What to do after a car accident that’s not your fault

If you’re ever unlucky enough to be in a car accident, assuming you and your passengers are unhurt, your thoughts are naturally going to quickly turn to the financial damage.

In other words, your car may have stopped moving, but your mind is racing at top speed.

It can be really difficult to know what to do next, especially if you feel you weren’t at fault. You might be plotting everything from suing the other driver to calling your car insurance agent to thinking about buying a new car.

After a car accident that isn’t your fault or is your fault, you should:

1. Call 911 if anybody involved in the accident has been injured. Even if no one has been hurt, you may also want to call the police if the cars are really damaged so you can get a police report.
2. Exchange insurance information with the driver.
3. Take photos of your car – and if the other driver doesn’t object – their car, too. This will help with everybody’s insurance.
4. Don’t play the blame game. It’s best to not point fingers at you or the other driver. Let the insurers figure this one out.

More details to come. We’re about to tell you everything you need to know on what to do after a car accident that is not your fault.

How does car insurance work when you are not at fault?

When you’re involved in an accident you didn’t cause, you should collect the other driver’s information at the scene so you can make a claim against their liability insurance. When you do this, the claim goes on their insurance record, not your own. If you have collision insurance and medical payments coverage or Personal Injury Protection — MedPay and PIP help pay medical expenses after a car accident that results in injury — tell your insurer about the accident. If the other driver doesn’t have insurance, or has low limits, you can make a claim to your insurance company.

What is a third-party claim?

A third-party claim is when you file an insurance claim with another driver’s insurance company. There are three parties in this situation — the other at-fault driver, the other driver’s insurance company and you. You are considered to be the third party.

In most cases, if you aren’t at fault in a car accident, the other driver’s state-mandated liability insurance coverage would pay for damage to your car, property and for medical bills for injuries, up to the limit of the policy. This is especially useful if your policy doesn’t have adequate coverage. In no-fault states, however, regardless of who is determined to have caused the accident, you’d file a claim with your own insurance company.

How does a third-party insurance claim work?  

The third-party insurance claim sometimes referred to as a liability claim, uses the at-fault driver’s liability coverage to cover damages and injuries. The third-party insurance claims can be made for medical bills, vehicle repairs, a rental car, and lost wages if you miss work due to the injuries caused. All these claims depend on two factors – the state where you are and the other person’s coverage. Although, the third-party insurance claims work differently in states with no-fault insurance and states without no-fault insurance.  

If you are living in a state which offers no-fault insurance, after a car accident, you can file a claim with your own insurer for medical insurance. If a state does not offer no-fault insurance, you can file a third-party insurance claim for property damage and medical costs. 

It is important to remember that the at-fault driver’s policy will only support paying for your repairs, up to their coverage limits. For example, assume your car is declared a total loss by the competing insurance firm and is valued at $50,000. If the other driver’s coverage limit is $40,000, you may be required to pay $10,000 out of pocket to replace your vehicle.

How to file third-party insurance claims 

A third-party claim is a claim you file with the insurance of another motorist. As noted, you are the third party. You are referred to as the third party because you are making a claim with a policy that doesn’t provide you coverage.  

Below are the steps you can follow to file a third-party insurance claim.

Gather necessary information

The driver who crashes into your car is responsible for reporting the accident to their car insurance company. However, unless your insurance agent makes it clear that they’ll be contacting the other driver’s insurance company, you may want to contact their insurer as well. Motorists who cause accidents are often reluctant to report them.

It’s vital to get complete information on the other party at the accident scene. Collect the following:

• Other driver’s name and address
• Other driver’s insurance company name and policy information
• Statements and contact information from witnesses
• Take pictures of the accident scene — most smartphone cameras are suitable. If you can take pictures of the cars as they sit right after the accident it is best. If you had to move due to safety concerns, then take photos of the damage to each vehicle.

In addition, the National Association of Insurance Commissioners has a Wreck Check auto accident checklist you can print and keep in your vehicle. Your phone can help you collect and exchange the right information.

Using a Google map satellite images of the intersection or accident area may also help explain how the accident happened. And, if you have a dashcam be sure to find and save any footage of the accident so you can share it with the insurance company. That is especially helpful if the other driver doesn’t admit responsibility to their insurer.

Notify the right people

First, inform the other person’s insurer that you have been involved in a crash with one of its policyholders. Relay only the facts of the accident. Even if you believe the other driver to be at fault, it’s not smart to say that. Instead, give the insurer the facts to show their driver is at fault and liable for your damages. You’ll be far more credible that way.

Although you may have not caused the accident, you should also contact your insurance company anyway. This establishes your good-faith accident-reporting effort and can aid you if the other party’s insurer denies responsibility for the accident or their insurance was not valid at the time of the incident and you need to make a collision claim.

Sometimes car insurance companies may demand that you obtain their authorization before proceeding with vehicle repairs and injury treatments. At a minimum, make certain that the insurance company has accepted liability before going ahead with repairs and get that authorization in writing or over email.

Remember that an insurance company can’t force you to take your vehicle to a specific repair facility. Most states allow auto insurers to recommend auto body shops but they aren’t allowed to demand you use a certain repair facility. The choice is yours.

Pick your battles wisely

The at-fault driver’s insurer may tell you to seek payment from your own insurer because it has no evidence of its policyholder’s fault. Although most states have made it illegal for an insurer to deny claims without reasonably investigating the facts, you may not want to fight the other person’s insurance company. 

