What Is a Property Damage Claim?

Property Damage Claims Explained in Less Than 5 Minutes

Property damage claim

The Balance / Theresa Chiechi 

A property damage claim is a report that you submit to an insurance company. You file this type of claim when your property has been damaged.

Claims related to auto accidents come in many shapes and sizes. Each state has its own laws governing claims. If your car is hit by someone else's car while parked, for instance, then you can file a property damage claim. You can also file a claim in other cases, such as when a car slides off the road and damages your mailbox, lawn, or home.

Definitions & Examples of Property Damage Claims

Auto insurance policies have different coverages that apply to different situations. All policies must have a form of liability insurance that includes property damage. If your property is damaged by another driver, that driver's policy will cover it.

Policies also have comprehensive and collision coverages. Comprehensive coverage applies to damage caused by events you cannot control. These include fire, acts of nature, or hitting an animal. Collision coverage applies when you are in an accident with another car.

Once you've been in an accident or find out your property has been damaged, contact the police to file a report. This will create a record. In most cases, a police report also will decide which party was at fault.

Never say anything to the police that might seem like you are admitting fault. Even saying, for instance, that you shouldn’t have parked close to a busy road is too much.

Take as many photos as you can. This will give you a record to go with what the police will gather. The more data you have, the greater chance that you will get the outcome you desire.

How a Property Damage Claim Works

The at-fault car owner’s policy should pay to repair property damage. Even in no-fault states, the at-fault car’s policy pays up. In this case, the coverage is provided by the insurer covering the car, not by the driver of the car.

If you damage someone’s property with your own car, your standard deductible will not apply to repair their damages. But, if your car was damaged at the same time, you must pay your collision deductible to get your own car repaired. If another driver damages your property, you will be able to file a property damage claim with their insurer and will not have to pay a deductible.

Once a police report has been filed and fault has been determined, your insurer will have a claims adjuster review the case and the damage. For instance, if you are at fault for driving off the road and hitting someone else's fence or mailbox, the claims adjuster will review the facts of the case before payment on the claim is made.

It gets trickier if your property was damaged and you don’t know who was at fault. This changes the claim from a property damage claim into a collision claim. You will have to pay the amount of your collision deductible out of pocket. If you do not have collision coverage, your insurer will not pay out for the claim.

If someone hits your property, filing a claim on their policy will not affect your rates. If you do not know who damaged your car and you file a collision claim under your own policy, it will often increase your rate at renewal time. Expect a surcharge when your policy renews for filing an at-fault accident.

The time it takes for claims to process can vary. Fault needs to be determined. Both parties need to be contacted by the claims department. You can speed up the claims process by making sure that you are available to speak with the claims representative.

Do I Need Uninsured Motorist Property Damage Coverage?

The Insurance Research Council (IRC) estimates that one in every eight drivers in the U.S. is uninsured. But, only 22 states mandate uninsured motorist property damage coverage. Drivers in the other 28 states have the option to purchase this type of policy. This provides coverage if someone hits your car but has no auto insurance coverage. Such a policy also can provide coverage for hit-and-run accidents.

In states where the coverage is not required, most leave it to the insurance companies to decide whether or not to offer it. Deductibles can apply to the coverage depending on how you set your policy up.

If you live in a state where it is not required, it still is a good idea to review your insurance carrier offerings and rates. This will help you decide if adding this coverage is right for you.

Key Takeaways

  • The at-fault car owner’s policy should pay to repair property damage, even in no-fault states.
  • If you do not know who is at fault, you can file a claim under your own policy, but expect to pay a deductible.
  • It's important to take your own pictures and document your own evidence.
  • Expect your rates to go up if you are the party at fault.