The risks of not declaring minor car damage to insurers
Post-prang calls to insurers will probably cost, whether you’re claiming or not, says Paul Lewis.
Even if it’s only a little dent or a scratch on your car, you are obliged to tell your insurer regardless of whether you intend to claim for it. Motor insurance policies come with a rule that you must inform your insurer of any incident involving your vehicle. If you do not then you will be in breach of contract and that could cause trouble next time you do make a claim – even invalidate it.
Sadly, that call to your insurer will almost certainly put up your premium, whether you claim or not. Insurers employ statisticians called actuaries who use the data from millions of customers to work out the likelihood of an individual claiming. If you have had a bump – even just a scratch or a dent that was absolutely not your fault – then the actuaries will say you are more likely to have another and are a higher risk individual, which means they will bump up your premium.
It is also a legal obligation to exchange insurance details with the other driver if you can do so, even off the road, for example in a supermarket car park. Never agree to sort things out between you or accept cash offers to do that. Not only is that illegal, it could invalidate your claim then or in future. Even if the other driver is not insured, your claim will still be met from a special insurance industry fund. So never do a deal over a claim.
You should also ignore offers from the other driver’s insurer or a repair firm to employ an agent to manage the claim for you. These firms will try to boost your claim and make money from it themselves. Many will ask you to sign a credit agreement just in case things go wrong. Never do that. Just call your own insurer and ask their advice about dealing with the damage.
If you do not want to make a claim they will accept that, though that call will still probably put up your premium next year. Even if you change insurers your history will follow you. All insurers subscribe to the Claims and Underwriting Exchange (CUE) database, which stores all motor, home and personal injury incidents that have been reported to any insurer.
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