When you get into a car accident, it can be difficult to know which insurance you file through. Your state’s “at-fault” system vs. “no-fault” system might give you a clue, but there are multiple policies that could end up being involved in each category.
In no-fault states, your insurance typically covers first, then overages are brought against the other driver (when possible). In at-fault states, you typically go after the at-fault driver’s insurance first. You might have additional first-party coverages on your policy that work like no-fault insurance and can go first. If all of that’s not enough, you might have uninsured/underinsured motorist coverage. Additional policies might also apply when either driver is working, driving a rental car, or using a borrowed car.
For a free review of your potential case, call the Dallas car accident lawyers at The Queenan Law Firm at (817) 476-1797 before talking to insurance.
Order of Overlapping Policies
When car insurance policies overlap and multiple policies potentially cover your crash, they typically apply in this order – but there are special exceptions we will discuss below.
No-Fault Policies and First-Party Benefits
If you live in a no-fault state, then you typically use your own insurance first. There, everyone is required to have at least some coverage – usually for medical bills or PIP (personal injury protection), which covers both medical bills and lost wages.
Even in an at-fault state, you might have add-on policies you can use first, like a no-fault policy. These pay damages in a “first-party” claim with your own insurance, regardless of who caused the accident. The most common are collision coverage for your vehicle repairs and medical payment coverage for your hospital bills.
Liability Policies
If you live in an at-fault state, then you can go straight to filing a claim against the at-fault driver’s liability insurance. This is also typically how you get vehicle damage covered, even in no-fault states (which are really only no-fault for medical bills and lost wages).
In no-fault states, you may need to meet certain thresholds, such as having “serious injuries,” before you can file a claim with the at-fault driver’s liability insurance. These limits usually do not apply in at-fault states.
Uninsured/Underinsured Motorist (UM/UIM) Insurance
If the other driver doesn’t have insurance, then you can use your uninsured motorist insurance (UM). If you go through the other insurance first, then you still have damages left over, you can use your underinsured motorist insurance (UIM).
Some states require UIM. Others require insurance companies to offer it, meaning you have to reject it in writing if you don’t want it. In other states, it’s totally optional, but often worth having.
Additional UM/UIM Policies
In some states, “stacking” UM/UIM is allowed. This means you can use UM/UIM for a policy from another household member or another vehicle to cover this accident.
This can often let you get even more coverage if everyone’s insurance is too low, even after you go through first-party benefits, liability insurance, and your first UIM policy.
When Multiple No-Fault Policies Apply
There are a few situations where multiple no-fault policies or coverages might apply from different people’s policies, with different potential rules.
Driving a Friend’s Car
If you are in another person’s car, they might have no-fault coverage for the driver of their vehicle, while you might have no-fault coverage that covers you, regardless of what car you’re in. This means you may be able to make a claim through their insurance and your insurance.
Talk to our Grand Prairie, TX car accident lawyers about which order to make these claims and which policy has “better” coverage.
Commercial Drivers
Many commercial drivers are covered by their employer’s car insurance and their own commercial policies. If your employer has the only commercial driver’s policy, it usually applies instead of your personal driver’s policy. If you both have commercial policies, you likely use your employer’s insurance first.
If you were hurt while performing work duties, you might also qualify for coverage under your employer’s Workers’ Compensation insurance.
Uber and Lyft Accidents
Uber and Lyft do not treat their drivers as employees, but they nonetheless have insurance to cover accidents.
While a passenger is in the car or the driver is on the way to pick up a passenger, Uber/Lyft’s insurance should cover the rider regardless of fault. It may also cover other drivers, but not necessarily cover the Uber/Lyft driver.
When Multiple Liability Policies Apply
In some situations, you might have damages paid through multiple liability policies. To refresh, these are the at-fault policies that you can file against when another driver is responsible for your crash.
Multiple Drivers
When multiple drivers are at fault, you can file against each of their liability policies. Typically, courts and insurance split damages according to each driver’s percentage of fault, so they would each pay their share through insurance.
Commercial Driver
If the at-fault driver is a commercial driver, they probably have insurance through their employer. Typically, when someone injures you while they were performing their job duties, their employer is the one to pay your damages instead of them.
However, if it is too much for the employer’s insurance to cover, the individual driver’s insurance might kick in, too.
Uber and Lyft Accidents
Uber and Lyft also have liability insurance:
- If there is a rider in the car or the driver is on the way to a pick-up, the rideshare company’s $1 million policy should cover the accident.
- If the driver was on duty and their commercial driver’s insurance is not enough to cover the accident, Uber/Lyft has supplemental coverage that adds on after the driver’s insurance.
- If the driver was off-duty, their personal insurance covers the accident.
FAQs for When Multiple Insurance Policies Overlap in a Car Accident
Can You Use Your Insurance if the Other Driver’s Coverage is Too Low?
You may have first-party benefits like collision coverage and medical payment coverage that you can always tap into if you need it. However, if the other driver doesn’t have enough in their liability insurance, you cannot use your liability insurance in its place.
If you have UM/UIM, it usually has the same coverage amounts as your liability insurance, and you can use that after exhausting the other driver’s coverage.
Can You Use Your Health Insurance?
Health insurance might not want to cover costs when someone else was responsible for them. Talk to your lawyer about whether you can use your insurance when you get billed at the hospital.
In many cases, the hospital should bill car insurance directly for your treatment.
What if Two Insurance Companies Both Pay You?
You cannot recover the same damages twice and keep them. In many cases, your insurance might pay for something first, but then you get it compensated by the defendant’s insurance, too.
In these cases, your insurance can “subrogate” your claim and get paid back for the amounts they spent when you win your claim against the at-fault driver.
Call Our Car Accident Lawyers Today
Call (817) 476-1797 for a free case review with The Queenan Law Firm’s Burleson, TX car accident lawyers today.