If you’re wondering what the protocol is around canceling a car insurance claim after filing one, you’re not alone. The claims process can be time consuming, and it’s common to wonder whether you need to go through it at all, especially if the damage is minor.
Once you file a claim, your insurance company reviews the damage and the circumstances to determine reimbursement. At the end of this assessment, you may realize that the cost to repair is less than the deductible and wonder: is it too late to cancel? Keep reading to learn more.
Is it possible to cancel a car insurance claim?
You can cancel an insurance claim, however, it may depend how far along you are in the process and who else is involved. There are many reasons why someone would opt to cancel a claim. The most common one is finding out that the deductible is around the same amount as the damages, so repairing it yourself may make more sense.
Here are some other things that may impact whether or not you can cancel a claim:
Your policy terms
Some polices obligate you to disclose any accident to your insurer. You don’t have to make a claim, but you must let your insurer know. This is important if you’re in an accident involving another party. If the other party reports the accident, your insurance company is likely to find out. Having the accident recorded in the system may help you. Always read the fine print and ask your insurance advisor any questions you have to know where you stand.
If you are the at-fault driver of an accident
If you are at-fault, the claim must stay opened until it’s fully resolved with the other party. This may be a lengthy process, especially if the other side reported injuries and is seeking medical treatment. While you may be able to cancel the claim to repair your damaged car, it will still have to remain open until the other individual has recovered from personal injury.
Filing an insurance claim
Filing a claim may seem scary. At BrokerLink, we always encourage customers to contact us before filing a claim if possible, so that we can explain your policy terms; how filing a claim may impact your rates and we can provide additional guidance. The value a broker provides is that we can give you a professional opinion before getting your insurance company involved, and you can ask us your questions with peace of mind.
Here are a few important tips to know when starting this process:
- Have all the important and relevant information about the accident
- Review your car insurance policy as the insurance company will pay for the specific damages/losses outlined
- Check your insurance polices for the following terms and conditions:
- Any exclusions, losses or events that are not covered
- The specific process that you must follow in the event of a claim
- Any time limits for how long you have to submit your claim
- Your ability to cancel a claim and if there are timelines associated to it
Before filing a home or car insurance claim, consider your options:
- By making a claim, your premiums may increase in the future or when you renew your policy.
- Switching insurance providers will not remove a claim as it’s kept on your file for a number of years.
- Some insurance companies provide discounts to customers who are claims-free, so you may keep this discount by maintaining this status.
- If your claim is around the same cost as your deductible, you’ll have to decide whether it’s worth it to go through insurance or just pay for the loss yourself. If your deductible is $1,000 and the claims is $1,100, insurance will reimburse you for $100. However, in the long term you may pay more than that in premium increases.
If you decide to make a claim, here are some steps that will help:
- Contact your insurance brokerage as soon as possible, to prepare to file the claim.
- Many insurance companies have time limits within which you must submit your claim, so check your terms and conditions for your policy time limit.
- Provide your brokerage with all supporting documents as required. These may include an accident report (auto claim), a death certificate (life insurance claim), photos etc.
Once a claim is submitted, your insurance company will review your policy and let you know if the claim is valid under the terms of your contract. In some cases, the insurance company may look into your claim to ensure there is no fraudulent activity taking place. During a claim investigation, your insurance company may ask you to provide:
- Any medical records
- Police reports
- Other applicable information to verify your loss
From there, your insurance company will use that information to determine if your claim will be paid out.
Reasons why people cancel their insurance claims
There are several common reasons why people decide to cancel a claim:
The deductible is high
If the deductible costs more than the damage itself, it doesn’t make sense to pursue a claim. However, sometimes you don’t know the repair costs until after you file a claim.
You cannot pay the deductible
Paying the deductible is often a requirement that many insurance companies have before they issue a full payout for the rest of your claim. If you don’t have enough money set aside for this cost, one option is to cancel the claim and deal with the damages sometime in the future.
The claims process can be stressful and time-consuming
Some claims move forward with ease, others may go back and forth. Whether you have multiple conversations with your loss adjuster, or there are several people or insurance companies involved trying to come up with a mutual agreement, it can be long and drawn out. This may make some people want to cancel their claim, however, you may not be able to as time goes on.
Is there a record of my insurance claim after I cancel?
Cancelling a claim does not remove the incident from your record. Insurance companies will still have a claim logged within their database, even if your cancelled claim resulted in zero payout, as you had a reason to file in the first place. Many insurance companies will not raise your rates for cancelling a claim, but it stays on your file.
Before making a claim, customers are encouraged to contact their licensed insurance broker who will review your policy and provide guidance, including: insights into you deductible, how a claim may impact you in the future and more. Insurance brokers are licensed experts who can walk you through your options so you can decide what works best for you before getting insurance companies involved.
FAQs on cancelling an insurance claim
Who is considered a high-risk driver?
An insurance company considers high-risk drivers to be more likely to get into an accident or cause damage. This may be based on an investigation into their driving history, it may also be based on age, for example, new or young drivers are considered high-risk drivers.
What if I’m in an accident and I contact the insurance company before my broker?
Depending on the nature and location of the accident, it may not always be possible to contact your broker before contacting the insurance company to report the accident. This is ok – just be sure to contact your broker at your earliest opportunity.
How long does the insurance claims process take?
The time it takes to file and process a claim varies depending on the damage and the number of people involved. The more parties involved may result in more back and forth with other insurance companies, which can prolong the settlement process.