Car damage: claim or pay for it yourself?

For car insurance, there are consequences if you claim a car damage. It costs you claim-free years. As a result, your premium may be higher the following insurance year. When is it best to claim, and when not to claim?

Car insurance premiums depend heavily on claim behavior. By driving claim-free, you build up claim-free years. By claiming car damage on the insurance company, on the other hand, you lose loss-free years. If the insurance company can recover the damages paid out from a guilty party, it has no consequences for the premium of the car insurance.

What about the claim-free years?

After one insurance year with no car damage, you get one claim-free year. Claim-free years entitle you to a discount on the premium. The premium discount can be up to 75% and even higher with some insurers. When causing a car damage, the insurer must compensate you for the damage. In the year of the claim, you do not build up a claim-free year, but rather you lose several claim-free years. One claim can cause your discount to drop by dozens of percent. Because of this, it may not be wise to claim small amounts of damage.

Which claims will be charged to your claim-free years?

This applies to damages you claim from your insurer. For example, you fail to give a car the right of way and cause a car damage. You are to blame, so the other party's damage is claimed from your car insurer. Are you all-risk insured? Then you will also be paid for your own damages. Damages insured under the WA limited hull insurance will not be charged to your claim-free years. This is the case, for example, with broken windows, theft of the car and collision with stray animals. Also, car damage that your insurer pays out and then recovers from someone else will not cost you any claim-free years.

How much does the premium go up after one claim?

This varies by insurance company. This is because it differs per insurer how much discount you get for the claim-free years. It also makes a big difference whether you have only a few claim-free years or more than 10. In order to give you an impression, we start from any large insurance company. For the sake of clarity, costs and insurance tax have been excluded.

Your car is WA cascade insured. You have accumulated 7 claim-free years. The insurer will give you a 64% discount on your premium. Assuming a basic premium of € 1,000, you pay € 360 in premium. You cause damage of € 650 to the other party's car. Should you claim this damage, or are you better off bearing the burden yourself? Because of the damage, you fall back in discount to 40%. The next insurance year, the premium will be €600, an increase of €240. If you assume only next year, it might make sense to claim the car damage. But, the consequences are greater. In the next insurance year, without the claim, you would be entitled to a 72% discount. The claim brings the discount in the second year after the damage to 48%. The second year will also cost you an additional €240 in premium.

Calculated over 3 insurance years, the premium increase exceeds the claim. When you add up the amounts, it is therefore disadvantageous in this case to claim the car damage from the insurer. The consequences of a declared car damage reverberate for years to come.

In the earlier example, did you have your own car damage? Then it was a different story. Suppose you yourself also had a damage of €650. The total loss would then be €1,300. In that case, of course, claiming the damage makes sense.

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