3 of 4 insured drivers prefer to pay out-of-pocket rather than filing insurance claim
HOUSTON - If you've shopped for auto insurance recently, you know it's expensive. So much so, that a new survey finds most people would rather pay for damage out-of-pocket, than file a claim.
Lendingtree's Rob Bhatt says, with the average $500 deductible added in, a simple claim could mean an additional $3,000 over three years, "If you cause an accident that leaves more than $2,000 in damage, you could see your rates go up about $80 a month."
SUGGESTED: More people blurring homes on Google Maps to enhance security
The Bureau of Labor Statistics shows average auto-insurance rates have already climbed about 30% over the last decade, and Texas rates are consistently higher than the national average.
Consequently, the Lendingtree survey finds 73% of insured drivers would prefer to pay out-of-pocket for repairs, rather than filing a claim. 39% of insured drivers who've been in an accident have bypassed their insurance for repairs, and 24% who did file a claim, later regretted it.
While auto insurance is meant to be a financial safeguard for drivers, Bhatt says there can be a reason not to use it.
"You want to save it for the big things, and if you can afford to pay a small claim out of your own pocket, it's usually worth doing so," he says. "Particularly if the damage is less than $2,000."
The concern for drivers is that a claim will trigger higher rates, and it happens. The survey finds about half of respondents saying their premiums rose by as much as 50% after filing a claim, and it can take several years of careful driving to bring the rates back down.