Automobile Accidents: Who Pays What?
You’re out driving in your car. Some friends or family could be with you. Perhaps it’s just you alone. Maybe you’re going to the store for groceries or picking your children up from school. During this time the unthinkable happens: your car runs into another vehicle on road, resulting in an “accident”, or more accurately, a traffic collision. Typically your first thought is going to be if everyone is safe and free from harm. After this, it’s usually who’s going to pay for the damages. Just like with dealing with injuries, the latter can be a fairly complicated and painful subject. Essentially what it boils down to is the type of insurance coverage (or lack there of) each party has, and ultimately who is deemed “at fault”.
Types of Damages
In the realm of car accidents, there are usually two types of damages involved. Property damage and bodily injuries. In insurance terms, property damage is generally considered damage caused to your car or to another. Bodily injuries are damages that are caused to the occupants of the cars or people involved in the collision. How each one is paid for is determined by the type of insurance each party involved has. The following scenarios detail, in general, who pays what and how much after a car accident.
Another Insured Driver is at Fault
In this case, if the other party’s insurance deems the accident to be their driver’s fault, then they pay the property damage associated with your vehicle. They are also obligated to pay medical bills associated to you in the accident.
The amount that their insurance can pay you for your car depends on the value of the vehicle. If a car would require more money to be repaired than it is worth, then it is deemed “totaled” and you’re simply paid the value of the car according to the insurance adjuster. As a specific example, if your car is valued at $5,000 yet repairs to it would cost more than this, it would be totaled and you would only get a check for $5,000.
Another Uninsured Driver is at Fault
In this example, the other driver is at fault and either doesn’t have insurance or flees the scene (hit and run). Depending on the policy you have, your coverage may vary. Most insurance companies will allow their driver to purchase a clause which protects them from this type of situation. If you yourself also do not have insurance you may wind up paying the costs if the driver isn’t found. If it is agreed that the other person is at fault and they do not have coverage, then getting them to pay you may prove to be difficult. The best course of action in this case may be to seek an attorney.
You have Insurance and You Are at Fault
Since most states require drivers to have a minimum of liability insurance, your insurance will pay the other party’s property and bodily damages based on your coverage. It’s important to know what exactly the limits are in your policy. Most policies will specify the maximum your insurance will pay for damages. If their medical bills or car repairs exceed what is covered by your policy, then you will be financially liable for the difference.
If you have strictly liability insurance, then the damage incurred to your own person and vehicle will not be covered if you are at fault. “Collision” insurance will pay for repairs to your car as the result of a car accident no matter who is at fault up to an amount maximum specified by your policy. Usually a person will have to pay a deductible before the insurance starts paying. Let’s say you incur $5,000 dollars worth of damage to your vehicle and your deductible is $500 dollars. Your insurance would wind up paying $4,500 dollars after your initial $500 dollar amount. Generally, having a lower deductible results in a higher monthly insurance premium.
You Do Not Have Insurance and Are at Fault
In almost all states it is against the law to operate a vehicle without insurance. If you’re uninsured and involved in a car accident where you are at fault, then you are solely responsible for all damages associated with the incident. Additionally, there may be law enforcement action taken against you as a result of being uninsured.