Driving without insurance is illegal in most states, and the financial consequences of getting into an accident without insurance can be profound. Here’s a breakdown of the financial and legal consequences of getting into a car accident without insurance.
In this article:
What are the costs of getting into an accident without insurance?
The costs of getting into a car accident without insurance depend on who caused the accident, your state’s insurance laws and the severity of any injuries or damage.
Most states have tort, or at-fault, laws that hold you financially responsible for injuries or damage you cause in an accident. If you don’t have liability insurance, these expenses may come out of your pocket.
In a tort state, an injured person or their insurance company can seek a judgment against you in court. If they prevail, they can potentially seize your assets, place a lien on your home and/or garnish your wages to collect payment.
In the 12 states with no-fault insurance laws, a person’s own insurance usually covers their initial medical expenses after an accident, regardless of fault. If you cause an accident in one of these states, you won’t be responsible for the other driver’s injuries or those of their passengers unless they are particularly costly or severe.
However, you can still be held financially responsible for damage to their car in most of these states.
| Florida |
| Hawaii |
| Kansas |
| Kentucky |
| Massachusetts |
| Michigan |
| Minnesota |
| New Jersey |
| New York |
| North Dakota |
| Pennsylvania |
| Utah |
What if I’m involved in an accident caused by an uninsured motorist?
If you are involved in an accident with an uninsured motorist, there are a few different ways your insurance can protect you, depending on the coverages in your policy.
| Expense | Coverage options |
|---|---|
| Injuries to you and/or your passengers | Personal injury protection (PIP), if available, or medical payments (MedPay) covers initial costs; uninsured motorist bodily injury for costs exceeding PIP/MedPay limits, if available. |
| Damage to your vehicle | Uninsured motorist property damage coverage or collision coverage. |
If you don’t have personal injury protection, medical payments, uninsured motorist or collision coverage in your policy, you may have to cover your own medical bills and/or car repairs and sue the at-fault driver to try to recoup your expenses.
Your health insurance coverage may also help cover your medical bills after an accident, regardless of fault or your car insurance status. However, some health care plans have limits or restrictions on emergency medical care. Most also require you to pay deductibles and copayments, which can prove costly on their own.
What if you're not at fault for a car accident without insurance?
The financial consequences of being in a car accident without insurance are potentially less extreme when the accident is not your fault, but they can still be steep.
In most tort states, you can file a claim with the other person’s insurance company to cover your medical expenses and car repairs. If any disputes arise, you have to negotiate with the other person’s insurance company or hire an attorney because you won’t have your insurance company to handle the details for you.
If you live in a no-fault insurance state, you can still usually file a property damage liability claim with the at-fault driver’s insurance company to cover car repairs.
If you are injured without car insurance in a no-fault state, your initial medical bills typically come out of your own pocket, even if the other driver caused the accident. You may be able to recover some costs from the other driver if your medical bills are particularly costly.
Legal penalties for getting into an accident without insurance
Regardless of fault, getting into an accident without insurance also puts you at risk of legal penalties for violating your state’s insurance laws.
Most states require you to carry insurance, unless you can demonstrate financial responsibility through alternative means, such as by posting a bond. And you usually have to show proof of insurance or other financial responsibility to a law enforcement officer investigating an accident, whether it’s at the scene or at a later time.
The legal penalties for driving without insurance vary by state, but they usually include a fine, a suspension of your driver’s license and/or vehicle registration, and possible incarceration.
Most states also require you to pay additional fees to have your license and/or registration reinstated. And many also require SR-22 insurance for a specified number of years if you are caught driving without insurance.
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Can I settle a car accident without insurance?
Regardless of whether you have insurance or not, it’s possible, albeit risky, to settle a car accident without insurance.
If you do decide to settle without insurance, it’s best to consult with a legal expert for advice on the best way to handle potential medical injuries, repairs, payments and other details. If you have insurance, here are additional things to consider:
- Make sure you know the full extent of any injuries to yourself or damage to your vehicle before you agree to settle without insurance. A slight ache could be a symptom of a more serious medical issue. Vehicle damage that appears minor may be costly to repair if there is structural or mechanical damage beneath the surface.
- Find out if your insurance company requires you to report an accident within a certain amount of time. If you miss your insurance company’s requirement, you may not be able to file a claim later if you change your mind about settling privately.
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