The at-fault driver’s insurance pays for car accident damages in most states. The driver who caused the crash must use their liability insurance to cover the other person’s medical bills, lost wages, and vehicle repairs. Twelve states have “no-fault” rules where each driver’s own insurance pays for their injuries first—regardless of who caused the crash.
Under federal and state insurance laws, all drivers must carry minimum liability coverage. The specific rule that creates problems is the Financial Responsibility Law that each state enforces. This law requires drivers to prove they can pay for damages they cause. The negative consequence? If you cause an accident without proper coverage, you face license suspension, fines up to $5,000, and personal liability for all damages.
The National Highway Traffic Safety Administration reports an estimated 17,140 people died in motor vehicle crashes in the first half of 2025 alone. Many accident victims find themselves confused about which insurance policy should pay for their losses.
Here’s what you will learn in this article:
- 🚗 How to identify which insurance policy covers your specific type of accident and get your claim processed faster
- 💰 The exact difference between fault and no-fault states so you know where to file your claim
- ⚠️ Critical mistakes that cause insurance companies to deny or reduce claims by 40% or more
- 📋 Step-by-step instructions for filing claims correctly with the right insurance company
- ⚖️ When you must hire a lawyer versus when you can handle the claim yourself
How At-Fault Insurance States Handle Car Accident Claims
At-fault states make the driver who caused the crash financially responsible for all damages. These states are also called “tort states” because victims can sue the negligent driver. The at-fault driver’s liability insurance pays for the victim’s medical expenses, property damage, and other losses.
Thirty-eight states follow at-fault rules for handling car accident claims. The insurance company investigates the crash and decides who bears responsibility. If you are the victim, you file a claim against the at-fault driver’s insurance company—not your own.
The at-fault driver’s insurance includes two main parts. Bodily injury liability covers the victim’s medical treatment, hospital stays, rehabilitation, and lost wages. Property damage liability pays to repair or replace the victim’s vehicle and any other damaged property.
| At-Fault State Insurance | What It Covers |
|---|---|
| Bodily injury liability | Medical bills, lost wages, pain and suffering for others |
| Property damage liability | Vehicle repairs, damaged property, rental car costs |
Insurance companies assign claims adjusters to investigate accidents and determine fault. The adjuster reviews police reports, photographs of vehicle damage, witness statements, and traffic laws. They look at where the damage appears on each vehicle to understand how the collision happened.
The problem with at-fault states? Proving fault can take weeks or months. The victim must wait for the investigation before receiving payment. If the at-fault driver disputes responsibility, the victim may need to file a lawsuit.
What Happens When the At-Fault Driver’s Insurance Runs Out
Insurance policies have maximum payout limits that cap how much they will pay. A driver with 30/60/15 coverage has $30,000 per person for injuries, $60,000 total per accident, and $15,000 for property damage. If your medical bills exceed $30,000, the at-fault driver’s policy will not cover the rest.
You have two options when the at-fault driver’s coverage falls short. First, you can file a claim under your own underinsured motorist coverage if you purchased this protection. Second, you can sue the at-fault driver personally for the remaining amount.
Texas law requires only $30,000/$60,000/$25,000 in minimum coverage—often called the “liability trap.” A single hospital visit can easily exceed these limits. Victims of serious crashes may recover only a fraction of their actual losses if the at-fault driver carries minimum coverage.
| State Minimum Coverage Examples | Bodily Injury (Per Person/Per Accident) | Property Damage |
|---|---|---|
| Texas | $30,000/$60,000 | $25,000 |
| California (2025) | $30,000/$60,000 | $15,000 |
| Georgia | $25,000/$50,000 | $25,000 |
| North Carolina (July 2025) | $50,000/$100,000 | $50,000 |
No-Fault Insurance States: A Different System Entirely
No-fault states require each driver to use their own insurance for medical bills and lost wages—regardless of who caused the accident. Twelve states operate under no-fault laws: Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania, and Utah.
The key coverage in no-fault states is Personal Injury Protection (PIP). PIP pays for your medical expenses, rehabilitation, lost income, and essential services like childcare while you recover. You file a claim with your own insurance company immediately after the accident.
