22
Jun
2021

What happens if you have a car accident without auto insurance?

Personal and commercial car insurance is absolutely essential for any vehicle owner, as well as being legally obligatory in most states. It serves to protect you in cases of accidents and emergencies, covering the many costs that can come along with the average collision, and with six million accidents occurring in the US on average every single year, having insurance is clearly of the utmost importance.

But what happens if you are driving without insurance and get into a collision? Well, for starters, there’s a risk of fines, loss of your license, and even jail time for being caught breaking the law and not having insurance in your state. You’ll also potentially face huge costs to cover the damage caused during the accident, with no insurance provider to bail you out.

Drivers of ridesharing companies like Uber and Lyft need a seperate insurance plan: rideshare insurance. It gives a driver confidence to know that they are fully covered if an accident happens while driving. To get the best rideshare insurance, a driver needs to make sure that they get the coverage they need. The types of coverage are:

  • LIABILITY
  • COMPREHENSIVE
  • COLLISION COVERAGE
  • COLLISION WITH UNINSURED/UNDERINSURED MOTORIST
  • MEDICAL BILLS
  • GAP COVERAGE

When you are in an accident in a company car

With company cars, it can get a little more complicated if and when accidents happen, and the exact consequences of each situation can vary from case to case. In most situations, it’s not up to you to worry about insurance when driving a company car, as those kinds of vehicles should be covered by your employer.

Businesses need to invest in commercial car insurance to cover all vehicles used for business purposes, so if an accident happens when you’re driving a company car and you don’t have personal insurance, you should still be able to make a claim via your employer for any medical costs or other damages. However, as stated above, the specifics can vary depending on location, the severity of the accident, and whether or not you were at fault for the accident.

What happens if it is your fault?

This is the worst-case scenario for getting into accidents without personal car insurance. If you’re the one who caused the accident, then not only will you have to pay for all the damage done to your own vehicle, but you may also be sued and held responsible by the other driver or drivers involved in the accident.

The exact process that follows when you cause an accident without insurance can vary depending on your home state, and if other drivers only suffered minor injuries in an accident, their own insurance providers should cover the necessary medical costs. If, however, their injuries are more substantial, you could be held liable, and you’ll also have all of your own costs to take into account.

When an uninsured driver crashes your car

Allowing someone else to drive your car can be a risky decision, especially if that person doesn’t have any insurance of their own. While you might assume that any accidents that they will be held responsible for any accidents caused, the responsibility for any collisions, as well as the associated costs, might actually come back to you in the end.

When auto accidents happen, insurance providers tend to focus more on the car itself, rather than being concerned with who was driving it, and since the car will be in your name and you allow someone to take it, you’re the one who will typically be held liable for costs and damages.

In the worst cases, other parties involved in the accident who suffer serious damages may come after you and take legal action to seek compensation for those damages. Depending on the severity of the accident, these costs may be exceptionally high and could even lead to loss of your home, savings, and so on.

What you have to pay after an accident with no insurance

If you’re driving without any auto insurance and get into an accident, you may have to pay quite a lot, depending on the situation. If it’s only a minor fender bender, you can consider yourself lucky and shouldn’t have to pay too much or anything at all in terms of vehicle repairs or medical costs, but in more serious cases, where people get hurt and cars get damaged, costs can begin to spiral.

This is especially true if you’re the one who caused the accident. If it wasn’t your fault, you’ll usually only have to worry about your own medical bills and car repairs, which can still be quite costly. If it was your fault, however, other parties involved in the accident may sue you and force you to pay for their own damages, as well as your own.

This is why personal auto insurance and commercial car insurance are always so important. They help to prevent situations like these, covering you in case of accidents and helping to pay for all the associated costs like medical bills, car repairs, rehabilitation, loss of income, and much more. From a financial, legal, and personal perspective, it’s always a good idea to have insurance.

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