Do I Have to Pay Excess If Not My Fault?

Understanding Excess and Deductibles

An insurance “excess,” also commonly known as a deductible, represents the initial amount of a claim that a policyholder agrees to pay out-of-pocket before their insurance coverage begins to contribute. This predetermined sum is a fundamental component of most insurance policies, serving several purposes for insurers and policyholders alike. By requiring policyholders to bear a portion of the loss, deductibles help to reduce overall premium costs and discourage the filing of minor claims.

The application of an excess typically occurs when a claim is made against one’s own policy, irrespective of who may ultimately be deemed responsible for the incident. For instance, if a policyholder makes a claim for damages to their vehicle, they generally must pay their specified deductible to their insurer to initiate repairs. The specific amount of the excess can vary significantly based on the type of coverage, the policy chosen, and the policyholder’s preferences. Different types of coverage within the same policy, such as comprehensive or collision coverage, may also carry distinct deductible amounts.

Determining Fault in Insurance Claims

Insurance companies undertake a thorough process to determine fault following an incident, which involves evaluating a variety of evidence and statements. This assessment is conducted to establish liability and assign responsibility for damages or injuries. Factors frequently reviewed include:
Official police reports, which detail initial observations and potentially cite traffic violations.
Statements from all parties involved in the incident, including drivers, passengers, and any independent witnesses, which provide crucial perspectives.
Photographic evidence of the scene, vehicle damage, and relevant surroundings.
Video footage from dashcams or surveillance cameras, which can offer objective insights into the sequence of events.

Insurance adjusters and investigators are central to this process, meticulously collecting and analyzing all available information to reconstruct the incident. Their role involves assessing the circumstances against applicable traffic laws and insurance regulations to make a determination of liability. The process of assigning fault can sometimes be complex, especially when conflicting accounts or limited evidence make a clear determination challenging.

Impact of Fault on Excess Payment

The determination of fault significantly influences whether a policyholder will ultimately bear the cost of their excess. In many scenarios, a policyholder might initially pay their excess to facilitate prompt repairs under their own policy, even if they believe they are not at fault. This often occurs to avoid delays while the fault investigation is ongoing or in situations involving uninsured motorists where immediate recovery from another party is not possible. If another party is clearly found to be fully liable for the incident, the policyholder’s insurer will typically seek to recover the paid excess on their behalf.

This recovery process is known as subrogation. The policyholder’s insurer steps into their shoes to pursue reimbursement from the at-fault party’s insurance company for the damages paid out, including the deductible. This process allows the insurer to recoup their losses and ensures the policyholder is reimbursed for their out-of-pocket expense. In situations where fault is shared, or “partial fault” is assigned, the responsibility for the excess may be divided proportionally between the parties involved. For example, if a policyholder is found to be 20% at fault, they may be responsible for 20% of the damages or a corresponding portion of their excess, depending on state-specific rules regarding comparative or contributory negligence.

Steps to Take When Not At Fault

When involved in an incident where you believe you are not at fault, specific actions taken immediately following the event can greatly assist your claim.
Prioritizing safety by moving to a secure location and checking for injuries is paramount.
It is important to exchange contact and insurance information with all other involved parties, and if applicable, obtain details from any witnesses present.
Thoroughly documenting the scene with photographs or videos of vehicle damage, road conditions, traffic signals, and any relevant surroundings provides valuable evidence.
If there are significant damages, injuries, or if required by local regulations, contacting the police to file an official report can be beneficial.

When reporting the claim to your own insurer, clearly communicate your belief of non-fault and provide all the evidence you have gathered. Cooperating fully with your insurer’s investigation, providing all requested documentation, and following up on the claim’s progress, especially regarding the potential recovery of your excess, are important steps to ensure a favorable resolution.