If the car in front of you at a stoplight "kisses" your bumper or you tap a car in the grocery store parking lot, it may be tempting to settle the accident without involving the police or insurance companies.
Even a few minor incidents over a few years can cause a driver's auto insurance rates to rise. To avoid an increase in auto insurance premiums, drivers may attempt to settle minor claims on their own.
While this option appears to save everyone time and money (at least for the person at fault), experts warn that settling without a police report or an insurance claim could be a risky move for the motorists involved.
You may not need to call the cops if you are in a minor car accident and the other driver does not flee the scene. If either driver was injured, a police officer should be contacted so that a report can be filed. If either vehicle is damaged beyond the point where it can be driven safely, you should definitely file a police report. If either driver later decides to sue, a police report can help you fight your claim if you believe you are not at fault.
It is best to contact your car insurance company whenever an accident occurs involving your vehicle and another driver. It is especially critical to contact them if either driver was injured or if either vehicle sustained damage that rendered it inoperable. However, if you are confident that the damages can be resolved without the assistance of a third party, you may be willing to take that risk in order to avoid raising your insurance rates if you are at fault.
A police report is useful because it is generated by a third party and can be used as official documentation of the accident. The report typically includes the date, time, and location of the accident, as well as vehicle damage, injuries to motorists, and any witnesses. It may also include statements from the drivers and witnesses.
"The police report may not be admissible in court, but it may keep important information hidden," says Chris Pyles, an attorney at Sulloway & Hollis in New Hampshire. "One risk of failing to file a police report is losing information that could otherwise be used to refute a later claim."
According to Richard Console Jr., a partner at Console & Hollawell, a New Jersey law firm, if anyone is injured in the accident, calling the police and filing an insurance claim are highly recommended. According to Console, it is possible to sustain injuries but not realize it right away.
Suddenly, a minor problem that appeared to be resolved with a handshake becomes a much more expensive and complicated issue, complete with medical bills and physical therapy.
If you do not file a report, you may be faced with expensive medical bills if the person at fault "forgets" what happened or does not answer the phone when you call to arrange payment. If you are at fault in the accident and do not file a report, the other driver may be an opportunist who decides to fabricate an injury in order to dupe you into paying bogus medical bills.
According to Pyles, fender-benders between family and friends are less of a concern because both parties likely know and trust each other. Even if you collide with a friend or relative, you should still file a police report in case you need to file an insurance claim for injuries later on.
If you still decide not to call the cops, making detailed notes for future reference may be beneficial. Console advises putting everything (who, what, where, when, who was at fault, and what the other driver says he'll pay for) in writing and having it signed by all parties involved so that there is some documentation.
"People's memories become foggy with time," Console says, "and some people actually change their stories."
If you're at fault, Los Angeles attorney Jeffrey Shane advises getting a notarized release stating that you've paid for everything you agreed to cover. According to Shane, the release should show that you've paid every penny for all injuries and damages, that you've made all payments, and that no lawsuit will be filed.
If the other driver is at fault, you should give him the same type of release. If he doesn't pay or leaves town, you can usually sue the at-fault driver up to the statute of limitations in your state, according to Console. In New Jersey and Pennsylvania, for example, you have up to two years after an accident to sue.
"However, without a police report or a timely reported claim to insurance," Console says, "resolving a claim can be far more difficult and very expensive."
The longer it takes, the more difficult it will be to get the other driver to pay.
"I've seen many cases where there is little property damage and no injury report at the scene, so the parties simply exchange information and drive away," Pyles says. "Two years later, one driver sues the other, and there is no documentation reporting the minor damage or injury."
Even if you reach an agreement with the driver who hit you, leaving your insurance company out of the equation could land you in hot water. Failure to notify your insurer about an auto accident may be a violation of the terms and conditions of your auto insurance policy, which could result in a denial of coverage, according to Pyles.