Should I Pay for a Car Accident Out of Pocket?

In our previous blog, we talked about what to do if you get into a car accident that’s not your fault. Now, we’ll be discussing what to do if you get into an accident that is your fault and are wondering if you should pay for the damages out of pocket instead of going through your insurance. To make an informed decision, you need to know what the pros and cons are of paying for a car accident out of pocket.

Pros and Cons of Paying Out of Pocket


  • The claim will most likely stay off your record and, therefore, not affect your car insurance rates. The main reason many people choose to pay for accident damages out of pocket is because they don’t want their rates to increase. Depending on your situation, this can have a big impact or a small impact. If you have a young driver on your policy or have recent accidents or tickets already on your record, adding this new accident to your record can have an exponential effect which is why paying out of pocket might be an ideal solution.


  • Injuries can have a huge impact on any type of accident. If anyone is injured, don’t even think about paying out of pocket. It is, simply, not worth the hassle. In fact, if there are injuries, it is advised that you call your insurance company to report the accident even if the injuries are minor.
  • Estimates can end up changing. For example, let’s say you and the opposite party agree on an estimate for $1200. After the opposite party goes to take the car in, the shop finds out there are some additional damages that were found which means the damages will now cost $2200 to fix. Estimates are just estimates which means even if you and the opposite party do agree on one, there is no guarantee that the estimate you both agreed on will stay the same. The good news is, if additional damage is found and the cost to pay for the damages is too much for you, going through your insurance instead of paying out of pocket is still an option available to you.
  • The opposite party might expect you to pay for a rental car. Since you are not going through your insurance to pay for this accident, the opposite party might expect you to pay for a rental car for them since that is, typically, what your insurance would do if you were to file with them.

What to Do If I Want to Pay for Damages Out of Pocket?

If you’ve decided that the pros outweigh the cons when paying for an accident, then here’s what you need to do.

  1. Make sure you get at least two different estimates to repair the damage.
  2. After you and the opposite party agree upon an estimate, pay the body shop directly.
  3. Sign a liability release form. Since you aren’t filing through your insurance, you need some sort of protection for yourself. Signing a liability release form can save you from any future disputes where the opposite party might try to come back and say that you didn’t pay for damages to their car.

Our Recommendation

With all these factors at play, it can be hard to decide what the right choice is. If you’re not sure what to do, we recommend that you give PNW Insurance a call! Not all situations are the same which is why we’d be happy to help guide you and understand what the best course of action is. Contact your Puyallup insurance professionals if you’re in need of any assistance. Our team of local independent insurance agents would be happy to help!

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