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How To Save Money After A Car Accident

Recently, my wife was involved in a car accident and we were looking back on the entire situation. We have realized that there were quite a few ways that we could have saved ourselves some money. I’d like to recount a bit of my experience and some lessons I learned in the hopes that if you are someday presented with a similar situation, you might be able to keep a little more money in your pocket.

My Quick Story

Very briefly, my wife was involved in a car accident. It was her fault but nobody was hurt. She was advised by “someone” that there was engine damage to the car and it couldn’t be driven. The car was towed to the nearest auto body shop for a $100 fee. They took more than three weeks to finish the repair. We later learned that there was actually no engine damage to the car, so we could have driven it home. In addition, the shop charged us way too much money for the repair after we later compared rates with other garages. To make matter worse, the rental that my wife drove for three weeks was NOT covered under our policy. That came to about $750 out of pocket for the rental alone.

Here are 6 things I learned from the experience:

1. Cool Off

The first thing I would recommend is not to make any major decisions regarding the repair of your car or anything else related to the accident right after the accident occurs. I think the number one concern of yours should be the safety and health of you and any loved ones and nothing else. Don’t worry about when/if to tow the car, where to take it, what repairs you need to have done, or anything else. Give yourself a little time to get over the stress of the accident. Call the police, get your car off the road, and get any medical attention that you may need. Make sure the accident has been properly reported and documented, especially if the other driver is at fault so that he or she cannot escape liability. Everything else can wait…I’d say until the next day.

2. Protect Yourself Financially

If any repairs are needed and you are insured, more than likely you won’t be paying for the full cost of the repair. Do you know what that tells me? Some people may not have your best interests in mind. Namely, the insurance company (depending on how well you know/trust them) and whatever repair place you choose. Although you may not be paying for the entire cost of the repair out of pocket, you can be sure of the fact that the higher the bill, the higher your premiums will be the next time you renew.

3. Know Your Coverage

I think it’s safe to say that we all know to call our insurance company after an accident. However, this is also a very good time to review your coverage with them, or at least to confirm that what you may be planning to have done is covered. A perfect example: if your car is not able to be driven, and you will require a rental, is the cost of this rental covered under your policy? There is nothing worse than thinking you are covered for something that you are not. Know where you stand before you proceed.

4. Can You Drive The Car?

I want to be very careful what I say here as to not mislead you. If you car is drivable, and it seems like there is no major engine damage, then I would seriously consider driving your car home before making any other repair decisions. But be very careful. Driving a car after an accident can cause further damage, but if you have some knowledge of a car and its inner workings, you should be able to determine this yourself. If it seems like the damage is strictly to the body of the car, consider simply driving it home. That way, you’ll have more peace of mind (and less urgency) to make any repair decisions. Also, physical damage aside, make sure you are in the right emotional state of mind to drive the car after the accident.

5. Shop It Around

If you have reliable transportation post-accident and aren’t in a hurry to get your car fixed, I’d “shop around” the repair for your car. Maybe you can’t get any specific quotes, but you can still call a few body shops to get a feel for how they work, whether you like them or not, and so on. You could ask about estimates, turnaround time (how long it will take for the repair), guarantees, and the like. A little internet research may not be a bad idea either. There’s nothing worse than just picking up the yellow pages and choosing the body shop closest to you.

6. Consider Your Options

I would also keep all your options open to you before making a final decision. If the damage is minor, you may want to consider not even filing with your insurance company. Again if you trust your insurance agent, discuss with them the cost of the repairs. If it is small enough, it might make more sense in the long run to pay for it out of pocket without filing, as it could raise your premiums more than what it would cost you.

Also, consider your repair options. I’ve spoken about my “circle of contacts” plenty of times in the past. It can be extremely helpful to have a diverse and knowledgable circle of friends. If you don’t have a “body shop guy” in your circle, try to find one. They should not be hard to find. I know several that work in the industry. They are good people to go to for advice post-accident regarding your repair, and if they run an independent shop, you could save yourself a great deal of money by taking your repair to them. If you don’t know one personally, I bet you have a friend or relative who does. There is nothing more valuable than an honest assessment of the damage.

A car accident and its aftermath can be a very stressful time for everyone involved. However, that does not mean you should throw all common sense out the window and spend your money unnecessarily. Make sure of the health and safety of everyone involved first, but then try to take a step back and think before making any decisions regarding the repair of your car. Making the right decision could save you a lot of money, while making the wrong or uninformed one could cost you significantly.

Anyone out there with recent car accident experiences they’d like to share? Feel free to do so below.

David started his own personal finance blog, YourFinances101, in June of 2009 and published his first book on ways to save more and spend less called "Don't Be A Mule..." Since then he has been a regular contributor for Money Crashers. He lives just outside Atlanta, GA and most all of his free time is taken up by his amazing three year old son, Nicholas.