If the Accident Is My Fault, Will My Auto Insurance Cover Me?
In most states, hashing out fault after a auto crash is important for one main reason — deciding whose insurance will foot the bill for repairs and medical expenses. For this reason, it’s crucial to get insurance that protects you, as well as the other driver, when you’re at fault in an accident.
Liability insurance will cover other occupants
Nearly all states require you to have a certain amount of liability coverage to pay for repairs and medical costs associated with accidents you cause.
Required liability coverage generally includes bodily injury (per person and per accident), property damage and, in some states, uninsured/underinsured motorist protection (which covers you if the at-fault driver is not insured or doesn’t have enough insurance).
Auto insurance that covers the policyholder
Liability insurance covers only the other driver’s expenses. So, if you have just the minimum liability coverage required by law, you’ll be footing the bill for your own car’s repairs and your medical bills if you cause an accident.
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To be completely covered for an at-fault accident, you should carry the following types of insurance in addition to the liability coverage required by your state. All these types of coverage are optional, and they will raise your premium.
- Collision coverage. Collision coverage pays for the repair or replacement of your car, even if you are at fault in an accident. It covers you whether you hit another car, a building or a tree, according to the National Association of Insurance Commissioners (NAIC). Collision coverage almost always includes a deductible — the amount you must pay before your insurance kicks in. Typical deductible amounts are $250, $500 and $1,000, according to NAIC. The higher your deductible, the lower your premium.
- Medical payments coverage. If you don’t live in a no-fault state where personal injury protection is required, medical payments coverage pays for your medical costs and those of your passengers. It can even cover family members driving your car. Medical payments coverage typically pays for hospital stays, doctor’s visits, physical therapy and funeral expenses.
If you already have health insurance, you may not need this coverage. However, medical payments coverage for your car can sometimes help pay your health insurance deductible.
What are tort, no-fault laws?
Insurance coverage laws differ between so-called tort states and no-fault states. In tort states, fault is assigned in an accident, and the at-fault party’s insurance covers all costs. In a no-fault state, each party’s medical bills are covered by his or her own insurance company.
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So, if you live in a no-fault state, your auto insurance already covers your injury costs, even if you’re at fault. No-fault states require you to purchase a minimum amount of personal injury protection (PIP) to cover your medical bills.
However, your basic no-fault auto insurance policy will not pay for damages to your car, according to Michigan’s Office of Financial and Insurance Regulation. You still will need to buy collision coverage.
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Editor’s note: This is an updated version of an article originally published on Dec. 31, 2013