Sam was involved in a car accident. The other driver asks to settle now; what should Sam do?

• A. Settle with the other driver
• B. Ignore the situation
• C. Decline because of cooperation provisions
• D. Consult an attorney

Answer: (C)

Cooperation provisions require you to work with your insurer and not settle a claim directly with the other driver. By declining to settle on your own, you’re following the policy terms that protect both your coverage and the integrity of the claims process. The insured should promptly notify their insurer about the accident, provide all requested information, and let the insurer handle any negotiations or settlements.

If there are injuries or significant damages, consulting an attorney can be wise, but the immediate action that aligns with the policy is to decline a direct settlement and involve the insurer first. This helps ensure that any settlement is properly documented and covered under the policy, and it avoids potential pitfalls that could jeopardize coverage.