Should you pay for repairs out of pocket?

When you’ve been in an accident, your first instinct is probably to call your insurance company to begin filing a claim. However, is it always worth the effort it takes to file a claim? There are some cases in which it may be less hassle to pay expenses out of pocket. Here’s how to tell the difference.

Sometimes it will be worth paying an expense out of pocket. This is typically the case for minor incidents—think a chipped windshield or a dented bumper. If you, say, pulled up too far and dented your bumper on a shelf in your garage, or a pebble flew up and put a small chip in your windshield, you’re probably looking at a relatively inexpensive repair.

Of course, you’ll always want to account for the deductible cost when making your decision. If you have a $100 repair and a $500 deductible, it’s certainly easier to pay for the repair yourself.

When deciding, there are a few things you should consider.

Were other people involved? In most states, you’re required to report an accident that causes more than $1,000 in damages. It’s usually a bad idea to pay out of pocket for accidents involving another driver.

Have you filed an at-fault claim recently? If you’ve filed one or more at-fault claims within the past 3-5 years, your rates could become excessively expensive. If this sounds like you, it might be better to pay out of pocket or you may become a high-risk driver.

Does the cost of repair exceed the deductible? You may also want to pay out of pocket even if the cost exceeds your deductible. If the accident raises your rate over time more than what you’d pay out of pocket, consider eating the expense and saving in the long run.

Do you have an emergency fund? If you can afford repairs for a minor incident, it’ll save you the hassle of dealing with insurance.

If you’re still not sure, you can call your insurance company and they can help you decide. It may seem counterintuitive to not use your insurance, but remember that for minor incidents it can save you in the long run. Again, for incidents involving another driver, you’ll likely want to or have to notify your insurance, just in case something happens down the line. But when the damage is minor, consider all of your options.