The Implications of Having a Car Accident Without Insurance
Table of Contents
- What happens when you involve a car accident without insurance?
- What happens if you live in a state requiring car insurance and are at fault?
- What happens if you live in a state requiring car insurance and are not at fault?
- What happens if you live in a state that does not require car insurance and are at fault?
- What happens if you live in a state that does not require car insurance and are not at fault?
- Conclusion
According to a report from the Insurance Research Council (IRC), about 12.6 percent of motorists in the U.S. are uninsured. Most states in the U.S. consider driving without insurance illegal. Opposing this can have legal and financial consequences, especially if an uninsured driver gets involved in an accident.
What happens when you involve a car accident without insurance?
Drivers without insurance who get involved in car accidents can be subjected to these penalties:
- Fines and jail time
- Suspension of driver’s license
- Suspension of vehicle registration and license plate
- Being required to file an SR-22 form
- Impoundment of vehicle
Anything you are involved in a car accident and you are uninsured; your legal and financial obligations will depend on two things:
- Whether you are responsible for the accident
- What state do you live in
What happens if you live in a state requiring car insurance and are at fault?
Regarding car insurance, states usually follow the no-fault or tort (or at-fault) system. States that abide by the no-fault system require drivers to pay for their vehicle damage no matter who caused the accident. Sometimes, this may also include paying for their medical bills themselves. Motorists must always carry personal injury protection (PIP) coverage in such states.
In certain situations, another driver can sue you (for example, for pain and suffering). These cases are excluded from PIP coverage. Instead, a state sets thresholds to be met for such claims. On the other hand, in a tort or at-fault state, it is different. A driver can sue you for damages, medical bills, or pain and suffering. If you are financially unable to satisfy the settlement, a judge can use any personal assets or garnish future income to do so.
Notably, people living in Pennsylvania, New Jersey, or Kentucky can choose either no-fault or tort insurance. Their rights to sue for damages, however, are comparatively limited.
What happens if you live in a state requiring car insurance and are not at fault?
As an uninsured driver, whether you can recover damages from the responsible driver or not depends on which state you live in. 11 states in the U.S. have adopted something called “No Pay, No Play” insurance laws. These laws restrict uninsured drivers who want to claim damages, medical bills, lost income, or vehicle repairs.
The states that adopted these laws include:
- Alaska
- California
- Indiana
- Iowa
- Kansas
- Louisiana
- Michigan
- Missouri
- New Jersey
- North Dakota
- Oregon
What happens if you live in a state that does not require car insurance and are at fault?
Only New Hampshire and Virginia do not require drivers to have car insurance. If you are an uninsured resident of New Hampshire, you will be held liable for all damages resulting from an accident you caused. Sometimes, proof of sufficient funds will be required as well.
If you fail to pay for damages, you may face losing your driver’s license. At other times, proof of insurance for three years will be required after the accident.
In Virginia, drivers can pay a $500 Uninsured Motor Vehicle fee when registering and renewing a vehicle. No insurance coverage is given in return for the payment. If the driver causes an accident, they are still solely liable for any property damage and bodily injury costs.
If you fraudulently register a vehicle as insured, there will be consequences. This includes driver’s license and registration suspensions, a noncompliance fine of $600, and a reinstatement fee of $145. Additionally, you can be asked to submit an SR-22 form as proof of insurance for three years following your conviction.
What happens if you live in a state that does not require car insurance and are not at fault?
“Uninsured drivers in New Hampshire and Virginia may be eligible to file a third-party claim or institute a personal injury lawsuit to claim damages from the insurance provider of the driver who is at fault” says attorney Henry E. Reaves III of Reaves Law Firm .
Conclusion
Despite it being illegal to drive without insurance in the U.S., many drivers still do so. This can have consequences if an accident occurs. This article has looked at some possible outcomes in uninsured accident cases.
