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Worth paying $1,800 out of pocket to avoid an increase in auto insurance premiums?

I was in a fender bender recently and the estimate for the other guys' car repair is around $1700-1800. I already have an accident on my file from 1 year ago (October 2017) which made my premium go up from $600 to $900 per 3 months and I'm worried this could push it even further. Is it worth paying out of pocket or should I bring it to my insurance to cover ($500 deductible). To be honest, I repaired my car for only $100 because I am OK with cosmetic damage to the bumper, but I understand why he would want to get his bumper replaced because it is my fault, and he has a right to have it restored to the way it was before the accident.

Aug 18, 2018 San Diego, CA

Author profile picture

Ava Lynch

Senior Analyst

  • Licensed Insurance Agent — Property and Casualty

Ava joined The Zebra as a writer and licensed insurance agent in 2016. She now works as a senior analyst, providing insights and data analysis as one…

There are a few things to consider.

  1. First, most insurance companies require you to report any incident, even if a claim is not filed.
  2. Filing a claim will definitely impact your insurance rates. Check out our article on the claims process which will explain the things to consider when deciding whether to file a claim.
  3. Next, in 2020, an at-fault accident increased a driver's insurance premium by an average of 45% meaning drivers would pay $3k+ in premium increases over five years. A second at-fault accident would certainly further increase your premium. If you can afford to pay out of pocket for the damages, it can be cheaper in the long run than having your insurance rates impacted for the next five years. 
  4. However, the person you hit might not want you to pay out of pocket and would prefer to handle it through the insurance company. This is why you need to report the incident to your insurance company as soon as possible.

Also, your deductible would not be applied in this situation since you would not be having your car repaired. Your liability coverage would cover the damages to the other car. If you did file a claim to have your car repaired then your deductible for collision coverage would apply. Check out our page on what you can expect when filing a claim. Good luck and if you have any other questions, don't hesitate to ask.  

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