Why You Might Have to Shell Out Money for a Car Accident Even if It Clearly Wasn't Your Fault

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  • When you're not at fault for a car accident, you might assume you won't have to pay your deductible when you file an insurance claim.
  • You may need to pay your deductible and wait to get your money back later on.
  • It's important to have an emergency fund for situations like these.

Make sure it's something you're prepared for.

A few months ago, I was driving down the street when a car pulled out of a parking spot and hit me. What made the matter even more unfortunate, and a little awkward, is that the driver was a fellow elementary school parent I'm friendly with.

Thankfully, no one was hurt, since I happened to be driving down the block at a very slow speed. But my car sustained several thousand dollars' worth of damage due to the size of her vehicle and the angle at which I was hit.

As such, I contacted my auto insurance company to file a claim. I then took my car to an approved auto body shop to get in their queue so my car could be fixed.

I figured that since the accident clearly wasn't my fault, I wouldn't have to pay anything in the course of getting my car repaired. But I was wrong.

When you still need to pay your deductible

I was under the false impression that my auto insurance company would go after the other driver's insurance right away so I wouldn't need to shell out money for my deductible, which happens to be $750 -- not a small amount of money. But instead, what I had to do was pay that money (in the form of a swiped credit card) and then wait for my insurance company to go through the process of subrogation, which involves recovering money from the insurance company covering the person who was at fault.

As part of this process, I had to go through an in-depth interview with a representative from the other driver's insurance company to explain what had happened. I then had to wait a number of weeks for that insurance company to make a determination.

At the end of the day, I got a check from my car insurance company refunding me my $750 deductible. But it took a couple of months for me to get my money back as the insurance companies worked things out.

Always have money in savings, just in case

This experience taught me a very important lesson: Always make sure to have some emergency savings on hand. In my case, I had to pay the credit card with my $750 deductible charge well before I was reimbursed that sum from my insurance company. Had I not had the money in my savings account to cover that bill, I would've racked up interest on that balance -- despite not having been at fault for the accident in question.

Of course, your auto insurance deductible may be higher or lower than mine. American Family Insurance says the average auto insurance deductible is $500.

But either way, it's a good idea to make sure you have at least enough cash in savings to cover your car insurance deductible. You never know when you might need to swipe your credit card or write out a check, even if you're completely not to blame for the situation at hand.

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