If you make a claim with your insurer, it likely will choose to fight the other insurance company for compensation if it finds that the other driver is at fault. But if you decide to fight the at-fault driver’s insurer on your own you’ll need a lawyer — especially if you’ve been seriously injured. An attorney can help you navigate the sometimes-murky laws that govern insurance. But keep in mind that if you hire an attorney, they will take a cut of any settlement they help you get.

You may have evidence of the other driver’s fault — maybe they even admitted it at the scene — yet you find your claim denied by their auto insurance company. Why? Because they probably told a version of how the accident happened that doesn’t square with yours. Their insurer may stand behind that story in order to avoid paying your claim.

Sometimes the insurance company will take its policyholder’s position, even if it contradicts the police report.

If all else fails, look to your insurer: When to file a claim with your own carrier

Even if you’re not at fault, you can make a claim with your insurance company for payment of damages and injuries — if you have the right coverages.

If you have collision insurance, file a claim with your own carrier. It will pay for the cost of repairs or total loss of your vehicle. If you take this approach, you will have to pay your collision deductible toward repairs. However, you may get that money back if your insurer is able to settle with the other driver’s insurance company.

If it turns out the other driver is uninsured and you have uninsured motorist coverage property damage (UMPD), you can make a claim for your vehicle’s damage. There is normally no deductible for UMPD claims.

Do insurance rates go up after an accident caused by a third party?

Your car insurance rates aren’t necessarily going to increase at renewal time if you make a claim under your own insurance policy for an accident that wasn’t your fault.

Most state laws prohibit insurers from surcharging policyholders or raising their premium rates for accidents in which they weren’t at fault. However, those laws do not preclude your insurer from dumping your policy at renewal time if you’ve made a few recent claims of any type.

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Can’t work? Totaled car? Get paid

If you miss work because of an injury you sustained in a car crash that was someone else’s fault, you can expect that person’s insurance company to pay for your lost wages. But their policy will have a limit on the amount you can recoup for lost wages.

If you’re hit by a driver whose liability limits are not high enough to cover all of your medical expenses and lost wages, you can make a claim under your own underinsured motorist coverage for the remainder, if you have it. If you live in a no-fault state, your PIP coverage will pay for your lost wages up to the limits of your policy.

When another driver wrecks your car beyond repair, his or her insurance company should pay you the actual cash value of your car before it was totaled. The industry standard definition of actual cash value is “replacement cost” minus “depreciation.” Replacement cost is the amount of money it would take to replace your vehicle with a similar one. Depreciation is the amount of money your car has devalued over time.

The insurer also should pay for the sales tax on the new vehicle that you purchase with the insurance money. See what to do when your auto insurer totals your car for more information.

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Understand your injury coverage

In most states you would make a claim for your injuries through the at-fault person’s auto insurer. If they are uninsured, you could make a claim through your own uninsured motorist bodily injury coverage, if you have it, or through your health insurance.

There are some states that require you to purchase personal injury protection (PIP) and have slightly different rules for collecting for your injuries after an accident. For example, your PIP coverage pays for your medical expenses and lost wages, even if you are not to blame for the crash. Receiving your PIP benefits requires you to make a claim under your own insurance policy. A deductible and/or copayment may be due when you use your PIP coverages.

This is commonly the situation in no-fault states — although the law differs in each one. Some no-fault states give you the option of contacting the at-fault driver’s insurer to recover medical expenses not paid by your PIP. Your vehicle’s property damage would still be claimed through the at-fault party’s liability coverage in no-fault states (except Michigan where special rules apply).

According to the Insurance Information Institute, 12 states and Puerto Rico have no-fault insurance laws: Florida, Hawaii,, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota Pennsylvania and Utah. If you live in one of these states, it’s wise to check with your insurance agent, or your state insurance department, for the tips on how to handle third-party accident claims.

Rent reasonably

Insurance companies are always looking for ways to shave a few dollars from the cost of a claim, and reimbursements for rental-car costs often are the first to meet the blade.

Insurance companies often tell accident victims that they pay only a certain amount per day for rental cars. As a victim of another person’s negligence, you have the right to recoup the costs associated with fixing the disruption you experience, including all of the costs of renting a vehicle while your own vehicle is being repaired.

To avoid having to pay for part of a rental, rent reasonably. And don’t purchase a collision damage waiver from the rental company if your own insurance policy extends coverage for damage to rental cars.

If you rent reasonably and the insurer wants to short-change you on rental reimbursement, ask the insurer to put its reason in writing. Insurers must inform you in writing of their decisions to deny or reduce payments.

Know what you deserve

Knowing your state’s prompt-payment law is beneficial. Every state’s unfair claims settlement practices act outlines the time frame in which an insurer must issue you a check for your damages. We have more on how your state’s Unfair Claims Settlement Practices Act can help you.

Laws vary widely from state to state, with many simply mandating a “prompt” payment of claims, while others specify a number of days and the interest owed to you if the insurer fails to pay within the specified period.

One last factor to keep in mind: Unfair claims settlement practices acts often do not extend the same rights to you if you’re making a claim against another driver’s insurance as opposed to making a claim under your own insurance policy.

Writing a matter-of-fact letter to the at-fault person’s insurance company is a smart way to inform it of your expectations and rights. Telling the insurer that you expect it to pay all reasonable costs you incur as a result of the accident, including payment for repairs to or the total-loss value of your vehicle, diminished value of your car, medical expenses, lost wages, pain and suffering and rental-car costs will highlight the insurer’s responsibilities under public policy.

Make sure you keep a record of all correspondence, including dates and the names of customer service reps.