So, a friend asked to borrow your car, you gave them the keys, and they were involved in a car accident. Most people who find themselves in this situation are fear they have made a huge mistake. This is mostly because they have no idea whether their car insurance policy will cover the accident and whether they will be held liable for any injuries or damages. The answer these questions is not simple and will depend on many different factors. If you find yourself in this situation and you have no idea what to do, speak to our Joplin car accident attorney.
Will My Car Insurance Cover the Accident if I Loaned My Car to Someone?
This is not a simple yes or no question. There are so many factors that must be considered. First, what does your car insurance policy cover? In most cases, car insurance applies to the vehicles that are insured, not the person who obtains the coverage. But, depending on the coverage provisions, your car insurance may or may not cover damages that occur when someone other than you or others in your household are driving. So, the first step is to look at your policy to see what is covered. Of course, determining whether the person to whom you loaned your vehicle is at fault in the accident is very important as well. If it turns out that the other driver was at fault, then that person’s insurance should foot the bill.
Understand the Limitations on Coverage of People in Your Household
It is also important to recognize that, simply because someone lives in your household may not necessarily mean they are considered covered drivers under your car insurance policy. Depending on your insurance policy, coverage may only extend to your spouse or people who are specifically named in the policy. There may also be exclusions for certain people. Your insurance carrier may not cover your children unless they are a certain age. You may also choose to specifically exclude certain people in your household because they are at-risk drivers for any number of reasons. If you have questions about your insurance coverage and potential liability, ask our Joplin car accident attorney.
What Happens if There is no Insurance Coverage?
Many states now impose serious penalties on drivers who do not have car insurance, particularly when those people are involved in a car accident. Some states, though, have taken further steps by passing so-called “no pay, no play” laws which prohibit uninsured motorists from receiving any compensation for non-economic damages, even if they were not at fault. Missouri is one of those states and our Joplin car accident attorney will explain the latest update on that law.
The Premise Behind So-Called “No Pay, No Play” Laws
These “no pay, no play” laws are based on the premise that uninsured motorists would not be able to compensate other drivers if they caused an accident, so their own recovery should be limited as well. There are currently 11 states that have enacted some version of this law. Missouri has one but Arkansas does not. This year, however, there has been a Missouri state court decision that may lead to the law being held unconstitutional. If you still have questions about the laws in Missouri, our Joplin car accident attorney can help.
Minimum Insurance Coverage Requirements in Missouri
In Missouri, every driver is required to obtain auto insurance before they can legally drive their vehicle or even register the vehicle with the state. Out-of-state drivers must also carry at least the minimum coverage amounts in order to legally drive in Missouri. The minimum coverage amounts are as follows:
- $25,000 per person for bodily injuries suffered in an accident
- $50,000 per accident for bodily injuries, when more than one person is hurt, and
- $10,000 per accident for property damage
What is Uninsured Motorist Coverage?
Uninsured motorist coverage (UM) provides a minimum level of recovery for individuals injured by an uninsured motorist. Uninsured motorist coverage is different from liability insurance, in that it is more like bodily injury insurance coverage. Underinsured motorist coverage (UIM) is similar to uninsured motorist coverage. Its purpose is to provide additional coverage in the event the at-fault driver has insufficient coverage. The law requires that consumers in Missouri be given the option of purchasing underinsured motorist coverage. However, it is not required.
If you have questions regarding car accidents or any other personal injury matters in Arkansas or Missouri, please contact the Cottrell Law Office for a free consultation. You can contact us either online or by calling us toll-free at (800) 364-8305.