6 Ways A Car Accident Affects Your Finances

6 Ways A Car Accident Affects Your Finances

When you are in a car accident, it can be very stressful and overwhelming. You may be dealing with pain and injuries, which will cause you to miss work and the stress that comes with financial problems.

If you are hurt or have lost a family member in a car accident, you are probably worried about your finances. The very first thing that you need to do is contact an experienced personal injury attorney to make sure that your legal rights are protected. You should learn how to hire the best lawyer for your case.

The most immediate cost of a car accident is the medical bills that result from one. In addition to the physical injuries that occur after a wreck, there can be emotional effects, such as anxiety or post-traumatic stress disorder. You may also need therapy or medications to help you deal with these issues.

Other costs associated with a car accident include funeral expenses if someone is killed in the crash and property damage costs for both vehicles involved.

Suppose you have been injured in a car accident. In that case, it is crucial for you to know your rights under personal injury law and how to settle the medical bills and other expenses associated with the accident. Learn more about car accidents by reading on!

The Financial Impact of a Car Accident

The financial impact of a car accident can be substantial. Depending on the people involved, the costs can range from a few thousand dollars to several hundred thousand.

A major problem when estimating the costs of an accident is that there are so many variables involved. The cost of an accident might depend on the cost of the car, how long it takes to repair the car and whether there’s bodily injury involved.

In addition, in some states, if you’re hit while parked, and your car is damaged, you can file a claim with your insurance company.

The financial impact on victims of auto accidents varies widely depending upon the severity of their injuries, but here are some costs that are typically associated with car wrecks:

Property Damage or Loss

This is what happens when your car sustains damage in an accident. For example, if you hit a large pothole at 30 miles per hour and total your $20,000 BMW, you’ve lost $20,000 worth of property. If you have comprehensive coverage, this cost will be covered by your insurance company. If not, you’ll have to pay for the repairs yourself.

Insurance Deductibles

The insurance deductible is the portion of your claim that comes out of your own pocket. If you have collision coverage with a $500 deductible, you will pay $500 toward any damage to your vehicle regardless of fault. In some states, your insurance company will set this deductible; in others (such as Arizona), you’ll choose it when applying for coverage.

Mediation or Arbitration Costs

If you file a claim with your insurance company after an accident and it isn’t settled in your favor, both sides will probably agree to mediation or arbitration — outside help to decide how much each party owes the other. This happens at an additional cost and can run into the thousands.

financial cost of accident

Medical Costs

Medical expenses have a tendency to pile up quickly and can be the most expensive component of any car accident.

You can’t predict the extent of your injuries until a doctor or medical professional assesses them, but if you do suffer serious injury or illness, know that you may need to pay for care for months or even years down the road.

Completing treatment for a broken bone is just the beginning; going back repeatedly for checkups and evaluations is also part of this process.

Accident victims may also face additional costs because their treatment delays appointments for more routine medical needs such as physicals, dental visits, and annual checkups.

Lost Income Due to Missed Work

If you’ve missed work because of injuries sustained in a wreck, you can file a claim against the negligent driver’s insurance company for lost income and wages.

You’d need documentation from your employer detailing how much money you would have made during that time period if you hadn’t been injured.

Remember: You must include what you would have done overtime or through bonuses if they are part of your compensation package.

Long-Term Rehabilitation Expenses

Rehabilitation costs can vary greatly depending on the severity of your injury. For minor injuries like soft tissue damage or whiplash, you might need only two or three sessions with a chiropractor or physical therapist to treat your pain and swelling. However, serious cases can require months of rehabilitation treatment to heal properly.

Long-term rehabilitation is the process of recovering from an injury or sickness that may take months or years to fully overcome. This can be due to a variety of reasons, such as a traumatic brain injury, stroke, or illness.

While the government provides many resources for helping people pay for medical bills after an injury, there are no programs in place to help with long-term rehabilitation costs.

These expenses can be substantial, and without a plan to cover them, anyone involved in an accident could suffer financially for years to come.

For many people, a car accident can be a traumatic experience. Even if you’re not in the hospital, you could still have lasting injuries from a car crash that require long-term rehabilitation.

These expenses are often overlooked when settling injuries and damages, but they are just as important as the medical bills you still have to pay off.

Final Reminder on Ways a Car Accident Affects Your Finances

By taking a proactive approach to dealing with all aspects of your financial life post-accident, you can mitigate the accident’s impact on your finances.

You will definitely change after an accident, and it might not be for the better. But if you do everything possible to protect yourself from a negative financial outcome and to recover from your injuries as quickly as possible—both physically and financially—you can reduce the emotional trauma of being involved in a car accident and leave you better prepared to take steps towards recovery.

The Author

Jason M. Ferguson, the founder of Ferguson Law Group, started his career working for an automobile insurance company as a trial attorney before owning his injury law firm for over 20 years. Attorney Ferguson has a unique experience, having tried cases on both sides of the court system in personal injury trials, unlike many other lawyers. Ferguson also served over 14 years as an Army Reserve officer and the Georgia Air National Guard. The Albany Herald recognized him as one of southwest Georgia’s “40 under 40” in 2010

 

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