The advantage of no-fault insurance is speed. Victims receive payment quickly without waiting for fault investigations. The disadvantage is that PIP limits are often low. New York requires $50,000 in PIP coverage, but Michigan allows drivers to choose coverage from $50,000 up to unlimited.
| No-Fault State | Minimum PIP Requirement |
|---|---|
| Florida | $10,000 |
| Massachusetts | $8,000 per person |
| Michigan | $50,000 to unlimited (driver’s choice) |
| Minnesota | $40,000 ($20,000 medical, $20,000 non-medical) |
| New York | $50,000 |
| Utah | $3,000 |
When You Can Sue in a No-Fault State
No-fault states limit your right to sue the at-fault driver—but exceptions exist. Most states allow lawsuits when injuries meet a “serious injury threshold” defined by state law. This threshold varies by state and may include permanent disfigurement, significant scarring, loss of body function, or medical bills exceeding a specific dollar amount.
Property damage works differently. Even in no-fault states, the at-fault driver’s insurance pays for vehicle damage. No-fault rules apply only to bodily injury claims. The at-fault driver remains responsible for repairing your car.
Three states offer choice no-fault insurance: Kentucky, New Jersey, and Pennsylvania. Drivers in these states choose between no-fault coverage and traditional liability coverage when purchasing a policy. Those who select “limited tort” pay lower premiums but give up the right to sue for non-economic damages like pain and suffering.
The Six Types of Car Insurance That Pay After an Accident
Understanding each type of coverage helps you identify which insurance policy applies to your situation. Not all drivers carry every type of coverage. The coverage you purchased and the coverage the other driver purchased both matter.
Liability Insurance: Required in Every State
Liability insurance pays other people when you cause an accident—it does not pay for your own injuries or vehicle damage. All states except New Hampshire require liability coverage, though required minimums vary widely.
Liability coverage has two components. Bodily injury liability covers medical costs, lost wages, and pain and suffering for people you injure. Property damage liability covers repairs to other vehicles, buildings, fences, or any property you damage in an accident.
| Liability Coverage | Who It Pays | What It Covers |
|---|---|---|
| Bodily injury liability | Other people you injure | Medical bills, lost wages, pain/suffering, legal fees |
| Property damage liability | Other people’s property | Vehicle repairs, building damage, fences, utility poles |
Collision Insurance: Pays for Your Vehicle Damage
Collision insurance covers damage to your vehicle from accidents involving other cars or objects. This coverage pays regardless of who caused the crash. If you hit another car, a tree, a guardrail, or roll your vehicle—collision insurance applies.
You must pay a deductible before collision coverage kicks in. Common deductibles range from $250 to $1,000. Higher deductibles mean lower monthly premiums. Collision coverage is optional unless you have a car loan or lease.
Comprehensive Insurance: Covers Non-Collision Events
Comprehensive coverage protects your vehicle from everything except collisions. This includes theft, vandalism, weather damage, falling objects, fire, and animal strikes. If a deer runs into your car or hail damages your roof, comprehensive coverage pays.
Many drivers confuse collision and comprehensive. The easy rule: collision = you hit something; comprehensive = something happens to your car. A tree falling on your parked car is comprehensive. Backing into a tree is collision.
| Coverage Type | What It Covers | Examples |
|---|---|---|
| Collision | Accidents involving impact | Hitting another car, hitting a pole, rollover |
| Comprehensive | Non-collision incidents | Theft, hail, fire, vandalism, deer strike |
Personal Injury Protection (PIP): No-Fault Medical Coverage
PIP pays for your medical expenses regardless of fault. PIP is required in the 12 no-fault states and available as optional coverage in others. PIP covers medical bills, ambulance fees, rehabilitation, lost wages, and sometimes funeral expenses.
PIP differs from health insurance in important ways. PIP pays immediately without waiting for fault determination. It covers accident-related expenses that health insurance might exclude. PIP also covers passengers in your vehicle and may cover you as a pedestrian if a car hits you.
Medical Payments Coverage (MedPay): Fills Insurance Gaps
MedPay is similar to PIP but offers narrower coverage. MedPay pays medical expenses for you and your passengers after an accident, regardless of fault. Unlike PIP, MedPay does not cover lost wages or essential services.
