You’ve had a car accident. Now what?

4 06 2007

Porsche v Guard rail

I’ve worked at an insurance company for most the past 5 years while I have been studying. I’ve also dealt with a fair share of motor vehicle accidents while volunteering at a Community Legal Centre as part of my law degree.

So many problems arise out of motor vehicle accidents and a lot them stem from people not knowing what to do when they have an accident. None of this should be construed as legal advice but just some practical tips.

Insure your damn car!!!
If you’ve already had an accident this wont help (nor will insurance fraud) but I really can’t emphasise this enough. If you can’t afford Third Party Property Damage insurance then you can’t afford to drive a car and you should take a bus. If you run up the back of a BMW, this is the type of insurance that will pay for the damage you caused to the other vehicle, not your own. But it could save you from going bankrupt.

This insurance does not come as part of your registration if you are in Victoria. In NSW you need this insurance in addition to the Compulsory Third Party (CTP) policy that you are required to take out in order to register your vehicle. A CTP policy covers the personal injury you cause to another person in an accident, not their car.

The less money you have, the more important it is that you have insurance. Not the other way around. I see so many people come through the legal service with a default judgement against them and a bill that they cannot ever hope to pay.

Something that most people dont know is that most third party policies also cover your car if someone else runs into you and they dont have insurance.

At the scene
Its important that you get as much information from the other party as possible. Ideally you should get their licence no, rego no, full name and address, and a contact phone. Try and verify the phone no at the time by calling it if its a mobile. Try and get this information directly off the other party’s drivers licence. If you are insured you’ll need this info to make a claim if the other party is at fault.

If there is only minor damage, you’re not blocking traffic or presenting a safety hazard and no one is injured then you don’t need to call the police. If you do call the police they’ll invariably charge someone with careless driving just for wasting their time.

If the police do attend DONT rely on them to provide you with the details of the other party. If there is no offence committed such as the other party leaving the scene without exchanging details, you will not be able to get their details from the police or Vicroads if you fail to record them at the time. You will then have no way of recovering the cost of the damage to your vehicle.

Post accident
If you were at fault and you’ve got insurance then contact your insurance company, lodge a claim, pay your excess and forget about it. The insurance company will look after everything from there because that is what you pay your premium for. One at fault claim will generally not have a significant impact on your policy. With most insurers it will have no impact. Its worse with the budget or cut price companies. They keep their costs low by sticking it to you if you do have an accident and Iwould generally avoid insuring with them.

The general cost of repairs if there is panel beating required is around $1,000 per panel. If you are not at fault and you have comprehensive insurance, then go through your own insurer. Because you’re their customer they will look after you better. You’ll also get more control over the repairs to your vehicle. As long as you can provide the name, address and phone no. of the other party and the accident circumstances are fairly clear then they’ll waive the excess on the spot. Where someone runs up the back of another car, they are automatically at fault for not leaving enough breaking distance. If it was you, there is absolutely no point in arguing about, it doesn’t matter why they stopped or how quickly they did it.

If you were not at fault then don’t let the other party insist on getting the repairs done privately. They have no right to do so and you’re not under any obligation to get more than two quotes. If you do get the repairs done privately you could end up having them done on the cheap by a friend of the other party and lose any recourse if they do a crap job.

At fault. No Insurance
You should have bought insurance. That’s the first point. If the other party is insured then expect a letter of demand from a insurance company fairly shortly. They will pursue you through court and get a judgement against you if you fail to pay. They then sell the debt to a ‘recovery’ company (read debt collector). If you can’t pay in one hit then negotiate a payment plan. Most insurers offer a payment plan automatically now. If the circumstances of the accident are unclear then you may have some room to negotiate a percentage split so that you pay less but insurers generally wont move that much. If you need some help and can’t afford a lawyer then go to a community legal centre. We can help negotiate for you but beyond that there’s not much we can do.

Not at fault. No insurance
As I mentioned before, if someone hit you and doesn’t have insurance but you do have third party cover you may be able to get around $3,000 to $5,000 worth of cover under your own policy. If the other party doesn’t have any insurance then they’re probably not going to have much money either and there’s really very little you can do. Start by getting two independent quotes for the damage caused to your vehicle. Then write a letter to the other party stating that you hold them responsible for the damage caused and the timeframe in which you expect to receive payment. Make it clear that you are prepared to proceed to court over the matter. Follow it up with a second letter if you don’t get a response. If you’ve got a friend who is a lawyer then ask them to write something on their letterhead because it might scare them into paying something.

Be prepared to accept a lesser amount than what the damage actually cost, its better than nothing and preferable to a payment plan where you may or may not receive any payments. If the damage is less than about $5,000 is probably not going to be worthwhile going to court or hiring a solicitor unless you are capable of doing the work yourself. Again a community legal centre can provide advice but can’t do all the work for you. If you can’t afford a lawyer and don’t think that you can navigate the legal system by yourself, then you might need to cut your losses and run.

Lodging a complaint in the Magistrates’ Court is relatively simple but costs money and can be time consuming. The registrars at the court can help you with the forms but are limited in how much help they can provide. Even if you do get a judgement you still may not get anything. If the other person has no money and no assets then they’re ‘judgment proof’ and there will be nothing for the sherrif to seize and you have to pay the sherrif for his time regardless. Even before you get to this point you would still have to take steps to enforce the judgement which equals more time and money and this will have already taken six to twelve months.

In my opinion it should be compulsory for every road user to have third party insurance and should be included as part of the rego or drivers licence fee just as your TAC premiums are in Victoria. With a state wide system it would bring the cost down too. Younger people and those who have a bad driving history, the ones who most need insurance and are least likely to have it, would then have cover automatically for any damage they cause. It would save lots of people a lot of hassle.

But the government is too weak willed and too sensitive to public reaction to conisder such a measure and things will continue as they are for the forseeable future. In the meantime if you have an accident and either you or the other party don’t have insurance, it will be a real pain in the rear.

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16 responses

12 06 2007
Tom

Great read Timmy, post this up on OzHH and i will make it a sticky

🙂

15 06 2007
Insurance and car modifications « Nothing Happening

[…] and car modifications 15 06 2007 Following on from the car accident post, this was my response to a question re car modifications and insurance. Sorry I can’t be more […]

7 03 2008
Jeparit

Third party property insurance is NOT needed in NSW to get your car registered.

Third party (referred to as CTP) only is required.

7 03 2008
Tim

Thanks for the comment.

You’ve misread the post there. I’ve said that you must have CTP for rego but that you shouldn’t bother driving around without third party property damage cover as well.

I was just illustrating the difference for NSW people, because CTP comes with your rego in VIC whereas in NSW you need to buy it separately and alot of people think that CTP is TPPD.

Tim

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24 03 2015
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Thank you for sharing more information on what to do after a car accident. It is always unfortunate when a car accident happens because there are so many things you have to deal with. It is important to get as much information as you can from the other party. In some cases, you may need to hire an accident lawyer to help ease the process if the accident was serious. Thank you again, these practical tips you have shared have been extremely helpful.

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