Money For Lunch – 5 Biggest Expenses After Having a Car Accident

5 Biggest Expenses After Having a Car Accident

March 7, 2018 2:09 PM0 commentsViews: 32

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According to the Annual Global Road Crash Statistics report by the Association for Safe International Road Travel, nearly 1.3 million people lose their lives in road crashes every year, and the additional 20-50 million people are left injured or disabled. Road traffic crashes are the ninth leading cause of death on a global scale, and they are predicted to climb to the fifth place by 2030 if no proper action is taken.

Car accidents cost $518 billion globally, the amount of money that certainly is huge but still pales in comparison to all the lives that are lost and the pain and suffering of their families and loved ones. However, even a minor car accident where no one is seriously injured can lead to major financial expenses that tend to be much higher than usually expected.

If you have never been in any kind of motor vehicle accident, you should consider yourself very lucky. However, even if you are an impeccable driver and never let anything distract you while behind the wheel, you may end up having a car accident because of a reckless driver or perhaps a terrible weather.

You should be aware of all the costs that come with a car accident, so that you can be fully prepared if you even get in one. Here are the five biggest expenses after having a car accident.

Higher Insurance Premiums

 The first obvious expense after a car accident has to do with your insurance. If you get in a car accident, your car insurance premiums may significantly increase, with a strong emphasis on “may”. This is because many insurance providers don’t actually tend to increase insurance premiums astronomically after a car accident, especially if the driver’s driving record is impeccable.

However, you must be prepared for a worst-case scenario of increasing an insurance premium by 20-40% of your base rate. This is how much a car insurance can increase after making just one claim.

Repairing Your Car

 The second obvious expense after a car accident involves, of course, a car repair. If you have car insurance and a proper collision coverage, then your insurance provider would cover all the costs of repairing your car. However, if you don’t have car insurance, you would need to pay for all the repairs on your own which, depending on the damage, can be pretty expensive.

Covering Your Medical Expenses

 Medical expenses after a car accident can be pretty high, especially if you don’t have any type of health insurance and a proper coverage for medical claims after a car accident. Therefore, be sure to get a medical payments coverage as soon as you can, as it can save you thousands of dollars.

With that coverage, if you have been injured and need medical attention, you can get compensation for all your medical expenses from your car insurance provider or the other driver’s car insurance provider, depending on who was the at-fault driver in the first place.

 Getting a Rental

 If your car ends up requiring extensive repairs and needs to be kept in a car repair shop for a while, you may need to get a rental to be able to go to work and run the necessary errands. If you have a rental car coverage (rental reimbursement), your car insurance provider will pay for the rental, so you should make sure you get that coverage in advance, just in case.

Of course, there are much cheaper alternatives to getting a rental, such as carpooling to work and using public transportation, or perhaps even riding a bike.

 Paying off Your Car Loan

 This expense obviously applies only if you have taken a bank loan to purchase your car. If you have, then damaging your car in a car accident would not stop you from paying off the loan, even if the car is totaled. Your lender will not take into consideration the fact that you had a car accident, because all they want is for you to pay back the money you borrowed.

This is why you should get a GAP insurance coverage, which is a type of coverage that can help you cover the difference between the actual cash value (ACV) of your car and the amount of money you still owe to your lender for the car loan.

 However, your car insurer will cover your car’s ACV if the car is totaled. One of the most common questions regarding this issue is: is car totaled if airbags deploy? The answer is: it depends. They do usually deploy in a major accident, but they are known to do the same in a minor one, where your vehicle is not totaled.

You should seriously consider all these expenses and follow the aforementioned tips as soon as you can, since that way you will be fully prepared for any unexpected circumstances and protect your financial future from any troubles.

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