My Best Friend Wrecked My Car; Whose Insurance Pays?

Accidents happen, and depending on the circumstances, they can turn into minor embarrassments or major, life-altering occurrences and a million other things in between. When accidents involve motor vehicles, they become dangerous events with expensive, painful consequences that someone must pay for one way or another. Between injuries, property damage, lost wages, and any other complications that may arise, states like Alabama have good reason to make sure everyone is financially covered in case of an accident. That being said, figuring out exactly who pays in which situation can be a bit tricky for a myriad of reasons.

If your friend (or anyone else) is borrowing your car for any reason, it’s important to know exactly what insurance coverage, if any, covers them. Whether or not they’re not a great driver is irrelevant (and we all have “those” friends), but whether or not they’re legal to drive and whether or not they’re insured is vital information you should know before you consider handing over the keys. If they cause an accident in your vehicle, it is likely you who pays the price.

How does car insurance coverage work when someone borrows your car in Huntsville?

If you’ve never been personally involved in a car accident, it can be easy to forget you’re not immune to them. Even when we know others who have been in collisions, they still tend to be abstract events until it happens to you. However, Alabama roads see more car accidents each year than you may think. 2022 was actually a safer year than the previous, with both accidents and their resulting consequences a little less common, but there were still over 31,000 different collisions across the state. These crashes took 586 lives and resulted in 10,000 injuries. Those injuries are very rarely just scrapes; they can be serious, disabling traumas that take years from which — if ever — to fully recover.

Of course, that’s why we have car insurance — and that’s why car insurance is required (to an extent) of all drivers. Alabama requires each and every driver to carry at least the minimum insurance of $25,000 for bodily injury per person, $50,000 for bodily injury per accident, and $25,000 for property damage. It is important to know this coverage covers the OTHER party if YOU cause the accident. It’s the minimum required, but it means it would be the maximum insurance would pay for if you cause a collision, so if the accident ends up costing more in any of those areas, you would have to pay out of pocket unless you had additional coverage. When the accident is the other driver’s fault, it would be their insurance coverage that compensates you (though this is not an automatic process — read on to learn the next steps).

Now, when it comes to letting other people borrow your car, you do have a level of financial responsibility. When you let someone borrow your car and he/she causes a wreck, it is your insurance policy that covers the other party’s damages and injuries. Your friend’s coverage only kicks in when yours is exceeded (which is why it’s so important), and you’ll still need to use your own collision and comprehensive insurance to cover your vehicle’s damages.

Think of your friend as also borrowing your insurance when they borrow your car. Accidents THEY cause can make YOUR rates increase and exceed YOUR limits. If you do plan on lending out your vehicle, you definitely want to make sure your policy has more than just the required minimums. Collision, comprehensive, and uninsured/underinsured motorist coverage may make you pay more per month, but you’ll pay far less when the unexpected happens. Especially because car insurance companies are notoriously picky with what they do and don’t cover, making sure you have as many bases covered as possible can really save you a fortune in the long run.

Is my teen covered by my car insurance if they borrow my car?

As parents, our number one concern is our child’s safety and wellness. That being said, when that child is just starting to drive (and using your car to practice), it’s normal and reasonable to be worried not just about your excited teen, but also anyone they might encounter — and your own car, too. It takes practice to become a truly good driver, and there are plenty of dangerous (and expensive) possible mistakes to make before getting to that point. In fact, teenage drivers are likelier to drive recklessly than their adult counterparts in almost every situation.

So, of course you want to make sure one of their mistakes won’t bankrupt the family if it results in a collision. Your child is not automatically added to your car insurance policy. It’s something you should actively do once they have their learners’ permit. Yes, it does raise your rates, but if you fail to add them or they don’t get their own policy, they’re breaking the law and could face significant consequences if they cause an accident. In most cases, they’re also not able to get their own policy until they’re 18 and likely unable to afford one regardless. Meanwhile, they save almost $260 by simply being added to their parents’ policy and many insurance companies offer specific deals for families.

Talking to your teen about safe driving practices and making sure they’re covered by your insurance are the best ways to protect them on the road — no matter what happens.

What to do when the car accident isn’t your fault

Every state handles car accidents a little differently, but they all have legal avenues to navigate when someone else’s negligence causes the collision. Alabama is especially unforgiving in this respect. We are a “tort” or “at-fault” state, which essentially means those who cause accidents cannot seek compensation from the other party, but that other party can.

If you’re even a little bit responsible for the accident, your claim may be unsuccessful. Alabama’s contributory negligence system means those who do cause accidents will do everything in their power to try and prove to the insurance adjusters their victims share the blame, and it also means their insurance companies are likely to fight back when you try to file a claim.

Hiring a personal injury attorney as soon as possible after an accident can help protect you in cases like this. They can help you gather necessary information that could help your claim, from witness testimony to your driving history from a usage-based insurance policy, if applicable. Alongside fact-finding and information storage, they’ll handle the insurance correspondence and advocate for you (or your loved one, if your teen didn’t cause the accident) in court. Having strong legal representation on your side to prove a negligent driver’s liability can get you compensation for everything from medical costs to disability to pain and suffering and any other damages involved.

The Huntsville personal injury attorneys at Martin & Helms have years of experience navigating insurance companies and negligent parties, and we know how to help victims just like you. We have offices in Huntsville and Decatur, and serve Madison, Athens, and all of North Alabama, and we are dedicated to putting your recovery, both financial and physical, first in every regard. To learn more, call us today or use our contact form.