Claim insurance or pay cash?

I bought my car last thursday, so not even a week ago, and i've been insured since then also. On saturday, as i was trying to parallel park, i ran into the car behind me, damaging the front side of their car and the side of my car as well. My car isn't that bad but their car was pretty bad. I left a note with my number and everything and the owner and me discussed me paying cash instead of claiming insurance.

Since i got my insurance less than a week ago, i'm thinking the price will go up quite a lot but i'm not sure. I have no idea if it'd be better to pay cash or just claim insurance and the insurance can repair their car, as well as mine.

What do you guys think?
Additional Details
Thanks to everyone who answered..the whole situation is pretty weird and looks sketchy to me. The woman was supposed to call me back today but she never did. I don't really understand what she's waiting for...anyway, thank you all...we'll see what happens. If anything, i'm pretty sure i'll claim insurance...that's what it's there for anyway. :)

Bryan R

Get an estimate of damages from the other person, and if possible go with them to the shop who writes the estimate so no "side deals" can be made. A reputable body shop will provide a reasonable estimate up front, but don't be surprised when the price gets into the thousands, and you may expect additional damages to be found during the repair process, so the other person may hit you up for that as well. Then it is reasonable to assume the other person wants a rental car while their car is repaired and you would owe for that. Remember, your liability insurance pays 100% of the other persons damages you are liable for, you do not have a deductible unless you carry collision coverage for your car and have it repaired. Some states like Michigan require all parties to handle their own damages and the most one can collect is their deductible from an at fault party.
You'll have to take into account how much your premium rates will go up with an at fault accident on your record. Most likely it will not be as much as what you'll pay out of pocket, and your premium is paid over time usually, so you don't have to come up with all the money right away. I usually find that most who want to pay the other person out of pocket end up paying more than if they let their insurance handle. Plus, your rates won't get the chance to go up until your policy comes up to renew in 6 months to a year, so you won't pay a higher rate for at least that amount of time.

My suggestion is to turn it in on your insurance if it is over $1000.00 because that is the total you will likely pay over time with an increase in rates. Depending on what your collision deductible is, you could get your car fixed too using your insurance. If you have the money to pay it out, put it in a savings account, let the insurance handle it, and then if you have a rate increase, offer to pay your full amount of premium at once and you'll likely get a discount that may equal to what you were paying before, and your money made a little interest as well.

You could also make a collision claim for your car, get paid for the damage amount minus your deductible and not repair it and just keep the money. You do not have to repair your car and your insurance cannot make you. Their job is to pay for a reasonable amount of repairs, not repair the car, that is your choice. If you don't have a loan, then the money goes to you, if you do have a loan, then it gets paid to you and your loan holder.

Karle

get the other person to get quote and see what it will cost to fix
then see if its really cheaper than paying ur deductible....
then if u go cash route write a agreement that releases u from further liability

Knowitall

It is none of the other car owner's business if you pay cash so he is up to no good. Do not trust him.

Gambit

No one here knows what the difference in premium will be if you decide to file a claim vs. paying the damages out of pocket. You would be better off contacting your broker/agent and discussing this with them. They have way more information (not to mention more accurate information) than anyone here.

Enter Your Message or Comment

User Name:
User Email:
Post a comment: