For car insurance claims, it's better to pay small claims...

For car insurance claims, it's better to pay small claims out of pocket and file a claim when damages and injuries are significant, experts say. Credit: Getty Images / iStockphoto / Robert Crum

When it comes to filing a car insurance claim, should you or shouldn’t you? It’s tricky. People often believe that if they do, their car insurance rate will go up.

According to a study commissioned by of the largest insurance carriers across the country, after filing a single claim of $2,000 or more, premiums rose an average of 42 percent, costing, on average, $352. And for those going back a second time in a year, rates rose an average of 92 percent.

So, is it worth paying out of pocket instead?

  • It depends: “If you have been with your carrier for a number of years with minimal claims paid out, filing a claim probably won’t increase your rates. If this is your first year with a carrier, filing a claim may increase your rates or the carrier may even non-renew,” says Dana Gold, an insurance consultant in Atlantic Beach.
  • Know the rules: According to Chris Burdick, founder of, in New York, insurers have no right to hike insurance premiums if the total damage from the accident is less than $2,000, provided no one was injured or killed in the accident. However, if you’re in two or more accidents, the auto insurance company may issue a surcharge, even if the total damage from each accident was less than $2,000.
  • Do the math: “It’s often cheaper, in the long run, to pay out of pocket for minor damages. Consider paying out of pocket if the cost of your damages is a few dollars more than your deductible, or if you’ve already filed a claim in the past,” says Maxine Reiman, head of insurance research at ValuePenguin in Manhattan.

However, always file when damages and injuries are significant.

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