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Car accidents: When can I sue?

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Q:

Car accidents: When can I sue?

A:

According to the National Highway Traffic Safety Administration (NHTSA), more than 2 million drivers and passengers are injured each year in car accidents.

So what happens if you are involved in a car accident? Do you negotiate with your own insurance company or the other driver’s insurance company? Can you file an injury claim?

Let’s take a closer look at all of these questions and what you should do immediately following an accident.

Steps After a Car Accident

Although all car accidents are different, there are common steps you should take immediately after every car accident, including:

  • Calling the police and reporting the accident
  • Ensuring that all drivers are safe
  • Getting injured drivers and passengers medical attention
  • Moving the cars out of the roadway
  • Gathering information from each driver
  • Contacting your insurance company and notifying them about the accident

Whether or not you will seek compensation from your insurance company, receive payment from the other driver’s insurance company, or file an injury claim against the other driver will depend on a variety of factors including state laws, whether you can receive a fair compensation settlement offer from the insurance company, and whether your state has instituted fault or no-fault insurance statutes.

Fault-Based Car Accident Laws

Most states have a tort liability system (fault-based system) for auto insurance claims. Under this system, the drivers who caused the accident will be responsible for compensating those who are injured. This can include payment for property damage, medical expenses, lost wages and pain and suffering. If one or more drivers are at fault, each driver will pay for damages based on their degree of fault.

While this system may be fair, there are unintended consequences (i.e. high costs associated with litigating car accident claims if the insurance company cannot settle with the injured parties).

Fault-based states also allow drivers to file personal injury lawsuits for car accident claims. For example, if you are injured due to the negligence of another driver, in a fault-based state you have the legal right to file a car accident lawsuit. Lawsuits may be filed if drivers are not able to successfully negotiate a settlement with the at-fault driver’s insurance company or if they do not believe that they have been fully compensated by the insurance company and want more money for their injuries or losses.

No-Fault Car Accident Laws

Twelve states have replaced their tort-based car accident system with a no-fault system. Under the no-fault system, each driver’s insurance company compensates each driver, regardless of whether or not the insured was at fault, up to the predetermined policy limits. Payments made under a no-fault car accident system include medical bills, rehabilitation costs, lost wages, and pain and suffering.

Although no-fault states have been able to lower car accident costs by eliminating some costly legal battles, opponents of the system argue that it has made it more difficult for some injured drivers and passengers to receive adequate compensation for their injuries and losses.

Not only do no-fault states eliminate the driver’s responsibility to compensate their victims, they also may bar the injured party from filing an injury claim against the at-fault driver (exceptions to this law exist and will be discussed in more detail below).

The 12 states that use a no-fault-based car accident system or a modified system include:

  1. Florida
  2. Kentucky
  3. Massachusetts
  4. Hawaii
  5. Michigan
  6. Minnesota
  7. Kansas
  8. New Jersey
  9. New York
  10. North Dakota
  11. Pennsylvania
  12. Utah

What are my rights to sue in a no-fault state?

The right to sue for additional compensation in a no-fault state may be allowed under certain conditions, but the law varies by state. For example, some states allow drivers to file an injury claim if their injuries reach a severity threshold. Florida, for instance, allows a claim to be filed if the driver or injured party has a permanent injury or significant and permanent scarring. Michigan allows drivers to file a car accident lawsuit if there is serious impairment of a body function or permanent and serious disfigurement.

States may also allow the injured party to file a car accident claim if an injury threshold is met. For example, Kansas allows claims if medical expenses exceed $2,000. Utah allows a claim if medical expenses exceed $4,000.

Still, other states—such as Arkansas, Delaware, Washington D.C. and Maryland—allow drivers to buy add-on insurance coverage. In these states, the drivers can purchase additional insurance called personal injury protection or PIP. These purchased add-ons give drivers the right to sue for pain and suffering if they are injured due to the negligence of another person or driver.

Do I have a car accident claim?

Whether or not you have a car accident lawsuit will depend on all of the factors discussed above, including your state’s laws and the insurance policy you have purchased. If you live in a no-fault state, your ability to file a car accident claim will depend on whether your state has monetary thresholds or injury thresholds, and whether or not you meet them.

***
Note: A few at-fault states allow drivers to purchase no-fault add-ons to their car insurance policies. For example, no-fault medical benefits can be added onto policies in Maryland, Arkansas, Delaware and the District of Columbia. Under these policies, you may be paid for medical expenses immediately without proving fault, but retain your right to sue for pain and suffering.

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