MedPay helps cover health insurance deductibles and copays from accident-related treatment. If you have a $5,000 health insurance deductible, MedPay can pay that amount. MedPay typically ranges from $1,000 to $25,000 in coverage.
Uninsured/Underinsured Motorist Coverage (UM/UIM): Your Safety Net
About 15% of drivers have no insurance at all. Uninsured motorist coverage (UM) protects you when the at-fault driver has no insurance. Underinsured motorist coverage (UIM) pays when the at-fault driver’s policy limits are too low to cover your damages.
UM/UIM coverage is required in some states and optional in others. Georgia law requires insurers to offer UM/UIM coverage, but drivers can reject it in writing. Insurance experts recommend carrying UM/UIM limits of at least $100,000/$300,000.
| UM/UIM Scenario | Which Coverage Applies |
|---|---|
| At-fault driver has no insurance | Uninsured motorist (UM) |
| At-fault driver’s limits are too low | Underinsured motorist (UIM) |
| Hit-and-run driver cannot be found | Uninsured motorist (UM) |
Whose Insurance Pays in Common Accident Scenarios
Different accident situations trigger different insurance policies. The examples below show exactly which insurance applies in each scenario.
Scenario 1: Standard Two-Car Accident in an At-Fault State
Maria is driving through an intersection when Jake runs a red light and hits her car. Jake is clearly at fault for violating traffic law. Maria suffers whiplash and $15,000 in medical bills. Her car needs $8,000 in repairs.
| Step | Which Insurance | What It Pays |
|---|---|---|
| Maria’s medical bills | Jake’s bodily injury liability | Up to Jake’s policy limit |
| Maria’s car repairs | Jake’s property damage liability | Up to Jake’s policy limit |
| Jake’s medical bills | Jake’s own health insurance or MedPay | Jake pays for his own injuries |
| Jake’s car repairs | Jake’s collision coverage (if he has it) | Jake pays his deductible |
Maria files a claim with Jake’s insurance company. If Jake carries Texas minimum coverage (30/60/25), his bodily injury liability covers Maria’s $15,000 medical bills. His property damage liability covers her $8,000 in car repairs. Jake must pay for his own injuries and vehicle damage.
Scenario 2: Two-Car Accident in a No-Fault State (New York)
David rear-ends Patricia at a stoplight in Buffalo, New York. David is at fault. Patricia has neck pain and $6,000 in medical bills. Her car suffers $5,000 in damage.
| Step | Which Insurance | What It Pays |
|---|---|---|
| Patricia’s medical bills | Patricia’s PIP coverage | Up to $50,000 (NY minimum) |
| Patricia’s car repairs | David’s property damage liability | Up to David’s policy limit |
| David’s medical bills | David’s PIP coverage | Up to his policy limit |
In New York’s no-fault system, Patricia files with her own insurance for medical expenses. Her PIP coverage pays $6,000 for treatment. She does not file a medical claim against David. However, David’s insurance does pay for Patricia’s vehicle repairs because property damage still follows at-fault rules.
Scenario 3: Hit-and-Run Accident
Carlos is driving home when another car sidesides him and flees the scene. Carlos cannot identify the other driver. He has $4,000 in medical bills and $6,000 in vehicle damage.
Hit-and-run accidents trigger your own insurance coverage because the at-fault driver cannot be found. Carlos files claims under his own policy:
| Coverage | What It Pays |
|---|---|
| Uninsured motorist bodily injury (UMBI) | Carlos’s medical bills |
| Uninsured motorist property damage (UMPD) or Collision | Carlos’s vehicle repairs |
| MedPay or PIP (if he has it) | Additional medical expenses |
If Carlos has collision coverage, he can use that for vehicle repairs but must pay his deductible. Many states treat hit-and-run drivers as “uninsured” for UM claims purposes.
Scenario 4: Accident in a Borrowed Car
Stephanie borrows her friend Kevin’s car to run errands. She rear-ends another vehicle while distracted. The other driver has $12,000 in injuries. Kevin’s car has $7,000 in damage.
