Texas sees car accidents on its roads and interstates every day. This is why Texas drivers must carry liability car insurance to meet the state’s minimum coverage requirements. This is an essential requirement that protects both drivers and victims when an accident happens.
Even if you have liability insurance, however, the coverage goes beyond adhering to Texas law. It impacts the outcome of car accident lawsuits in most cases. It also determines who will pay for damages and medical expenses.
What Does Liability Insurance Mean?
Liability insurance is a form of car insurance for drivers in Texas (and other states). This insurance protects the driver if they cause an accident that results in injury to another person or damage to their property.
In 2024, the required liability insurance in Texas is as follows:
- $30,000 for injuries per person
- $60,000 for injuries per accident
- $25,000 for property damage
This is collectively known as 30/60/25 coverage.
So, if you cause an accident, your liability insurance will cover medical bills, lost wages, and property damage sustained by the other party. However, it will only cover these losses up to policy limits.
You may become personally liable for the difference if the other party’s damages exceed your policy limits. The other party can file a personal injury case against you and demand compensation.
Liability Insurance and Car Accident Lawsuits
In many cases, liability insurance is the primary source of compensation for damages after a car accident. However, as explained above, you could be sued directly for more compensation.
For instance, if the other party’s losses amount to $50,000 in medical bills, your liability insurance will only cover up to $30,000. If the other party successfully sues you for the difference, you must pay the remaining $20,000 out of pocket.
On the other hand, if you are the victim in the accident, you can recover damages from the at-fault driver’s liability insurance policy. If the driver has sufficient coverage, their insurer will pay for your medical expenses, property damage, and other related losses.
If the at-fault driver has insufficient insurance or is not insured, your options for demanding compensation narrow.
What If a Driver Has Insufficient Coverage?
If you are the victim in a car accident and the at-fault driver’s insurance cannot cover your expenses, you can:
- File a personal injury lawsuit. It is important to remember that if you file a lawsuit against the driver, it does not automatically mean you will be compensated. If the driver does not have insurance, it is also possible that they do not have income or assets.
- Uninsured/underinsured motorist coverage: Texas recommends drivers buy uninsured/underinsured coverage as an extension of their car insurance policy.
This coverage protects victims if at-fault drivers cannot pay for their losses. Your own UM/UIM coverage can make up the difference if it becomes clear that you cannot secure compensation from the at-fault driver.
- Negotiating: Sometimes, an at-fault driver may not have enough insurance, but they may offer to settle the case outside court. This may involve negotiating a settlement agreement in which the driver agrees to pay you a lump sum for your damages.
Again, there is no guarantee that this process will end in your favor. This is mainly because negotiations are usually complicated. You will need a lawyer to negotiate on your behalf.
What If You Cause an Accident and Get Sued?
If you caused the accident and the victim sues you for damages, there are several steps you must take.
Firstly, you must contact your insurance company immediately. Your liability insurance should cover legal bills and attorney fees. Remember to give your insurer all the relevant information about the accident.
Secondly, you must hire a lawyer. Even though your insurance company will deal with the case, a lawyer can help protect your rights. They can also represent you in court if no settlement is reached with the victim’s legal team.
It is crucial to understand the limits of your insurance coverage. If your policy does not cover all the victim’s losses, you must pay the difference yourself. This is just one of the reasons it is important to increase your liability coverage.
Lastly, you must cooperate with your insurer and your lawyer. You must provide them with all the necessary information and documentation required. If your case goes to court, you must attend all court hearings and depositions.
Liability Insurance Has a Major Impact on Car Accident Settlements
Car accident settlements are faster and less costly than going to court for a trial. If both parties agree to pay the settlement, the case can be settled outside court. When this happens, the insurance company pays the agreed-upon amount.
Liability insurance coverage makes it easier for the at-fault driver’s insurer to handle the claim and offer a settlement.
If the at-fault driver has sufficient coverage, the victim may receive a settlement covering all their damages (including potential future medical bills, if possible). If the driver is underinsured, negotiations are more complicated, and other avenues for compensation come into play.
Liability Insurance Is Important
Liability insurance is the best way to ensure that victims are fairly compensated. It is not fair for an accident to cause extreme injuries and damages to a victim, and they are not rewarded compensation for their losses.
As a driver in Texas, you should ensure you have the minimum required coverage. But you should also purchase higher coverage limits. This is primarily because the minimum amounts are often not enough to cover all the costs and expenses of an accident.
You should also add uninsured/underinsured motorist coverage to your car-insured coverage. This will give you extra protection in a car accident caused by a driver with little or no insurance.
Whether you are the at-fault driver or the victim, having the right insurance coverage at your disposal makes a huge difference in the outcome of your case. Having an experienced lawyer by your side will give you a better chance of success, whether you sue or are being sued after an accident.
