Uninsured Motorists: What if You Are in an Accident with Someone Who Has No Insurance

First, it is important to note that the party who has insurance may not necessarily be the party who was at fault for the accident.  It is the at-fault party who is responsible for paying for the damages of the party who was not at fault.  This is true whether or not the at-fault party has insurance. Here is an example, and let’s say we are in a state where there is a fault-based insurance scheme—in other words, it is not a “no-fault” auto insurance state.

Suppose Anne ran a stop sign and hit the passenger side of John’s car when he was legally in the intersection.  It was clearly Anne’s fault. If Anne has insurance, her property damage liability coverage should pay for the damage to John’s car.  If Anne does not have insurance, she will likely have to pay for John’s property damage out of her own pocket.  If Anne has no insurance and John does, John can choose to go through his own insurance to get his car fixed (if he has collision coverage).  They might or might not charge him his deductible. (If an insured is not at fault, some insurance companies don’t charge the deductible.)  Then his insurance company can subrogate against, or make a legal demand for reimbursement from Anne, and even take her to court to get the money back if necessary.

If John was injured in the accident with Anne, Anne is legally liable to take care of John’s medical expenses, his lost wages, his pain and suffering and any other related expenses he may have incurred.  If she is insured, her Bodily Injury Liability coverage would pay for that up to the limits of her policy.  If she is uninsured, or has only the minimum coverage, and John is pretty badly hurt, he can go to his own insurer and make either an uninsured motorist claim or an underinsured motorist claim.  (Uninsured, if Anne has no coverage at all; underinsured, if Anne doesn’t have enough to cover his expenses.)  Then John’s insurer can go after Anne to get their money back.  John might also have Medical Payments insurance on his own policy, and that will cover his medical bills up to his policy limits.  Some insurance companies do not subrogate for Medical Payments claims.

So you see that the person who ultimately pays is the person who was at fault, regardless of whether or not the at-fault driver has insurance.