Car insurance generally follows the car, not the driver. Kevin’s insurance is primary coverage because Stephanie had his permission to drive.
| Damage | Primary Insurance | Secondary Insurance |
|---|---|---|
| Other driver’s injuries | Kevin’s bodily injury liability | Stephanie’s liability (if Kevin’s is insufficient) |
| Other driver’s car | Kevin’s property damage liability | Stephanie’s liability (if Kevin’s is insufficient) |
| Kevin’s car damage | Kevin’s collision coverage | None |
Kevin’s insurance rates may increase even though he wasn’t driving. If Stephanie caused damages exceeding Kevin’s policy limits, Stephanie’s own liability insurance may provide additional coverage.
Scenario 5: Rental Car Accident
Michael rents a car for a business trip and backs into a pole in the parking garage. The rental car has $3,000 in damage. No other vehicles are involved.
Your personal car insurance often extends to rental cars. Michael’s collision coverage (if he has it) pays for the rental car damage minus his deductible. If Michael declined the rental company’s coverage and has no personal collision insurance, he pays out of pocket.
| Coverage Source | What It May Cover |
|---|---|
| Michael’s personal collision coverage | Rental car damage (minus deductible) |
| Michael’s personal liability | Damage to other vehicles or property |
| Rental company’s CDW/LDW (if purchased) | Rental car damage (no deductible) |
| Credit card rental coverage | May provide primary or secondary coverage |
Many credit cards offer rental car coverage as a cardholder benefit. Check your card terms—some provide primary coverage (pays first) while others offer secondary coverage (pays after your personal insurance).
Scenario 6: Rideshare (Uber/Lyft) Accident
Rideshare insurance is complicated because coverage depends on what the driver was doing at the moment of the crash. Both Uber and Lyft provide tiered insurance coverage based on the driver’s status.
| Driver Status | Uber/Lyft Coverage |
|---|---|
| App off | Driver’s personal insurance only |
| App on, waiting for ride request | $50,000 per person/$100,000 per accident bodily injury, $25,000 property damage |
| En route to pickup or with passenger | $1,000,000 liability coverage |
Example: Jessica is riding in an Uber when the driver runs a stop sign and hits another car. Jessica has $25,000 in injuries. Since the driver was transporting a passenger, Uber’s $1,000,000 liability policy applies. Jessica files a claim against Uber’s insurance.
If a third-party driver (not the Uber/Lyft driver) causes the accident, Jessica first uses her own UM/UIM coverage. Uber and Lyft provide $1,000,000 in UM/UIM coverage as secondary insurance after the passenger’s own policy.
Scenario 7: Multi-Car Pileup
A three-car accident occurs on the highway. Driver A rear-ends Driver B, who is then pushed into Driver C. Drivers B and C are both injured.
Multi-car accidents often involve shared fault. Insurance adjusters investigate the chain of events to assign responsibility. Typically, the driver who initiated the chain reaction bears primary responsibility.
| Party | Likely Insurance Responsibility |
|---|---|
| Driver A (rear-ended B) | Pays for B’s injuries, B’s vehicle, C’s injuries, C’s vehicle |
| Driver B | Usually not at fault; files claim against A |
| Driver C | Usually not at fault; files claim against A |
If Driver A carries minimum coverage, the combined claims may exceed policy limits. Drivers B and C would share the available funds proportionally to their damages or according to state law.
Scenario 8: Accident with a Commercial Truck
You are hit by an 18-wheeler making a delivery. Commercial trucks carry much higher insurance limits than regular passenger vehicles because potential damages are much greater.
Federal law requires commercial trucks to carry minimum liability insurance based on cargo type:
| Cargo Type | Minimum Liability Required |
|---|---|
| Non-hazardous freight (under 10,001 lbs) | $300,000 |
| Non-hazardous freight (over 10,001 lbs) | $750,000 |
| Oil transported by carrier | $1,000,000 |
| Other hazardous materials | $5,000,000 |
Multiple parties may share liability in truck accidents: the driver, the trucking company, the cargo loading company, and the vehicle or parts manufacturer. An attorney can help identify all responsible parties and available insurance policies.
