Financial Effects of a Car Accident

Car Accident

Every day, we witness car accidents happening throughout the country, especially in highly-populated states such as California. For instance, statistics show that the City of San Diego, which is home to more than 1.41 million residents and over 500.000 drivers, registers an increase in car accidents when compared to data from 10 years ago.

A car accident can have a huge effect on your life. It can cause serious trauma, painful injuries which take a physical toll on your body. If a person is involved in a car crash, the first thing they’ll think about is their health and the well-being of those around them. However, in the aftermath of such an accident, people often forget that they may also have to deal with insurance claims, file lawsuits, and figure out how to pay for all the mounting expenses involved.

There are countless ways of how car accidents may affect the financial wellbeing that you, as a driver, should get informed about. In this article, we’ll look at certain financial effects of a car accident that are worth being aware of as this will help you plan your next moves if faced with such an unfortunate event.

Hefty Medical Bills

The first thing we should mention is that you should contact a professional attorney if you’ve been involved in a car accident and are confused about what to do. For instance, if you live in San Diego, you should immediately get in touch with the best personal injury attorney San Diego has to offer and get informed about the legal steps you should take. If you’ve sustained serious injuries, leave calling your attorney for later as your overall health should always be your priority.

All of us know that if someone has been in a car crash, they have most likely sustained an injury that requires medical care and treatment. If a person lacks adequate health insurance, the cost of immediate medical care, but also for follow-up treatment and rehabilitation services, can be quite substantial.

Always team up with good legal counseling and gain a better sense of the future anticipated costs like medical bills are the biggest loss victims suffer from following a car accident.

Vehicle Damages and Repairs

Vehicle Damage and Repairs

The most obvious thing on the list of financial effects is probably the property damage and the bill you get from your mechanic after your vehicle has been in the repair shop. It’s safe to say that almost all accidents involve some level of vehicular damage but if it has taken plenty of beating and suffers major mechanical damage, the cost of the repairs will mainly depend on your vehicle’s pre-collision actual cash value (ACV).

The insurance will cover the repairs if they total less than your vehicle’s ACV. However, if the total amount of the repair costs combined with the salvage value of your vehicle exceeds its ACV, then it’s usually deemed a total loss and you’ll be compensated for your vehicle’s current value. If your vehicle is totaled and you want to keep it, your insurance company could allow it, but you may receive a smaller settlement and pay for the repairs yourself.

Insurance Premiums 

Car Insurance Agent

Certain expenses may not be covered by your car insurance policy and you may still be required to pay a deductible even if both you and the other party involved in the crash have car insurance.

The deductible usually varies from one policy to another and it’s therefore recommended that you consult an experienced personal injury attorney to get a better understanding of the damages, the uncovered expenses, and look at all available options for pursuing compensation. In addition, expect that you will see a substantial spike when paying for the same policy when the time comes for your auto insurance renewal.

Alternative Transportation Costs

If your car is considered a total wreck after the crash or if you’re awaiting repairs, you might be faced with the difficulty of lacking personal transportation. Even if you didn’t sustain serious physical injuries, not having a reliable means of transportation to and from your working place can seriously jeopardize your source of income and personal finances.

Even if it’s a temporary situation, living without your car can make it difficult to run errands and complete basic daily chores. You’ll have to find alternative means of transportation like a taxi, rental car, or bus, which incurs additional expenses.

Final Words

It’s common for car accident victims to underestimate the total financial repercussions of a crash, which may lead to unwise decisions and total financial ruin. 

To avoid financial losses, consult a legal expert who can represent your best interests and explain the full financial extent of the damages regardless of the cause of the car crash.

The views expressed in this article are those of the authors and do not necessarily reflect the views or policies of The World Financial Review.