Home Leisure & Lifestyle The Long-Term Financial Impacts of Car Accidents

The Long-Term Financial Impacts of Car Accidents

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Passenger vehicles are safer than they’ve ever been, but motor vehicle crashes still happen every day. People involved in these accidents suffer psychological and physical consequences, but there are also financial consequences. You might have immediate economic effects, such as repairing or replacing your vehicle. However, you should know about several long-term financial repercussions and be prepared for them.

Higher car insurance premiums

Even after the initial crash costs are tallied, you may wind up with higher insurance premiums for your car. If you’re the at-fault driver, this is nearly certain to happen. Unfortunately, your rates might increase in many states, even if you’re not at fault. Premium increases vary based on the insurance carrier, the facts of the accident, and how much your claim costs them. This is one case where shopping for a new car insurance provider pays off before your next renewal. Your next policy provider might penalise you less for the accident.

Property damage or value

Even if you immediately pay for your vehicle to be fixed enough to be roadworthy again, its value might never recover. That can lower the resale value if you try to sell it or trade it in for a new set of wheels. If your car is totaled and the vehicle value is less than what’s left on your car loan, you might have to pay the difference out of your pocket.

Lost income

Minor car accident injuries might be short-term interruptions to your life; still, long-term injuries and permanent disability can impact your ability to work like you did before or even prevent you from going back to your previous employment position. Losing earning capacity of any level profoundly impacts your future, ranging from reducing your current income to altering your potential earnings and career path. Calculations for this loss are complicated and usually involve professionals who can make the determinations.

Ongoing rehab and treatment

If your injuries become ongoing issues, you may need rehabilitation, therapy, and surgeries as part of your continuing medical care. Even just dealing with chronic pain can mean routine appointments. The lifetime medical expenses of someone who suffers a traumatic brain injury can reach into the millions.

Mental impact

Being involved in any car accident can be a jarring experience, but the shock of it is often acute and only lasts for a few days. However, serious accidents might have longer-running psychological and emotional effects. If you have trouble coping with these, they can have potential financial implications ranging from bills for medication and therapy to lost productivity in life and at work.

Loss of services

You provide your household with more than just income. Depending on your living circumstances, you might cook, clean or care for children in your family. If you cannot continue performing these tasks following an accident, your family might need outside help to fill the void left behind; hiring external help can get expensive quickly.

Renovations

Another potential long-term financial cost of accident injuries is modifying your home. If you suddenly need a wheelchair, then hallways and doors might need widening or ramps. These construction costs involved are a responsibility you probably aren’t planning on.

Credit card bills

You may decide to use credit cards to cover immediate expenses after a car accident. With high interest rates, you may find yourself quickly swimming in debt. You or your lawyer may be able to negotiate with your credit card company for better rates or payment plans until you receive compensation for your accident.

Consider seeking compensation

The long-term financial impact of car accidents can erode your future stability and security. If someone else was at fault for the accident that impacted you, consider pursuing your rights to compensation from them and their insurance. No matter how good your insurance coverage is, how safe your car is, or how defensively you drive, a car accident can interrupt your life any hour, day or night.




Ellen Diamond, a psychology graduate from the University of Hertfordshire, has a keen interest in the fields of mental health, wellness, and lifestyle. 

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