How Insurance Companies Determine Fault
The insurance adjuster’s fault determination directly impacts your compensation. Understanding this process helps you protect your claim.
Evidence That Adjusters Review
Insurance adjusters investigate accidents systematically. They gather evidence from multiple sources before making a fault decision.
| Evidence Type | What It Shows |
|---|---|
| Police report | Officer’s observations, traffic violations cited, diagram of accident |
| Vehicle damage location | How the collision occurred (front damage suggests hitting; rear damage suggests being hit) |
| Photographs | Skid marks, debris, road conditions, traffic signs |
| Witness statements | Third-party accounts of what happened |
| Traffic camera footage | Objective record of the accident sequence |
The location of vehicle damage provides critical clues. Damage to the rear of your car strongly suggests you were hit from behind. Damage to the front of the other car indicates they struck you. Adjusters use this physical evidence alongside witness accounts.
Comparative Negligence: When Both Drivers Share Fault
Most accidents are not 100% one driver’s fault. Comparative negligence rules determine how fault affects compensation when both drivers bear some responsibility.
Pure comparative negligence (13 states including California, New York, Florida): You can recover compensation even if you are 99% at fault. Your award is reduced by your percentage of fault. If you are 30% responsible and have $100,000 in damages, you receive $70,000.
Modified comparative negligence (33 states): You can recover only if your fault is below a threshold (typically 50% or 51%). If you are 51% or more at fault, you receive nothing.
Pure contributory negligence (4 states + D.C.: Alabama, Maryland, North Carolina, Virginia): If you are even 1% at fault, you cannot recover any compensation from the other driver.
| Negligence Rule | States | Effect on Recovery |
|---|---|---|
| Pure comparative | CA, NY, FL, LA, MO, and 8 others | Recover even if mostly at fault; reduced by fault percentage |
| Modified comparative (50%) | GA, TN, and others | Recover only if less than 50% at fault |
| Modified comparative (51%) | TX, IL, IN, and others | Recover only if 50% or less at fault |
| Pure contributory | AL, MD, NC, VA, D.C. | Any fault bars recovery entirely |
How to File a Car Insurance Claim Correctly
Filing your claim properly speeds up payment and protects your rights. Insurance companies process claims through specific steps you should understand.
Step 1: Document Everything at the Scene
Gather evidence immediately after the accident. Photograph the vehicles, damage, road conditions, skid marks, and traffic signs. Exchange contact and insurance information with all drivers. Get names and phone numbers from witnesses. Request the police report number.
Step 2: Seek Medical Attention Promptly
See a doctor within 24-48 hours of the accident—even if you feel fine. Adrenaline masks injuries. Delayed symptoms are common with whiplash, concussions, and internal injuries. Waiting too long creates doubt about whether the accident caused your injuries.
Step 3: Notify Your Insurance Company
Report the accident to your insurance company promptly. Most policies require “reasonable” or “prompt” notification. Provide basic facts but avoid speculating about fault or the extent of your injuries. Give accurate information—exaggerating or lying gives insurers grounds to deny your claim.
Step 4: Decide Which Claim to File
You may have multiple options for where to file your claim:
| Claim Type | When to Use It |
|---|---|
| Third-party claim (against at-fault driver) | When another driver caused the accident |
| First-party claim (your own collision coverage) | When you need faster payment or fault is unclear |
| UM/UIM claim | When at-fault driver has no insurance or insufficient coverage |
| PIP claim | In no-fault states, for your own medical expenses |
Tip: Filing with your own insurance often results in faster payment. Your insurer may then pursue subrogation against the at-fault driver’s insurance to recover costs—potentially refunding your deductible.
Step 5: Work with the Insurance Adjuster
The adjuster will contact you within one to three days. They will request details about the accident, your injuries, and your damages. The adjuster may arrange an inspection of your vehicle.
Be cautious during this process. The adjuster works for the insurance company—not for you. Stick to facts. Do not admit fault. Do not accept a settlement before you understand the full extent of your injuries.
Critical Mistakes That Destroy Car Accident Claims
Insurance companies deny 5% to 40% of auto claims depending on the type of claim and region. Many denials result from preventable mistakes.
