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How Car Insurance Companies Determine Fault After an Accident

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There are a lot of things to keep in mind after you get into a wreck, including dealing with injuries and insurance. If you get into a car accident involving another driver, insurance companies will want to know who was at fault in order to figure out who pays for medical expenses and property damage. Here’s how they do it.

First of all, the state in which an accident occurs plays an important role. Most states are fault-based, or “tort” states. This means that fault determines who pays for medical costs, lost wages, pain, and suffering, as well as property damage. These expenses get paid through the liability coverage of the driver who was at fault.

If your accident occurred in a no-fault state, the fault is still a major factor. States with no-fault insurance laws usually require drivers to carry personal injury protection (PIP) insurance, which covers the medical expenses of the respective holder if they sustain bodily injuries. However, fault still comes into play when it comes to property damage. Fault is also important for adjusting insurance rates.

The key concept in determining fault is negligence, and there are a few types to consider — again, depending on the state in which the accident occurred. Some states go by a method known as comparative negligence, whereby fault is determined as a percentage, split between parties involved. For example, if one driver is speeding and a second driver pulls into the same lane without signaling, causing the first driver to rear-end the second, the fault could be ruled 60% for the first driver and 40% for the second. The insurance policies would then pay out according to those percentages.

Further, some states modify comparative negligence to stipulate that a driver must be less than a certain percentage of at-fault in order to file a claim through the other driver’s insurer. This is the most common method among states, and the threshold is usually 50%.

The last variation of negligence law is termed contributory negligence. Under this form, insurance will not pay out unless you’re completely free of fault. That is to say, being even 10% at-fault would rule out compensation for damages.

The most important factor that insurance companies consider is the police report. Seeing as how the police are the most reliable reporters on an accident, the version conveyed in their report will overrule what either party claims if there’s a dispute.

It’s also important to gather all the evidence at the scene that you can. If possible, take photographs and talk to eyewitnesses yourself. If you suspect that the other driver may be intoxicated, try to get some video of their behavior.

Never admit to fault at the scene of an accident. In fact, if you have any questions, you should avoid discussing fault until you meet with an attorney. Some situations are tricky to figure out, and depend on your state’s laws, such as the example above about who is at fault in a car accident changing lanes.

Finally, keep in mind that fault could affect your insurance rates, but this isn’t always the case. It depends on your past driving record and the specific details of the accident.

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