If you are involved in a car accident and do not have insurance, the outcome of this situation will depend on many factors, including the rules where you live and who is liable for the collision.
In every state except New Hampshire and Virginia, you must have at least some liability insurance. Being uninsured can result in legal penalties, including:
- license suspension
- jail time
- impound your vehicle
- Are required to file Form SR-22 (Certificate of Insurance Coverage) to legally drive in the future
These legal penalties apply separately from any civil claims that other drivers may bring against you to recover damages they caused as a result of the crash.
If your state requires auto insurance and you are at fault
If you were at fault for the accident, you may be required to pay for any damages you caused. It depends on where you live:
- if your state is no fault status, All drivers receive minor injury compensation from their own insurance company by filing a claim under their Personal Injury Protection (PIP) insurance coverage. However, you may be responsible for property damage yourself. If the injury is serious, another driver can file a claim against you for medical expenses, pain and suffering, emotional distress, and lost wages not covered by their PIP insurance.
- If your status is fault statusyou may be liable for all costs related to a car accident, including medical bills, lost wages, damages for pain and suffering, and emotional damages, no matter how severe the injury.
Typically, your insurance company will pay your legal costs and cover damages suffered by other drivers, up to the policy limit. But if you don’t have insurance, other drivers can try to collect you personally.
If your state requires auto insurance and you are not at fault
If the other driver was at fault for the accident, you may be able to recover from their insurance company.
You can file a third-party claim with their insurance company to collect damages for all losses you have suffered. If the insurance company makes an acceptable settlement offer, you may be able to settle your case out of court. Otherwise, you can sue for damages.
However, in some states, there are no pay/no play rules. These rules prevent you from filing a claim against the other driver for non-economic damages (medical expenses, pain and suffering, etc.) if you were uninsured at the time of the accident. Or they can limit your recovery or limit the circumstances in which you can take legal action. For example, you may only be able to file a claim if the other driver was drunk or fled the scene of the accident, or you may only be able to recover part of the damages.
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If your state does not require auto insurance
You do not need to purchase liability insurance in New Hampshire or Virginia. However, if you don’t have coverage, you’ll still be personally liable for the damage you caused, even if your state doesn’t require you to purchase a policy.