Mistake #1: Apologizing at the Scene
Never say “I’m sorry” after an accident. Insurance companies interpret apologies as admissions of fault. Even a reflexive “I’m sorry this happened” can be twisted against you.
Mistake #2: Giving a Recorded Statement Without Preparation
The other driver’s insurance company may request a recorded statement. You are not required to provide one. If you do, prepare carefully. The adjuster will ask specific questions designed to establish your partial fault.
Mistake #3: Accepting the First Settlement Offer
Initial settlement offers are almost always too low. Insurance companies make lowball offers hoping you will accept before understanding your full damages. Medical conditions often worsen over time. Once you accept payment, you cannot request more money later.
Mistake #4: Posting About the Accident on Social Media
Insurance adjusters search social media for evidence against you. A photo of you smiling at a party can be used to argue your injuries are not serious. Do not discuss your accident, injuries, or claim on any social platform.
Mistake #5: Gaps in Medical Treatment
Skipping doctor’s appointments gives adjusters ammunition. They argue that if you were truly hurt, you would follow medical recommendations. Gaps in treatment suggest your injuries are not serious or were caused by something other than the accident.
| Mistake | Consequence |
|---|---|
| Apologizing at the scene | Interpreted as admission of fault |
| Recorded statement without preparation | Statements used to reduce your claim |
| Accepting first offer | Locked into inadequate compensation |
| Social media posts | Evidence used against you |
| Treatment gaps | Suggests injuries are minor or unrelated |
Do’s and Don’ts After a Car Accident
Do:
| Action | Why It Matters |
|---|---|
| Call 911 immediately | Creates official record; helps with fault determination |
| Document everything with photos | Visual evidence proves vehicle positions and damage |
| Exchange information calmly | You need their insurance details for your claim |
| Get medical evaluation within 24 hours | Links injuries to accident; starts treatment record |
| Report to your insurance promptly | Fulfills policy requirements; protects coverage |
Don’t:
| Action | Why It Harms Your Claim |
|---|---|
| Admit fault or apologize | Gives insurance companies basis to deny claim |
| Sign documents without reading | May waive important rights |
| Accept quick cash settlements | Releases the other driver from future liability |
| Discuss case on social media | Provides evidence for insurance to minimize claim |
| Delay medical treatment | Creates doubt about injury causation |
When You Must Hire a Car Accident Lawyer
Not every accident requires an attorney. Minor fender-benders with no injuries can often be handled directly with insurance. However, certain situations make legal representation essential.
Signs You Need a Lawyer Immediately
Hire an attorney if any of the following apply:
| Situation | Why You Need a Lawyer |
|---|---|
| You suffered serious injuries | Medical treatment and future costs require accurate valuation |
| Fault is disputed | You need someone to investigate and prove liability |
| Multiple vehicles involved | Complex fault allocation requires legal expertise |
| Insurance company denies or delays your claim | Attorney can challenge denial and negotiate |
| Settlement offer seems too low | Lawyers know fair compensation values |
| At-fault driver has no insurance | Recovery requires creative legal strategies |
| Commercial vehicle involved | Multiple liable parties; higher insurance limits require skilled negotiation |
| Loved one died in the accident | Wrongful death claims have specific legal requirements |
What a Car Accident Lawyer Does for You
A car accident attorney handles negotiations so you can focus on recovery. They investigate the accident, gather evidence, consult medical experts, and calculate your full damages. They communicate with insurance adjusters and protect you from tactics designed to minimize your claim.
Most car accident lawyers work on contingency—they receive a percentage of your settlement only if you win. You pay nothing upfront. This arrangement means the lawyer’s interests align with yours: a larger settlement benefits both of you.
Statute of Limitations: Time Limits for Legal Action
Every state sets deadlines for filing lawsuits. If you miss the statute of limitations, you lose your right to sue—forever. These deadlines apply even if you filed an insurance claim.
| Deadline Length | States |
|---|---|
| 1 year | Kentucky (personal injury), Louisiana, Tennessee (personal injury) |
| 2 years | Texas, Pennsylvania, Ohio, Georgia, many others |
| 3 years | New York, Michigan, California, Arkansas |
| 4 years | Florida, Nebraska |
| 5 years | Missouri |
| 6 years | Maine, Minnesota, North Dakota |
Do not wait until close to the deadline. Evidence disappears. Witnesses forget details. Insurance companies become less cooperative. The earlier you act, the stronger your case.
