The Part an Insurance Plays in a Car Accident

What do insurance companies do in regards to a car collision case? Is the value of a claim affected by the availability or unavailability of the insurance? How is the decision factored in deciding made to make the claim against? An examination of those questions will follow.


Liability Coverage

This is the standard form of car insurance. Under this coverage, drivers and authorized drivers are protected against claims due to negligence, and in the majority of states, collisions due to recklessness. It only covers up to the limit of the current policy.

If a driver has a liability coverage of $75,000 and has a claim filed against them, and the person filing had damages well worth over $75,000, their insurance company is only going to pay the $75,000, which is their liability limit.


Available Coverage Not Enough for Value of Claim

The insurance company’s adjusters will not settle for claims that go past the policyholder’s liability limit. An offer will be made by the adjuster only if and when the demand doesn’t exceed the limit. If a demand is made that does exceed the limit, they can simply just ignore the claim. They have no obligation to respond to anyone exceeding more than that person’s liability limit coverage.


Coverage for Uninsured Drivers

Every insurance company is required to offer this option when purchasing a policy, even if it is a small amount of coverage. Additional coverage for uninsured drivers is essential for when a negligent driver who is uninsured gets into a car accident.

Most of the time, the uninsured drivers will not have the money to pay for the damages they caused, but with this coverage, the person will demand it from their insurance companies through ‘uninsured driver benefits’. This way the financial burden is avoided if an uninsured person caused the crash.

Coverage for Underinsured Drivers

In some ways very similar to uninsured drivers.; insurance companies offer this option when purchasing coverage, as well. Additional coverage can be purchased for drivers who get hit by another driver who does have insurance, but not a quality one, which doesn’t cover all expenses. With this coverage, the claim would be made to the insurance company’s driver who is filing the claim. They would only be allowed to demand up to the limit of the coverage limit they purchased for underinsured drivers.

The only way this claim can be demanded is if the underinsured policy is more than that of the at fault driver’s insurance liability limit. For example, the negligent driver has a coverage of only $50,000, but the claim is worth $100,000. An underinsured claim can be made, but only if the plaintiff has $100,000 or more worth in their underinsured policy. If the plaintiff had $150,000 in their underinsured policy, then they would have to settle for the $50,000 from the negligent driver, and then try to get another settlement of $50,000 with their own insurance company.

Limitations on the Coverages

They are not able to exceed the standard liability policy. A driver cannot ask for a $100,000 uninsured policy, when their liability policy is only that of $50,000. They would be able to get a $50,000 uninsured policy.

Investigating Whether Other Driver Has Insurance

At the scene of the accident, police officers will demand identification of the drivers involved, their registrations, and their insurances. They will know when a driver is insured or not. Some registrations even have their insurance company’s information on it, but only in some states.

If a police officer is not present at the time, then the other driver can deny to show that information, unless it can already be seen on their registration. At this point, the only thing that is available to do is ask the driver to show their insurance, or to give the name of their insurance provider. The person can call the police if they refuse to show their insurance, but the other person can decide to not wait around; just hope that they do. Another option would be to grasp as much information as possible and leave.

The accident can be reported to the police after and they will be able to investigate whether or not the person had insurance. In some states, the insurance companies are able to go into other insurance company’s database to find out information on who had and who doesn’t have insurance. They could also help with finding that information out.

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