Do Auto Body Shops Report Damage to Insurance?

Regardless of whatever way your vehicle got damaged, once you bring it into the auto body shop for repairing, can they report the damage to your insurance company? If so, do they report it on their own, or do they need some kind of approval from you?

Also, who initiates the damage report to your insurer? The auto body shop, your insurance company adjuster or you? What happens when you choose to pay out of pocket? This article answers all the questions with detailed answers so that you are aware of the actions and limitations of auto body shops when it comes to your insurance.

When Do Auto Body Shops Report Damage to Insurance?

Yes, auto body shops can report damage to your insurance company. But they wouldn’t or can’t just do it out of the blue. The auto body shop would require your consent, or can only do so, if there are certain legal and insurance policy requirements.

So, based on these criteria, auto body shops report damage to an insurer based on the following outcomes.

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Customer’s Claims to Pay Using Auto Insurance

As the customer, you can claim to pay using your auto insurance. So, based on your request the auto body shop will contact your insurer to facilitate the auto insurance claim.

They will send the invoice, and payment instructions to your auto insurance company to have the payment processed and provide the details of the repair/replacement costs incurred for your vehicle.

Legal and Policy Requirements

It is mandatory for auto repair shops to abide by local state laws. If you have auto insurance, and if you’re willing to use it to cover the maintenance costs of your vehicle, then it can be a legal and policy requirement for the auto repair shop to actively communicate and report to your insurer.

Auto insurance frauds are very common in the USA. According to NICB, 10% of all property-damage insurance claims are fraudulent, this also includes auto insurance. So, that’s why auto repair shops are legally required and responsible to report transparently to your insurer.

Vehicle Comes Under Warranty Policies

If your vehicle comes with any type of repair or replacement warranty, whether it covers a substantial parts repair cost, the replacement of certain parts, or the whole vehicle within a specified period, it needs to be reported to the insurance company.

This is mainly essential because your insurer needs to determine the coverage required under your auto insurance policy excluding any expenses covered by the vehicle’s warranty.

Typically, warranties are provided by the auto dealership, or the car manufacturer, so any expense that’s not covered within the warranty policies can be covered from your auto insurance policy based on your coverage limits.

So, if your vehicle comes under a warranty, it is essential for the auto body repair shop to specify the costs that are covered by the warranty policies, and the costs that are required from your auto insurance policy.

Insurance Company Adjuster Investigates the Claim

After the auto insurance is claimed, your insurer will assign an insurance adjuster to investigate and verify the legitimacy of the claim. So, the adjuster will contact your auto body repair shop to figure out the validity of your auto insurance claim, and the amount of cost that needs to be covered.

So, that’s when the auto body repair shop must comply with the adjuster by providing invoices, and information. The entire verification process requires the auto body repair shop to report to the adjuster and your insurer.

Based on the investigation, if your auto insurance claim turns out to the legit, and if it complies with the terms and conditions of your insurance policy then your vehicle’s maintenance costs will be covered by your insurer.

Do Auto Body Shops Report to Insurance for Out-of-Pocket Payments?

No, if you’re paying for your vehicle’s expenses out of pocket, then there’s no need for the auto body shop to contact your insurer. The only reason the auto body shop needs to contact your auto insurance company is if the costs are being covered by the insurance company.

Also, it when it comes to the concern of legal responsibilities, the auto body shop is only needs to report to your insurer to ensure that they are not involved with any fraudulent insurance claim, and to comply with the processes based on your auto insurance policy.

So, if you’re paying for the vehicle’s repair costs out of your own pocket, then the auto body shop is only committed to report directly to you.

Bottomline

In a nutshell, it’s up to you whether the auto body shop should contact and report to your insurer. If you’re paying for the vehicle’s maintenance costs using your auto insurance policy only then the auto body shop needs to report to your insurer.

If you’re bearing the vehicle’s maintenance costs out of your own pocket, or if it’s covered by a warranty policy then the auto body shop will only report to you, as there’s no need to contact your insurer.

There are times it can get confusing especially if you’re concerned with the communication between the auto body shop and your insurer. In that case, you can contact us for suggestions or help you with practical guidelines to smoothly deal with the entire process.

FAQs

Under what circumstances do auto body shops report damage to insurance companies?

The auto body shop will only report to your insurer when you claim the auto insurance and inform the auto body shop that the maintenance cost will be covered by your insurer.

Will an auto body shop notify my insurance about hidden damages found during repairs?

If the repair is already under an insurance claim, the shop may communicate directly with the insurer about additional damages for approval. If no claim has been filed, they won’t report it unless you ask them to.

If I don’t claim auto insurance, will the auto body shop still repair my car?

Yes, the auto repair shop will still repair your car regardless of whether it’s covered by insurance, or out of your own pocket.