Pros and Cons of Filing Claims Against Different Insurance Sources
| Filing Option | Pros | Cons |
|---|---|---|
| At-fault driver’s insurance | Does not raise your premiums; may cover full damages | Slow process; requires proving fault; may dispute liability |
| Your collision coverage | Fast payment; no fault dispute | Your premiums may increase; must pay deductible |
| Your UM/UIM coverage | Protects when other driver uninsured/underinsured; faster than third-party claim | Uses your own policy; possible premium increase |
| Your PIP/MedPay | Immediate medical coverage; no fault required | Limited coverage amounts; does not cover property damage |
The Subrogation Process Explained
After paying your claim, your insurance company may seek reimbursement from the at-fault driver’s insurance. This process is called subrogation.
How subrogation helps you: If subrogation succeeds, your insurer may refund all or part of your deductible. Your insurer recovers their costs from the responsible party, potentially preventing premium increases.
How subrogation works:
- You file a claim with your own insurance
- Your insurer pays your claim (minus deductible)
- Your insurer investigates and identifies the at-fault party
- Your insurer seeks reimbursement from the at-fault driver’s insurance
- If successful, you may receive your deductible back
Insurers are not required to pursue subrogation in every case. Some states require insurers to notify you if they decline to subrogate. You may then pursue the at-fault driver yourself.
2025 State Insurance Law Changes You Should Know
Several states increased minimum coverage requirements in 2025:
| State | Previous Minimums | 2025 Minimums | Effective Date |
|---|---|---|---|
| California | 15/30/5 | 30/60/15 | January 1, 2025 |
| Utah | 25/65/15 | 30/65/25 | January 1, 2025 |
| Virginia | 30/60/20 | 50/100/25 | January 1, 2025 |
| North Carolina | 30/60/25 | 50/100/50 | July 1, 2025 |
| Massachusetts | 20/40/5 | Higher limits | July 1, 2025 |
These changes mean more coverage is available when you’re injured by a driver carrying minimum insurance. However, your own premiums may increase to reflect higher required limits.
FAQs
Can I sue even if I was partially at fault?
Yes, in most states. Comparative negligence laws allow recovery if your fault is below the state threshold. Your compensation is reduced by your fault percentage.
Does my insurance go up after an accident I didn’t cause?
No, typically not. Insurance companies should not raise premiums for not-at-fault accidents. Filing a claim under your collision coverage may trigger an increase in some states.
What if the at-fault driver lies about what happened?
Gather evidence. Police reports, witness statements, photos, and traffic camera footage contradict false claims. An attorney can investigate and build evidence.
Should I accept the insurance company’s first offer?
No. Initial offers are typically 30-50% below fair value. Insurance companies expect negotiation. Get a full medical evaluation before settling.
How long do I have to file an insurance claim?
Check your policy. Most require “prompt” reporting. State laws allow 1-6 years for lawsuits, but insurance claims should be filed within days.
Can I file with both my insurance and the other driver’s insurance?
Yes, in different ways. You cannot collect the same damages twice. You can file PIP/MedPay for medical bills and a liability claim against the at-fault driver for pain and suffering.
What happens if the at-fault driver has no insurance?
File a UM claim if you have uninsured motorist coverage. Otherwise, you can sue the driver personally—though collecting from uninsured individuals is difficult.
Does my insurance cover accidents in other states?
Yes. Your policy follows you anywhere in the U.S. Coverage automatically adjusts to meet the minimum requirements of the state where you’re driving.
Can I choose my own repair shop?
Yes. Insurance companies may recommend shops, but you can select any licensed repair facility. Some insurers guarantee repairs only at their preferred shops.
What if my injuries get worse after I settle?
You cannot reopen the claim. Settlements include releases of future claims. Never settle until you reach maximum medical improvement and understand long-term effects.