A motor vehicle accident (MVA) can be a stressful and confusing experience. You might be wondering who will cover the damages after an MVA. You might be worried that you’ll have to pay for the damages yourself, but that’s usually not the case.

In most cases, the other side’s insurance company pays for the damages caused by the other party, to you or other parties involved in the accident.

Proving liability is a whole other issue though, so let’s jump straight into the facts to see how it is proven, and ultimately who ends up paying what.

Determining Liability in Car Accidents

In a situation like a car crash, liability is the determination of who is responsible for the damages and injuries involved.

Knowing how it’s decided is essential for filing insurance claims and lawsuits.

The Role of Negligence in Car Accidents

Liability for most car accidents rests upon a theory of negligence: a failure to use reasonable care in operating a vehicle. Examples include: 

  • Distracted driving (texting, eating)
  • Speeding
  • Running red lights or stop signs
  • Driving under the influence

Courts require proof that the other driver violated his ‘duty of care’; that the duty of care was breached, and that it caused your injury or damage.

Understanding No-Fault and At-Fault Insurance Policies

Structured around insurance policies, the system of who pays for damage after an accident is divided between two systems:

  • No-fault insurance: If you are injured in an accident, your own insurance will pay for your medical expenses and lost wages, regardless of fault.
  • At-fault insurance: The driver responsible for the accident (or their insurance) pays for damages.

In no-fault states, you generally can’t sue the other driver unless you have some sort of serious injury. 

In at-fault states, you can sue the other driver’s insurance.

The Impact of Police Reports and Evidence

Police reports and evidence are crucial in determining liability. When an accident occurs:

  • Call the police immediately
  • Take photos of the accident scene and vehicle damage
  • Gather contact information from witnesses

The officer’s decision on fault is often included in the police report, which in turn can be pivotal for insurance claims and court cases. 

Other evidence, such as traffic camera footage or cell phone records, might also be collected to help determine liability.

Comparative Negligence and Contributory Negligence

Some accidents involve shared fault. Two main systems address this:

  • Comparative negligence: You can recover damages even if you’re partially responsible for your own injuries – but your compensation is reduced by your percentage of fault.
  • Contributory negligence: If you're found even slightly at fault, you can't recover any damages.

In most states, it’s a rule of comparative negligence (where both drivers can be at fault). In some, if you’re even 1 per cent responsible for a crash, you can’t recover. 

Others have a rule that you can’t recover if you’re more than 50 per cent at fault. The bottom line: it’s important to know the law of your state when you assess how much you might receive in an accident claim. 

Financial Aspects of Car Accident Claims

There are many aspects to car accident claims that can affect the injured party financially, and the victims should know these elements so that they have a fair chance of claiming what they deserve.

Types of Damages and Compensation Available

The two types of compensation for car accidents are compensatory and punitive damages. 

Compensatory damages are to cover actual damages or losses, such as damage to property, medical expenses, wage loss, etc. These damages are classified as economic and non-economic damages.

Economic damages include quantifiable losses such as repair or replacement costs for damaged vehicles, as well as medical bills and lost wages. General damages are non-economic damages intended to compensate for pain and suffering, emotional distress and other intangible harm.

In cases of extreme negligence, punitive damages can be assessed to discourage others from engaging in the same behaviour.

The Cost of Medical Expenses and Lost Wages

Medical costs are often a large part of claims for car accidents, such as the cost of a trip to an emergency room, surgeries, prescription costs, physical therapy, and other ongoing treatments.

Lost wages cover income you miss out on as a result of injuries, including time away from work to recover and for medical appointments. In more serious cases, you can claim loss of future earning capacity if you’re unable to work as a result of your injuries for the foreseeable future.

Maintain careful records of all health bills and documents relating to your work for your claim of these expenses. 

Negotiating with Insurance Companies for a Fair Settlement

Generally, insurance companies settle cases related to car accidents. The insurance company of the at-fault driver is responsible to pay damages up to policy limits.

If you’re negotiating over a claim, your demands should be rooted in evidence: a medical report, repair estimates, lost-wage documents, etc. Insurance companies typically start with a low offer, so be prepared to counter.

Consider issues of pain and suffering in your negotiations. Insurance adjustors will often use multipliers, which are formulas to calculate ‘non-economic’ damages; these multipliers will take the economic damages and multiply them anywhere from 1.5 to 5 times the amount, depending on the severity of the injury.

Legal Advice and Representation in Car Accident Lawsuits

Sometimes a car accident claim is complex enough that you need to speak to a legal professional. A car accident attorney can help to explain your rights and your options for compensation.

Lawyers can help you collect evidence, negotiate with insurers, and (if all else fails) file a personal injury lawsuit. They know which statutes of limitations apply to your case, and they can make sure you never miss a deadline.

Legal representation can be especially helpful if you’re dealing with serious injuries, disputed fault or reluctant insurers. Most lawyers charge on a contingent-fee basis, which means they don’t get paid unless you win your case.