Frequently Asked Questions - Who Pays For Car Damage In A No-Fault State?
Getting your vehicle fixed after a car accident can be a very overwhelming and intimidating undertaking. Your vehicle is damaged and in need of repairs, or perhaps it is even undrivable. Who pays for your car damage? The question to the first answer is, “Who was responsible?”.
If you were found to be at-fault for the accident, then you would be responsible for your vehicle’s damages as well as any other vehicle or vehicles that were damaged in the crash. In this situation, you would need to make a claim through your own automobile insurance carrier under the collision coverage of your policy in order to repair the damage to your own vehicle. You would be responsible to pay any deductible under your collision coverage before your insurance company will pay for your repairs. Furthermore, if you are at-fault for the crash, it is likely that any and all other parties involved will file a claim through your automobile insurance policy under the property damage coverage in order to get their vehicle(s) fixed.
On the contrary, if you were found to be not at-fault for the accident, then it is the responsibility of the at-fault party to pay for the damages to your vehicle and any and all other vehicles involved in the crash. More specifically, the at-fault party’s insurance company will cover the property damage claim(s). The at-fault party’s insurance company will likely send a representative to first inspect your vehicle and then make arrangements for it to be fixed at a local repair shop. The insurance company is responsible to provide you with a rental vehicle for a reasonable amount of time while your vehicle is being repaired, or until they pay out your total loss settlement.
Although the above answers seem very black and white, there are a lot of gray areas in auto accidents as they are not all the same. There are certain circumstances that can convolute, slow down, hinder or even altogether halt the process of fixing your car damages. Thus, please know, in a no-fault state, you also have the choice to go through your own automobile insurance carrier for your property damage claim. In order to do so, you would utilize the collision coverage under your insurance policy. You may want to take a look at your policy ahead of time to make sure you have this coverage. Dependent on your state’s insurance laws and regulations, collision coverage may not be a requirement to have on your policy. On the other hand, dependent on the type of vehicle you have, your lienholder may have required you to purchase collision coverage on your insurance policy even if it is not required by the state before you could drive your vehicle off the lot. You can ask your insurance agent for a copy of your “declarations page” which will outline the coverage you purchased on your policy when you signed up.
Now, most people are extremely hesitant to use their own insurance company in a car accident that was not their fault. They feel it is not fair that they have to use their own insurance company when they did not cause the crash. However, please know, that in a no-fault state, using your own automobile insurance carrier to fix your vehicle damage is not considered an admission of guilt. In a no-fault state, by going through your own insurance carrier to fix your vehicle, does not mean that you have to accept or are accepting liability for the accident. Being able to use your own insurance policy regardless of who is at-fault for the accident is one of the benefits of the no-fault structure.
In certain predicaments, deciding to go through your own insurance carrier to fix your vehicle may very well be your best option. For example, it would be to your benefit to simply utilize your own collision coverage if there is an ongoing liability investigation delaying the at-fault insurance carrier from paying your vehicle damages, or perhaps the at-fault insurance carrier decided to deny liability based off a conflicting statement of the accident facts from their insured and, thus, are refusing to pay for your vehicle damages altogether. Sometimes, there are multiple vehicles involved and the at-fault insurance company refuses to pay for anyone’s vehicle damages until they have an estimate on every vehicle that was involved in the crash. This can take quite some time to organize and collect. So, in those situations, many find it much more sensible to simply use their own insurance carrier as a more expeditious avenue to fix their car. Another benefit of using your own insurance carrier is simply for better customer service. Often times, your own insurance company is going to treat you better than another and is likely to provide faster and better customer service so as to keep your business.
Now, on the downside, should you have a collision coverage deductible on your policy, as most people do, then you would need to pay for that deductible upfront before your insurance company will pay for your vehicle’s damages or payout your total loss claim. For most of us, paying the deductible upfront can be quite a costly or even unaffordable expense. However, your only other option is to wait until the liability decision has been made, and that it is hopefully in your favor – that you are not found at-fault for the crash – before the at-fault insurance carrier will pay for your vehicle’s damages.
Then again, if you decided to go through your own insurance carrier for your vehicle repairs and you had to pay out your collision deductible, you may get reimbursed that money. Once liability has been settled in your favor, meaning the liability dispute is over and the at-fault insurance company accepts full responsibility, then your insurance company will enact their legal right of subrogation – to collect on that debt (your collision deductible) – and recover it for your benefit. Once they subrogate your deductible from the at-fault insurance carrier, that money will go back into your pocket. If the liability investigation however does not go your way and you are found to be at-fault for the crash, then you will not be able to retrieve your deductible.
Not all accidents are the same. Not all accidents develop smoothly and rapidly. So, if the at-fault insurance carrier is not complying, it would be wise to go through your own insurance carrier to fix your car’s damages. Let’s face it, the faster your car is repaired, the faster you can get back to a semblance of your normal routine.