giving you a vehicle in better condition than you had before the accident, the difference is known as “betterment.” Since the premise of insurance does not allow the insured to profit or “better” from his or her loss, your insurance company has the right to ask you to contribute towards this betterment.

For example, if a rusty door panel that had been in a collision were to be replaced with one that is not rusty, you may be expected to contribute financially towards the betterment of the vehicle.

For more information regarding your specific situation, speak to the claims adjuster handling your file.

Does your insurance company have the right to replace parts in your vehicle with used parts when it is being repaired?

As stated in your insurance policy, your insurance company has the right to repair, rebuild, or replace any damaged parts with other parts “of like kind and quality.” This means that if you damage the front fender of your five-year-old vehicle, your insurer can replace the damaged fender with a used one of like kind and quality as the original.

If your vehicle is less than a year old, your insurance company will likely use new Original Equipment Manufacturer (OEM) parts to replace any damaged parts.

Regardless of the age of your vehicle, most insurance companies will replace damaged safety-related parts with new ones. For example, your insurance should replace a deployed air bag with new OEM air bag replacement parts.

What are “aftermarket” replacement parts?

Your insurance company may also use “aftermarket” replacement parts approved by the Certified Automobile Parts Association (CAPA) that meet or exceed Original Equipment Manufacturer specifications.

Aftermarket parts are overruns from makers of original parts or from manufacturers who specialize in replacement vehicle parts.

Note: Your insurance company will not cover the following repairs unless they result from a peril for which you are covered or are required by fire, theft, or vandalism and your policy covers these perils:

  • tires;
  • consisting of, or caused by, mechanical breakdown of any part of the vehicle; or
  • consisting of, or caused by rusting, corrosion, wear and tear, freezing, or explosion within the engine.

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You May Be Responsible for Paying Certain Deductibles

When you file a claim for damage or loss, the payment made by the insurance company may be subject to a deductible, or the amount of the claim you will be responsible for paying yourself.

You can expect to pay your full deductible unless the accident was not your fault or was only partially your fault.

Take the following example:

You are involved in an accident. Your vehicle’s actual cash value is determined to be $12,000. To repair your vehicle, it would cost $7,000. Since the necessary repairs cost less than the actual cash value of your vehicle, your insurance company decides to repair your vehicle rather than declare it a total loss.

If you are 100 per cent at-fault for the accident, the cost of repairing your vehicle will not be covered under your Direct Compensation – Property Damage Coverage. But if you purchased the optional Collision or Upset Coverage with a $500 deductible, your insurance company will pay $6,500 towards repairing your vehicle ($7,000 less your $500 deductible). This means you will be responsible for paying your $500 Collision or Upset deductible.

On the other hand, if the other driver can be identified, is insured, and is found to be totally at-fault for the accident, your insurance company will cover the total cost of repairing your vehicle ($7,000) as long as your deductible is zero dollars.

Speak to your claims adjuster about your specific situation.

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What to Expect If You’ve Been Injured

If you are injured in an auto accident, you may be entitled to the following accident benefits:

  • Income Replacement: This benefit compensates you for lost income.
  • Non-earner: This benefit provides compensation if you are completely unable to carry on a normal life and do not qualify for an Income Replacement or Caregiver benefit.
  • Caregiver: If you qualify for this benefit, it provides compensation for some expenses incurred when you cannot continue as the main caregiver for a member of your home who is in need of care.
  • Medical: This benefit pays for medical expenses incurred when you are injured.
  • Rehabilitation: This benefit pays for rehabilitation expenses incurred when you are injured.
  • Attendant Care: This benefit compensates you for some of the expense of an aide or attendant.
  • Compensation for Other Expenses: These benefits pay for some other expenses such as the cost of family visiting you during treatment or recovery. It may also pay for some housekeeping and home maintenance, the repair or replacement of some items lost or damaged in the accident, and some lost educational expenses.
  • Death: This benefit pays money to members of your family.
  • Funeral: This benefit pays for some funeral expenses.

A full description of the accident benefits that may be available to you can be found in your insurance policy.

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Applying For Accident Benefits

When applying for accident benefits, ask your claims adjuster to outline the procedures you must follow. For your peace of mind it is best that you leave this up to your car accident lawyer.

