Question: My younger brother recently backed into my driver’s side fender. Since we are both covered on the same insurance plan, how will the insurer handle this as far as the deductible payment goes? Can we make a liability claim for the one car and collision for the other? The accident occurred on private property, in our dad’s driveway, and he is technically the owner of both cars, if either of that makes a difference.
Answer: If you're part of the same household and car insurance policy, then a collision claim must be made for each vehicle. This means that normally the associated collision deductibles (one for each vehicle) will apply.
Both damaged cars being listed on the same auto policy makes this type of accident different than if your brother had backed into a friend’s car that was parked in the driveway. Even though both accidents take place on your driveway, hitting a non-resident’s car is treated as a regular claim in which the car's owner could make a liability claim for damages and your brother would make a collision claim for his, since he was at fault.
However, when someone in a household hits another car from that same household, there is no liability claim to be made due to provisions in your car insurance policy. Auto policies have exclusions under the liability insurance section and one usually states that coverage doesn’t apply to any vehicles you own or that are listed on the policy. This is sometimes referred to as a “household exclusion.”
Without being able to make a liability claim for the fender damage that your younger brother caused, this leaves you to make a collision claim -- if your car has this coverage. And your brother, being at fault, also only has the option of making a collision claim for any damage he did to his car.
There is no harm in asking if your deductible can be waived. We have heard of this being allowed on some occasions; however, don’t be surprised if the request is denied and you end up being asked to pay the deductible amount to get your car fixed.
Before placing two collision claims against your policy’s collision coverage, which is very likely to raise your car insurance rates at your next renewal period, we’d suggest finding out the cost of the repairs.
If the damage is minor, you may find out from a repair shop estimate that one or both car’s damages are under the deductible amount. If that is the case, there is no reason to file a claim since your collision insurance benefits only kick in after you exceed the deductible amount.
Using your car insurance for the big things and paying out-of-pocket for the small ones is what we recommend as one way help to keep auto insurance rates down. If your family’s premiums do go up at the next renewal period due to this accident, then make sure you shop around to see if better rates are possible.
Comparison shopping will help you find the car insurance company that is priced competitively for your set of rating factors. Rates vary by hundreds, if not thousands, due to the different rating systems of car insurance carriers, so your current one may rate high for accidents while another in your area will not. (See “Pocket $1,102 by just shopping around”)