There’s nothing that screws up your day quite like getting into a fender bender. Last month, my wife and I were out finishing our Christmas shopping when the unexpected happened. I was driving down an aisle in the parking lot at Target when a car suddenly backed up and slammed into my right fender. There’s nothing I hate more than shopping. Especially with the crowds around Christmas time. Throw in a fender bender along with hours on the phone with insurance companies, and this did not make for my ideal day.
Luckily, the guy that backed into me had car insurance. He also admitted it was his fault. That should be obvious as it’s illogical that my right fender could have run into his bumper, but you never know when dealing with insurance companies. They make money by collecting your premiums. Not by shelling out cash for an accident that could be argued as no fault.
We spent about an hour in the parking lot to iron everything out. Besides it being about 20 degrees outside, the whole process wasn’t too bad. It definitely could have been made worse had the guy not taken responsibility. And thank god he had car insurance!
Car Repairs Are Expensive!
A few days after the accident, I received a call from the other guy’s insurance company. I had to answer a bunch of questions about the accident. Most of them were designed to get me to say something that would make it appear the accident was my fault. Questions like, how far was the car backed out of the parking space, how fast were you going, and did you see brake lights? This was a nerve racking experience. What was I going to do if they came back and said it was considered no fault and thus wouldn’t pay? A few hours later, I received a call from a different agent saying they had discussed the accident with the other person involved and had found he was 100% at fault. Phew!
His car insurance company gave me a list of approved repair shops to use to fix the damages from the accident. If I used one of their approved shops, then they pay for the repairs directly. Otherwise, I would have to pay and then submit the bill to them. I chose the path of least resistance and went with one of their preferred shops.
I selected one of the body shops near my house and took my car in to get an estimate. It’s been a while since I had to have body work done on my car. About ten years ago, I backed into my buddy’s girlfriend’s car. I don’t think there’s a worse sound than crunching metal when you know you’ve just F’d up something. It was a pretty easy fix to my bumper and didn’t cost that much. From that experience, I wasn’t expecting this repair to cost too much to fix.
From looking at the picture, how much would you have guessed these repairs would cost? $1,000? $1,500? $2,000? More? In my mind, I didn’t think it would run more than $1,500. That was a naive assumption. Take a look at the bill below.
Glad I’m not Paying!!
Over half of the bill was for labor. Hours aren’t listed here, but the original estimate had 15.2 hours at $48/hour. The final bill included almost double the labor as the original estimate. Think those labor hours were padded a bit? Plus, the total bill is more than half the value of my car. All for just a simple fender bender that didn’t impact the drivability of the car. Glad it’s not my money!
Check Your Insurance Coverage
Auto insurance coverage requirements vary from state to state. Click here to see the minimum car insurance requirements by state. Do you know what you are covered for in case of an accident? I’ll admit that I didn’t. Except for my deductible, I didn’t have a good idea of my coverages. Here’s a quick overview of the coverages available when shopping for car insurance:
- Liability coverage: This coverage comes into play when your vehicle caused bodily injury or property damage to someone else.
- Medical payments or personal injury coverage: Provides coverage for medical expenses incurred by you and others as a result of an accident.
- Collision coverage: This coverage will pay for repairs to your vehicle caused by a collision.
- Comprehensive coverage: Provides coverage for losses that you suffer on a covered vehicle as a result of damage or loss not caused by a collision (e.g. fire, theft, vandalism, flood, etc.)
- Uninsured motorist coverage: This will provide coverage for losses that you and others sustain when injured through the negligence of an uninsured or unidentified hit-and-run driver.
The most common minimum insurance requirements are bodily injury and property damage. As of the date of this writing, 47 of the 50 states require this coverage. Numerous states also require personal injury coverage and uninsured motorist coverage. The minimum dollar amount of coverage also varies by state.
What you will need to decide for yourself, apart from your deductible and liability amount, are if collision and comprehensive coverage are worth it. These coverages make up 40% of my total premium. The age of your car and whether or not you’re ok with driving around with a dented fender will play into your decision. You may not think the comprehensive coverage is worth the additional cost. I almost declined it when changing my coverage recently. But on the off chance that I run into a deer on the road, I’ll pay the extra $50 a year to be covered. This may differ for you. Insurance is very personal. It’s all about what you’re willing to risk in case shit happens.
Shop For the Best Rates
It’s a good idea to price out competitors every 2-3 years to ensure you’re getting the best rates for your coverage. Keep in mind your initial rates with a new company may be higher if you switch insurance carriers often. One of the questions when I just recently switched was how long have you been with your current insurance company, and how long were you with the company before that? The insurance business is highly competitive and companies don’t want to give preferential rates to a new customer who is just going to leave in a few years. Still, even without this discount, it may be beneficial to check. The only way to find out is to go out there and get some quotes.
I last changed my car and homeowners insurance back in 2012, moving from All State to Progressive. I had wanted to check out Esurance back then but they did not yet offer homeowners insurance in my state. This time around, with homeowners insurance now offered by Esurance in my state, I went with them and knocked 20% off my premium. It would have been more, but I received my first speeding ticket since college a few years ago which bumped up my rates. Here’s a look at my coverage and premium, which does not have the multi-policy discount included.
Six Month Premium for 2006 Acura TSX:
Bodily Injury Limits $250,000/$500,000
Property Damage Limit $100,000
Personal Injury Protection $10,000 Medical
Uninsured Motorist Limits $250,000/$500,000
Comprehensive Coverage Deductible $1,000
Collision Deductible $1,000
Total Six Month Premium for 2006 Acura TSX: $218
If you haven’t changed your insurance in several years, it can pay to look around. In my experience, Progressive and Esurance offer the best rates. Just as online banks like Ally are able to offer higher interest rates on deposit accounts, these online insurance companies have lower overhead and can usually beat out the big boys. Switching is pain free. I made the switch to Esurance completely online in about 20 minutes. In the rare event you need an agent, Progressive was very easy to work with. I can’t speak to Esurance yet, and hopefully won’t ever need to, however, reviews are very favorable.
Readers, how often do you shop around for insurance rates? Where do you fall on the spectrum of minimum coverage to best coverage possible?