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Can I cancel my car insurance claim?

Review of ASDA Insurance
Here's what you need to know...
  • There are several reasons why you may choose to cancel an auto insurance claim
  • If you cancel a claim, that does not necessarily mean it will no longer be on your record
  • In some situations, especially if you were found to be at-fault in an accident, canceling your claim is not an option

Reading through any contract that you are entering into is crucial.

Since auto insurance is a contract and not just a product, reading through the policy booklet that describes your rights and your obligations is an intelligent thing to do.

One of your obligations as a policyholder is to notify your insurance company when you experience any loss that results in damage. Unfortunately, many assume that notifying their insurer is the same thing as filing a claim.

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Filing a claim, while it is your right, is not always a practical option if you do not have the right coverage options or high deductibles.

Before you hastily file a claim, it is important to review your coverage options and to assess how much your payout would be.

If, however, you have already taken the leap and discussed the loss with a claims representative or a claims adjuster, you might be interested in taking back the call you made.

In some scenarios, it is possible to cancel a claim, but a canceling the claim may not save your insurance rates.

When should you cancel a car insurance claim?

payout following a car accident claim

There are many different reasons why a policyholder might be interested in canceling a filed claim, but one thing that all of these reasons have in common in the goal.

The ultimate goal policyholders have when they are filing claims is to save money and avoid falling victim to a rate increase.

Also, some may choose to cancel a claim simply because the claims process can be so stressful. What you might not know beforehand is that canceling a claim does not always mean that the claim will not be investigated before it is closed.

Here are some of the scenarios when an accident claim or comprehensive claim might be best suited as a closed claim:

– Your High Physical Damage Deductible Exceeds the Damage Estimates

Carrying a high deductible on comprehensive and collision coverage is a great way to save on your premiums. With a high deductible, you take on a larger portion of the loss.

In exchange for paying more out-of-pocket, you will get a discounted rate.

There is less risk of the insurer having a claim where a payout will be made.

While a high deductible can be a money saver, many people will choose the highest possible option without actually understanding how their deductible works.

It is not until they file their claim, and they have the damage inspected and repairs estimated that they will discover the company will not even pay for minor collisions.

– You Cannot Afford to Pay Your High Deductible

Another problem that can arise with high deductibles is that the insured is required to pay the deductible before there is a payout.

Any respectable agent will advise someone who is buying insurance with a high deductible to think twice if they cannot afford to cover it when the time comes.

If you are willing to put away the money you save away to use, raising your deductible could be a good option.

If you do not, and have a loss and where you just cannot come up with the money to pay for the portion that you are responsible for, canceling the claim and dealing with the damage at a later time seems like a viable option.

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– You Want to Avoid the Claims Process

If you have never filed a claim, you might assume that the process goes very quickly.

You might believe that you are not at-fault for a loss just to discover that your adjuster has been going back and forth with the other company to agree on a fault determination.

Even minor claims can take weeks or months to settle when there are no witnesses, and each party is giving different accounts. Dealing with the claims process and answering questions over and over might be enough to entice you to close the claim.

Unfortunately, many times claims have to be thoroughly investigated before they can be closed with a $0 payout.

– You Do Not Want the Claim on your Record

It is a common misconception that a canceled claim is a hidden claim.

Canceled claims may not cost the insurer money, but the claim will stay on your driving record. When a claim is filed, the claim will be stored in the computer system.

It will also be reported to the CLUE Database.

This database shows all of the losses a policyholder has had in the past no matter how much the payouts were. Claims that are withdrawn are still on your record for years to come.

If you report that you have never had a loss, doing so could be a misrepresentation. While a zero dollar claim does not usually lead to surcharges, they can affect accident-free discounts, which is a critical consideration before filing.

When Canceling a Claim May Not Be Permitted

Insurance expert examining car damage.

You cannot cancel just any claim.

If you have a loss that you are at-fault for, the claim may stay open for months or years — especially when a third-party has reported injuries and is seeking medical treatment.

The claim to repair your vehicle with your collision coverage may be withdrawn, but the claim for Bodily Injury Liability cover will stay open until the injured party has fully recovered.

You will face a rate increase once your policy renews because you caused injuries while you were operating your vehicle.

You also have to reassess whether or not to cancel a claim for damage to your car when the damage is severe. You may be required to show that the car was repaired, or the insurer may drop the coverage entirely.

If you cannot afford to do the repairs without cashing the claims check, you could have trouble finding insurance.

Insurance companies want to pay as little as possible on claims. They welcome policyholders who want to cancel claims in the right situations.

If you are not happy with the service your insurer has provided, you might want to begin to shop for a new plan.

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