Once your insurance company has received and reviewed your Accident Benefits claim, it will inform you in writing of which accident benefits you can expect to receive and which portions of your claim, if any, the company is not prepared to pay for.

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If You Don’t Have Your Own Auto Insurance

If you don’t have your own auto insurance or are not listed on someone else’s policy, but have been injured in an auto accident, you can still make a claim for accident benefits. The circumstances will determine which insurance company is responsible for paying for the accident benefits you may be entitled to.

If you don’t own or lease a vehicle and are not listed on someone else’s policy contact a personal injury lawyer who will help you with your case. In general, the following table provides explanation as to whose insurance company will be the one to deal with in your case.

Your Situation/Circumstance
Where to Send the Application
You were driving a company vehicle. ​
The insurance company that insures the company vehicle.  ​
You were a passenger in someone else’s vehicle when injured​
The insurance company that insures the vehicle you were a passenger in. ​
You were a passenger in an uninsured vehicle and there was more than one vehicle involved in the accident.​
The insurance company of an insured vehicle involved in the accident.​
You were a pedestrian or cyclist. ​
The insurance company of the vehicle that hit you. ​
None of the above. ​
Contact your personal injury lawyer for details.

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What Can You Do If You and Your Insurance Company Disagree about Your Entitlement to Accident Benefits, or the Amount of Benefits?

Personal injury lawyers that deal specifically with car accidents are here to help consumers who are dealing with insurance companies trying to settle accident benefit claims. If you and your insurance company disagree about your entitlement to accident benefits, or the amount, the best option is to contact a car accident lawyer who will help you get a fair settlement.

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Your insurance company is allowed to deny payment of Income Replacement, Non-earner and Compensation for Other Expenses to:

  • any driver who knew, or should reasonably have known, that he or she was driving the vehicle without valid insurance;
  • any driver without a valid driver’s licence;
  • any driver who was specifically excluded from driving under your insurance policy;
  • any driver or passengers who knew, or should reasonably have known that the vehicle was driven without the owner’s consent;
  • anyone who made or knew about a material misrepresentation that induced the insurance company to provide you with auto insurance; and
  • anyone who was engaged at the time of the accident in an act for which he or she is convicted of any criminal offence, whether or not the offence is related to the operation of a vehicle.

Similarly, if you are charged with a Criminal Code offence, your insurance company is also allowed to deny you payment of the above benefits, pending the outcome of the charges.

More importantly, if you are found guilty of committing a criminal offence, your insurance company may refuse to sell you auto insurance or require you to pay significantly higher premiums for insurance in the future.

If you suspect that you may be a victim or target of a scam or fraud, you can help put an end to the scam or fraud by reporting it.

As a first step, report the matter to police.

If you want legal advice, call 1 (877) 959-3393 for a free case evaluation.

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If You Have a Complaint

If you are not satisfied with how your claim is being handled, there are steps you can take. Improved measures have been put in place to help consumers get their insurance complaints resolved more quickly. How the complaint process works varies from company to company. Your company representative (agent, broker, claims adjuster, or customer service representative) will be able to provide you with specific information about the procedures to follow should you have a complaint.

In addition, each company has a Consumer Complaint Officer who oversees the complaint-handling process. The Consumer Complaint Officer is an employee of your insurance company responsible for ensuring that your complaint is addressed. If you are unable to obtain information about the protocol from your company representative, or if you are having difficulty obtaining a response outlining your company’s position, then you should contact your company’s Consumer Complaint Officer.

If you are unable to resolve your complaint with your insurance company, your company is obligated to provide you with a letter stating its final position on your complaint. The company’s Consumer Complaint Officer will ensure that you receive a letter stating the company’s final position, as well as providing you with the name and details of an independent Ombudsman organization that can review the complaint if you still do not agree with the company’s final position.

If you decide to write to the independent Ombudsman organization referred to in your company’s final position letter, make sure to describe your complaint and why you disagree with the company’s position. Remember to include your company’s letter and any documentation that relates to your complaint.

Upon receipt of your unresolved complaint, a Complaint Officer at the independent Ombudsman organization will review and respond to your complaint.

In all other cases it is best that you speak with a personal injury lawyer. You can find the numbers below that you can call for a free case evaluation, there’s no obligation to sign up.

Free Case Evaluation 877-959-3393 or Submit your case details