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Auto Accident May Affect Your Credit - Medical Bills, Disputed Liability, Collections

How An Auto Accident Can Hurt Your Credit

Last Updated: July 19, 2016

If being hurt in an auto accident isn't bad enough, you may be doubly-challenged by the financial implications. Not only may you miss work (and a paycheck or more), but you may also find yourself responsible for unexpected medical bills. As with any other type of debt, when not handled promptly and appropriately, your credit can take a big hit.

Are Auto Accidents Reported to the Credit Bureaus?

No, auto accidents have no bearing on your credit history or credit worthiness. Auto accidents are not reported to credit bureaus or listed anywhere on your credit report.

Can an Auto Accident Ruin My Credit?

In and of themselves, auto accidents do not affect your credit one way or the other. It is only the debt associated with auto accidents that can get you into trouble, if:

  1. You have both auto and health insurance requiring coordination of benefits that somehow gets complicated.
  2. Neither an auto nor health insurance policy covers your medical bills, leaving you personally responsible for the debt, but you fail to make acceptable payment arrangements.

Either way, worst-case scenario is your unpaid medical bills get sent to a collection agency.

What is Coordination of Benefits?

If you have both auto and health insurance through different companies, then coordination is required between them to determine which policy has primary responsibility for the debt, as well as what (if any) coverage the other policy may provide.

Possible Complications During The Coordination of Benefits Process

During the coordination of benefits process, there is potential for trouble if:

Worst-case scenario, these complications mean your medical bills go unpaid by either of your insurance companies.

Will My Health Care Provider Allow a Grace Period for Payment While the Insurance Companies Sort Out Liability?

While it's no surprise to health care providers that auto accident coverage can be a complicated process, there is no set, formal grace period you will be allowed while your insurance companies sort things out. That said, your personal contact with their billing department can go a long way. Keep them in the loop of what's happening and you could buy yourself some time. Frequent contact throughout the process can help insure you're not sent to a collection agency unexpectedly and can, instead, make necessary payment arrangements to keep you in good standing.

How to Prevent Complications Associated with the Coordination of Benefits Process

If you have both auto and heath insurance:

866.785.9884 Call for a FREE credit repair consultation from Lexington Law

If the Claims Process is Taking Longer Than My Health Care Providers are Willing to Wait, How Can I Avoid Being Sent to Collections?

If you have insurance coverage, never give up the claim. Keep at it and keep on them, often! At the same time, keep your health care providers in the loop, making every effort you can to delay collection. If and when it can be delayed no more, and the claim has yet to be settled, it is in your best credit interest to bite the bullet and make a payment arrangement if it means keeping you from being turned over to a collection agency.

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