Although insurers have clear regulations on when their clients should report an accident, people don't always follow them. Here are two of the most common reasons motorists don't report accidents.
You Fear That Your Rates Will Hike
Insurers charge higher premiums for motorists with poor driving histories than for those with clean driving histories because the former are high-risk drivers. Many people, therefore, don't report their accidents for fear that they will be treated as high-risk drivers.
However, your rates will not always rise after an accident. In fact, some states have regulations that prohibit rate hikes after certain accidents. For example, in some states, your rates won't go up after an accident if you weren't at fault or if you file your claim under your comprehensive insurance policy. Even without a specific law prohibiting a rate hike, your premiums aren't likely to go up (or may only go up marginally) after an accident resulting in minor property damage.
Whether or not your rates may hike, however, you should report all accidents as required by your auto insurance carrier. If you don't report the accident, and the insurer later learns of it (and there are several avenues from which the insurer can get the information), your rates are almost certain to go up.
You Were Negligent At the Time of the Accident
Some people also avoid reporting accidents if they were negligent at the time of the accident. For example, you may fear involving the authorities if you were texting, driving a malfunctioning car, or driving under the influence. This may be a valid fear because your insurer may view you as a negligent and irresponsible driver if you commit a traffic violation.
However, the fact that you were negligent doesn't necessarily mean that your negligence caused the accident. For example, even if you were using the phone while driving, it's still possible that it was the other driver's mistake that led to the accident.
Besides, being negligent and contributing to an accident doesn't necessarily mean you won't be compensated. Depending on the laws of your state, you may still get your compensation as long as your contribution to the accident was less than 50%. In some cases, your compensation will be reduced in line with your percentage contribution to the crash.
Whether or not your fears are valid, you need to report your accident if your insurer demands it. Otherwise, you are only storing more problems that you will have to deal with in the future. Consult an attorney if you failed to report an accident and one of the victims has sued you.