Getting into a car accident can be devastating. You can lose your car and risk potential injuries that can be life-altering. Unfortunately, along with the physical challenges that a car accident throws into your life, it also creates financial issues. An accident can be one of the most costly expenses that you never see coming and that most people aren’t prepared for.
So, what are the ways that a car accident can impact your finances?
Legal Fees
Lawyers like to advertise about the large settlements they get their clients after an accident. This, of course, is provided that the client isn’t at fault for the accident. If you’re more than 50% at fault for the crash, then you’re not entitled to recover any damages. In the case when you’re more than 50% at fault, you still may need a lawyer, and hiring legal counsel can become very costly in short order. Even if you’re not at fault, you’re going to still have legal fees to pay at the end of the process.
Medical Payments
Depending on the severity of your crash, there is a good chance that you walk away with injuries that require medical attention. These injuries aren’t always traumatic, but they can force you to go to the emergency room. Something as small as whiplash can become very expensive, as you will need to go to a chiropractor or physical therapist to treat your back and neck pain. So, when you have injuries, insurance may cover some of the cost, but it may be expensive no matter what that injury is.
Insurance Payment Increase
After a car accident, you can expect your insurance payments to increase. The monthly cost of your car insurance will jump, throwing a tight budget into turmoil. Furthermore, if you need to use your medical insurance after the accident for one reason or another, then that is likely to increase, too. In a lot of ways, this makes insurance increases the hidden or surprise expense of a car accident that doesn’t go away. Truck drivers, of whom there are 3.5 million in the United States, in particular, can face difficulties with their insurance after an accident.
Vehicle Repairs
Insurance may cover some of the damage to your vehicle, but they rarely cover all of it. This means that you’ll be paying for at least some of the damage. This may include taking out dents, replacing glass, and fixing electrical panels. In the case of a severe crash, your car might even be totaled. This will force you to go out and buy a new car. You may not be ready to pay for a down payment on a new car.
Losing the Ability to Work
Most people don’t think about it, but a car accident can take away your ability to work. If you’re injured, then you won’t be able to go to work. While disability pay will help during the time that you’re recovering, this can still be devastating for anyone who lives paycheck to paycheck or without a nest egg of some kind. From there, losing the ability to work for any period of time can impact your family around you. If your child needs braces, as four million Americans are wearing them at any given time, they may not be able to get them to straighten their teeth because of the economic impact of losing time at work.
There is no way to know if or when you’ll be in an accident. That’s why you need to always be prepared for situations like this. This means that you’ll want to save money for an emergency, consider money management tips, and know the steps to take if a car accident takes place.