Autoversicherung: when is it better to pay your own accident costs?
By: mlauterwein | Posted: 22nd January 2008
A traffic accident is always unexpected and always leaves those involved with insufficient time to react. In Germany whoever is responsible for causing the accident should notify their Autoversicherung provider in writing within a week. This is important in the event of the injured party claiming for damages or also in the event of a police investigation being set up against the “perpetrator”. Anybody who does not notify their insurer in these circumstances risks endangering their cover.
If the accident has caused injuries to the third party, one should be certain that even the smallest damages are paid out of the Haftpflicht or third party cover. This is the only way for the culpable party to protect himself against any subsequent demands for compensation.
In accidents where the damage is “only” material there is a calculation which can be made to establish whether it makes more sense financially to pay for damages out of one’s own pocket in order to preserve the no claims bonus: the so called Rückstufungstabelle (a table showing premiums for the various no claims classes). As a rule the instigators of road accidents have less to pay when they cough up for small damages out of their own pocket. That is true not only for the third party cover but also for any fully comprehensive policy which would come into play for the first party damages. Up to which amount a payment remains the best option depends on the no claims status of the policy (SF-Klasse) as well as the insurer. As a rule of thumb: costs up to twice (or even three times) the yearly premium should be paid by the driver to negate the risk of Rückstufung (being placed in a higher SF-Klasse with higher premiums).
The number of reported damages is actually more of a factor than the total cost in terms of the decision to punish the first party making him pay higher premiums. For example, 2 repairs at a combined cost of 1000 Euro covered by the insurance would yield much higher costs for the customer through increased premiums. In any case it is perfectly reasonable to confront one’s insurer to question directly as to whether it is in one’s own financial interests to pay up and retain the no claims bonus or whether it is better to leave it in the hands of the Autoversicherung.
With third party policies and even sometimes with comprehensive policies it is possible to a arrange a so called “damages buy back”. In this way the no claims bonus can be retained against the cost of the damages.
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Tags: third party, rule of thumb, circumstances, three times, risk, insurance, traffic accident, perpetrator, road accidents, premiums, insurer, injured party, germany, claims bonus