Note: This article deals with your options after an accident where the other driver is found to be at fault, but whose insurance company refuses to pay. It does not deal with what happens if your own insurance company denies a claim from you.
Being the victim of a car accident is bad, but when the other driver’s insurance company won’t pay, even when they’re at fault, it can be even worse. Still just because the other driver’s insurance company refuses to pay, doesn’t mean you have no recourse. In fact you have a few options to choose from.
Gather Evidence And Contact The Other Driver’s Insurance Company
Your first step after the other driver’s insurance company refuses to pay a legitimate claim is to find out why. Make sure you get a copy of the claims adjuster’s case report. They may not have enough information about the accident or they may dispute some of the facts or they may claim they don’t have to pay the full amount because the other driver did not purchase enough insurance coverage. Once you know why they won’t pay, you can start to do something about it.
Your next step is to gather all the evidence you need based on the reason(s) the other company won’t pay. In cases where fault is important, you should have a police report along with the insurance adjuster’s report, that clearly outlines who is at fault and in what degrees. Most states operate under comparative negligence laws where your ability to collect is based on your degree of fault. So long as you are less than 50% responsible for the accident, you can likely make a claim.
However, the following jurisdictions operate under contributory negligence where you can not make a claim against the other driver if you are in any way deemed to be responsible for the accident. They are: Alabama, Maryland, North Carolina, Virginia and Washington DC. If the evidence is clear cut, the insurance company should be willing to pay what it owes.
Yet, you should be aware that the other driver’s auto insurance company is only legally obliged to pay out up to the policy limits of the other driver’s car insurance policy. If your claim against them is above this amount, they will only pay up to what is outlined in the policy and not the full amount. Fortunately, there are options if presenting them with evidence does not work, or if they will not pay the full amount of your claim.
Contact Your Insurance Company
If you’ve been in an accident, regardless of fault, you need to contact your insurance company. Each state has it’s own laws when it comes it auto insurance, but not telling your company about an accident can be grounds for future rate hikes in some states. Plus, if you’re not at fault, you have nothing to worry about, and your insurance company may even be able to help you.
Some states allow you to file an insurance claim against another driver and their insurance company through your own insurance company. When you file a claim with your own insurance company it is know as a first-party claim, whereas if you file an insurance claim with the other driver’s insurance company, it is know as a third-party claim. Always check with your insurance company about which option is best for you, given your circumstances.
It is too late to get uninsured/underinsured auto insurance after an accident. However, if you already have it, it may come in very handy. Basically, this coverage is offed by your own car insurance company and will pay you if you get in an accident with an uninsured or underinsured motorist. It is mandatory in many states. If you have higher than the minimum amount of legally mandated liability insurance you should definitely consider this coverage, assuming you live in a state where it is not mandatory.
It will pay you up to your policy limits, if the other driver’s insurance policy is not enough to cover the full cost of your claim. Moreover, if the other insurance won’t pay you, but you do have a legitimate reason for compensation, then your insurance company may pay you and seek the cost from the other company themselves.
At the end of the day, your insurance company should be able to advise you about the best course of action your should take regarding the other driver. They should be able to tell you if you have a case against them and may possibly try to recoup costs themselves, depending on the amount and type of coverages you have with them.
Contact Your State’s Department of Insurance/Division of Insurance
Your next move is not mandatory, but can be helpful to other drivers in the future. If an insurance company denies a legitimate claim, then you have grounds to complain. You can file a complaint with your state’s Insurance Department/Division of Insurance. They will most likely not be able to help you resolve your problem directly, but can take note of your complaint.
Complaints are often published by state Insurance Departments and if a company gets too many complaints, it may see its license revoked. This won’t really help you get money from the other company, but may help prevent other drivers having to go through the same thing you did.
You can find out more about your state’s laws and Department locations from your state’s information page below:
Hire A Lawyer And Go To Court
Finally, your last resort if an insurance company refuses to pay you what it owes and your own insurance can’t/won’t help, is to hire a lawyer and got to court. This can be both expensive and take a long time. Therefore, it might not be worth it for more minor claims. Still, hiring a lawyer and going to court is an option that is open to you, should you seek to use it.
So as you can see you do have options when you are the victim of an accident caused by another driver whose insurance company won’t pay you what you’re owed. Ideally evidence would win the day every time. Unfortunately, this doesn’t always happen. In these situations the best outcome is to have your insurance company help, but if that is not possible a trip to court may be the only solution.