Another driver rear-ended my car and we exchanged insurance information. I took photos of the insurance information on my phone. I filed a claim with my insurance company. The adjuster reached out to me and said the other driver’s insurance company is refusing to acknowledge the claim because the driver claims he was out of town with his vehicle when the accident took place. It will cost $1,800 to fix paint damage to the bumper and my deductible is $1,000. Apparently, I wouldn’t normally have to pay the deductible because I’m not at fault, but I now have to pay it because the other party denies it happened. This doesn’t make sense to me. Is this how it’s supposed to work? – Gil, Brampton, Ont.
It’s complicated. If somebody hits you but you can’t prove it, you might not be covered unless you have collision insurance, said the Insurance Bureau of Canada (IBC).
“If the driver carries collision coverage, they could have repairs completed under this portion of their policy, subject to their deductible, until a more thorough investigation can take place,” Rob de Pruis, IBC’s national director of consumer and industry relations, said in an e-mail. “Obtaining witnesses, dash cam footage or … a more thorough investigation by the adjuster could be helpful.”
Let’s back up.
There are three main types of car insurance coverage: liability, collision and comprehensive. Liability coverage is mandatory everywhere in Canada. In most provinces, the other two are optional.
Liability covers damage and injuries that a driver causes to other people, vehicles or property. Collision covers the cost to repair your own vehicle if you’re in a collision and you’re at fault. Comprehensive covers almost anything else that isn’t a collision, including theft and vandalism.
So, for example, if you hit another car and you’re at fault, damage to the other car or its occupants would be covered by your liability insurance, but repairs to your car would only be covered if you have collision insurance. Without it, you would be on your own to repair or replace your car.
Similarly, in most provinces, if somebody hits you and they’re entirely at fault, your basic policy will usually cover you – but only if the car that hits you has liability insurance, de Pruis said.
So, if they don’t have insurance or if it’s a hit-and-run and you don’t know whether they have insurance, the damage will only be covered if you have collision insurance and you’ll have to pay the deductible, de Pruis said.
For instance, if the repairs cost $1,800 and your collision deductible is $1,000, your insurance company would cover $800.
If you can’t prove who hit you, it’s treated like a hit-and-run.
But if your insurance company can prove who was driving, and if the person has valid insurance, then it will recover the costs from the other company and cover your deductible.
This applies in provinces with no-fault insurance, also known as Direct Compensation Property Damage (DCPD), where your insurance company covers the damage to your vehicle.
Generally, DCPD only applies if the at-fault driver has liability insurance, de Pruis said.
Your word against theirs?
So how does your insurance company prove that someone hit you when they deny it?
“A description of the driver could be helpful to validate the person’s identity – a friend could have borrowed the vehicle when the vehicle owner was out of town,” de Pruis said.
If you took photos of the driver’s insurance pink slip and driver’s licence on a phone, the files usually show a date and location.
Some insurers have their own special investigation units (SIU) that could obtain written statements from the drivers, talk to witnesses and investigate the alibi of the driver who states they were not at the scene, de Pruis said.
If you weren’t required to file a police report – in Ontario, you only have to report a collision if someone is injured, there’s damage of more than $2,000 or there’s damage to private or government property – you could file one now, de Pruis said. Then, police may also investigate.
Still, the best way to discourage someone from lying about a collision is to get as much information as possible at the scene.
Even if you don’t have a dash cam, get photos of the damage, the other vehicle, the location, and the driver’s licence and insurance information, de Pruis said. Also, get contact information from any witnesses.
Have a driving question? Send it to globedrive@globeandmail.com and put ‘Driving Concerns’ in your subject line. Emails without the correct subject line may not be answered. Canada’s a big place, so let us know where you are so we can find the answer for your city and province.