The Cost of a Car Accident: How Safe Driving Leads to Saving Money
Posted by Guest on Nov 7, 2012 in Saving Money | 29 comments
The following is a guest post
Few things can ruin your day quite like a car accident. They make you late for wherever you were headed, they can take your vehicle out of commission for a while and, if you’re found at fault, they can be very expensive. So what are the costs associated with a car accident, and how much can safe drivers save by preventing fender-benders?
Insurance deductibles
In most states, if you’re in a car accident and found to be at fault, you and/or your automotive insurance company are responsible for any resulting damages. So the best-case scenario is that you’ll pay an insurance deductible and your insurance provider will cover the rest. A common insurance deductible is $500, which is not a minor expense for most people. A minimum deductible of around $500 is usually required for a financed or leased vehicle, but to keep your premium low, the deductible could be $1,000 or even more. That’s a lot of money to be saved by staying safe on the road.
Out-of-pocket expenses
Many car accidents are minor and don’t require an insurance claim. For example, if you back into a parking spot, misjudge the distance and hit a light pole, the resulting damage may not warrant filing a claim. For these scrapes and scratches, the cost of repairs will usually come out of your pocket—and they can add up. A car bumper may seem like a minor, inexpensive car part, but ordering a new one, paying to have it painted the matching color, and the cost of installation can total up to $1,000. So even minor accidents can put a dent in your savings account.
Insurance rate increases
Your insurance premium is determined by several factors, and one of those factors is your driving history. Being involved in a car accident, or even being cited for a traffic violation that didn’t lead to an accident, can increase your insurance premium. Increased insurance rates are one of the invisible expenses associated with car accidents, but they’re also one of the expenses that you have some control over. If you suspect that you’re paying too much for car insurance, especially after a car accident, compare automobile insurance quotes from a few providers
These are just a few of the costs associated with getting in a car accident. Other expenses include medical costs following an injury, and out-of-pocket expenses for damage that wasn’t covered by your insurance plan. Saving money is just one more reason to stay safe behind the wheel.
Sponsored content was created and provided by Nationwide Insurance.
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Thankfully I haven’t been in a car accident, but even if you drive safe you can still get unlucky and end up in an accident. I don’t think people really think about the costs involved because they don’t want to think about getting in the accident in the first place!
DC @ Young Adult Money recently posted..Giveaway: iPad Mini + iPad Mini Case + $100
Good point, DC. Who in the world wants to expect and prepare for the worst?
I’ve only been in one accident. It was when I was first driving and was driving in a pretty nasty snow storm. I agree that costs can be more than expected and is just another reason to pay attention and drive smart while on the road.
John S @ Frugal Rules recently posted..A Smart Way to Play Interior Designer When Moving
I bet if we all got into our cars thinking about the costs of potentially getting into an accident, we’d all drive safer!
Don’t forget that even if you’re in a car accident that’s not your fault, it’s easy to have more than one deductible. I was rear-ended and had a collision deductible, as well as a medical deductible. We had Med Pay coverage, so the medical deductible ended up being covered by that, but it’s not a standard coverage by any means.
Mrs. Pop @ Planting Our Pennies recently posted..IRS Double Standard – How Much Is Hair Worth?
So true, Mrs. P. I was actually hit by someone who was drunk or high (or crazy?) and she had no coverage! That’s against the law, and she got in trouble for it…but paying for my car? Oh, that’s my responsibility because I was the only covered driver in the accident! Sucks to be responsible, doesn’t it?
As someone who was in a major car accident in 2011, I can speak on the importance of having good insurance. I was pregnant when I was rear ended. Luckily, our baby was fine. Unfortunately, I got my two front teeth knocked out!!! Porcelain veneers and 17K in dental work later, I am so glad that I had insurance.
Holly@ClubThrifty recently posted..Craigslist: Great Way to Sell your Crap or Total Pain in the Ass?
Hot damn, Holly! 17k in dental work? You better have a knockout smile now (stupid pun completely intentional…)
I know a lot of people who file a claim for everything – even minor damage like your light pole example – and then they complain when the premium rises.. they get a small reprieve by switching companies, but I have to believe that eventually they will run out of companies or those companies will see the trend..
Joe Morgan recently posted..Why Buy Here, Pay Here Car Lots Are A Scam.
I think people are clueless about these things, Joe. It’s sad how little people understand about insurance. First, you have to pay the deductible every time, and second…you could get dropped or your premium could skyrocket if you happen to have a low deductible and take advantage of it, filing claims left and right.
Honestly, that is one big reason I’m glad I don’t have a car! I can’t get in a car accident without one (or at least it won’t be my car that gets damaged)!
Mo’ Money Mo’ Houses recently posted..Happy Humpday and an iPad Mini Giveaway!
Good Point! If I lived in a city instead of a smaller town, I would definitely go without a car. I love the idea of this lifestyle.
Jason Clayton | frugal habits recently posted..Why are some People Successful and others Not?
We live in the burbs, so we absolutely have to have a car. There are small pockets around our biggest metro area here in which bike-riders and pedestrians fare better. That would be pretty cool…it would be hard with 3 kids, though…
Not driving like an idiot can really save you money. It’s amazing how many reckless drivers out there get ticketed by the police and blame it on the police when it was their fault in the first place. If they drove more responsibly the cop wouldn’t have pulled them over in the first place.
justin@thefrugalpath recently posted..Your Small Business Needs an Emergency Fund Too
I don’t get the hate for cops personally. Of course, I follow the rules of the road, so no wonder I only have love for the police! I see police as there to help me, not ruin my day.
A car accident can really cost you a lot of money, so we should do our best to keep safe while driving since it is not very easy to shell out a lot of money, not to mention the physical inconvenience it could have on you and other people. I just don’t understand why there are still a lot of reckless drivers around us despite the fact that they knew the consequences of their actions.
My Multiple Incomes recently posted..Comment on How Much Should You Spend on a House? by Thomas S. Moore
I was in an accident 11 years ago in which this young guy was racing his friend, spun out of control and hit me and my then 8-month-old baby head on. We are lucky to be alive! Thankfully, he was insured, but it still ended up costing us in physical damages. My neck was so messed up that I don’t think it will ever be the same. I would need a huge settlement to pay for all the chiropractic care I NEED, but don’t get. Still, I don’t look back in anger. I look at it that I was lucky that I had my seat belt on, my son’s carseat was installed correctly, and that we were in a safe vehicle with a steel cage.
In 2009, i got into a small fender bender. Nobody was hurt, but it was my fault as I cut a driver off. My insurance deductible has sky-rocketed. Now I pay over $300/month for car insurance.
Daisy recently posted..What I Bought This Week
That’s a pretty penny, Daisy. I bet you are the most defensive, safest driver ever now!
The cost of my insurance here in Tampa, Florida is about $100 more than that of my sisters living in Boston. Since I’ve started driving down here I can understand why though- too many old people who don’t know how to drive, and about 50% of the people I pass on the road are talking on their cell phones while failing to use their directional! Its frustrating but I definitely understand why it has to be so high. I got in an accident my Freshman year of college and the medical bills for simply going to the ER to check if everything was okay were crazy!
Kelly@Financial-Lessons recently posted..6 Investing Tips for Beginners
I didn’t know Florida was so expensive for insurance, Kelly. I know that there are a lot more retired adults in Fl…do you think that is why? Also, there’s a beach! Where there’s a beach, there’s people partying! Interesting…wonder what the real reason is.
Getting in a car accident can really put a dent in your wallet. Even if you are covered by insurance, paying a insurance deductible of $500 – $1000 is no joke. I believe that driving smart & also having a well-maintained car could help minimize road accidents.
Dominique Brown recently posted..5 Important Things You Should Know about Credit Card Consolidation
I don’t know many people who would sneeze at $500, true. I think that having a well-maintained vehicle is imperative. Of course, even if you are perfect and take wonderful care of your car, someone could hit you. I guess we just have to be responsible for ourselves and take care of our own vehicles…then hope they’re insured!
Thanks for this great post. Be a secured driver anywhere you go. Protect yourself from any kind of liability with full coverage auto insurance
freddrake16 @Short term car insurance recently posted..Important Auto Insurance Q & A’s
It’s not just accidents themselves that end up costing you but general speeding as well. For those that like to speed, getting caught a couple times can lead to drastically higher insurance costs. There’s a reason why a car with a more powerful engine costs more to insure. The driver is more likely to speed or get into an accident.
For some reason I never felt the “need for speed” when driving our Toyota Corolla!
i hav been a victim of a major accident for once in my life…on that day i understood the importance of having an auto insurance
A very good post… it gives relevant knowledge about vehicle insurance…really helpful post
Cheap full coverage insurance quotes recently posted..Accident Benefit Funds
A very good post… it provide best knowledge regarding vehicle insurance and its importance… really helpful post
Cheap full coverage insurance quotes recently posted..Accident Benefit Funds
Safe driving not only leads to saving money but also saving your life. Responsible and safe driving lessens the risk of accident and I think that’s the most important thing to consider while on wheels.
Amy recently posted..Young driver sentenced for causing crash that killed three teens