Question: A car titled in my name was totaled out.  It was on my father’s insurance policy, and his insurer paid out the accident claims but now says I cannot continue under my father’s policy because I no longer live with him.  When shopping for auto insurance, do I have to report the accident to my new insurance company since the policy was in my father’s name and it will be a different car that I’ll be insuring? 

Answer:  Yes, if you’ve been in an accident and had a claim paid out for your car, then you’ll need to inform any new car insurance company of this incident — even if you were on someone else’s auto insurance policy at the time. 

It can be confusing trying to figure out what information is required when applying for your first car insurance policy, but if you fail to list this when applying for a policy your new insurer is still likely to find out about it, at which time it may become an issue.

Any insurance company that you apply for a policy with is going to verify that the information you give is accurate by requesting various reports, including copies of your motor vehicle record (MVR) and property loss report.

If your state’s Department of Motor Vehicles places notations on your driving record for accidents, then your car insurance company should see the incident when they check MVR.  

Even if the accident isn’t listed MVR, it doesn’t mean that your new insurer won’t find out about the totaling of your car and resulting claims. When you make a claim after an accident, the insurance companies involved input the claims information into a property loss database that most insurers refer to as the C.L.U.E. (comprehensive loss underwriting exchange) report.

This consumer report shows any new insurer information about all claims you filed under any previous insurance policy within the past seven years.

The policy may have been under your father’s name, but you were the one in the accident and the car was titled in your name, so your name should appear on the CLUE report along with information on the type of loss and amount paid for the claim.  

If you fail to mention the accident when shopping for your car insurance policy and your new insurance company finds out about it, then they’ll have to figure what to do with your policy.

The insurance provider might just recalculate your rates and send you a notice to pay an additional premium to keep your policy in force. Or you could receive a cancellation notice if what they see as misrepresentation about the accident now causes your new insurance provider to find you too high of a risk to insure.

Giving correct information when shopping for car insurance is important because car insurance companies want a full picture of what type of risk you and your vehicle represent, and so that you can truly find out what company will be provide you with the cheapest car insurance rates.

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Penny Gusner
Consumer Analyst/Insurance Expert

Penny has been working in the car insurance business for more than 10 years and has become an expert on procedures, rates, policies and claims. She has seen it all, and working with from its inception, she researches the routine and the bizarre with equal enthusiasm. She has three very active children and a husband with a zeal for quirky cars.