If you’ve been involved in a car crash in New Jersey, you’re likely dealing with physical injuries, emotional trauma, and financial burdens. The outcomes of a car accident can be challenging, from seeking medical treatment and dealing with insurance companies to repairing or replacing your vehicle and coping with the emotional toll of the crash.
Filing a lawsuit against the defendant can help you seek compensation for your losses, including medical expenses, lost wages, property damage, and pain and suffering.
But have you wondered how this will affect the defendant, especially if they have insurance? In this article, we’ll explore the implications of a car crash lawsuit on the defendant, assuming they have insurance.
Understanding the Basics of Car Insurance in New Jersey
In New Jersey, all drivers, including those residing in densely populated areas like Cherry Hill, Newark, Jersey City, or Elizabeth, are required to carry a minimum level of automobile insurance coverage. This includes liability insurance, which is designed to protect insured drivers from financial losses if they cause an accident and are found legally responsible for the resulting damages.
According to the New Jersey Department of Banking and Insurance, over 96% of drivers in the state maintain liability insurance coverage. This highlights the prevalence of car insurance and its role in protecting drivers financially. As Cherry Hill car accident lawyer Adam Rosengard emphasizes, “With busy highways and congested roads throughout New Jersey, having proper car insurance is not just a legal requirement, it’s a safeguard against unforeseen accidents and the financial burdens they can cause.”
When you file a lawsuit against the at-fault driver, their insurance company typically steps in to defend the case and cover any potential damages awarded, up to the policy limits. This means that the financial burden of the lawsuit may not fall directly on the defendant, but rather on their insurance provider.
The Role of Insurance in a Lawsuit
In a car crash lawsuit in New Jersey, insurance plays a crucial role for both the plaintiff and the defendant. Whether you’re from Newark, Jersey City, or any other city in the Garden State, understanding how insurance works in a car crash lawsuit is essential. For the defendant, insurance coverage can provide financial protection by covering the costs associated with legal representation and any potential damages awarded to the plaintiff.
This can include medical expenses, lost wages, property damage, and pain and suffering. It is important to note that insurance coverage may have limits, and any amount exceeding those limits may become the defendant’s responsibility. For example, if the defendant’s insurance policy has a liability limit of $100,000, but the plaintiff is awarded $200,000 in damages, the defendant may be personally responsible for paying the remaining $100,000.
In New Jersey, where car insurance is mandatory, understanding the role of insurance in a car crash lawsuit can help you handle the legal process and ensure you receive fair compensation for your losses.
How the Lawsuit Affects the Defendant With Insurance
While having insurance coverage can provide a layer of protection for the defendant, being involved in a lawsuit can still have some implications:
1. Increased Insurance Premiums
If the defendant’s insurance company has to pay out a claim as a result of the lawsuit, the defendant’s insurance premiums will likely increase upon policy renewal. The amount of the increase will depend on various factors, including the severity of the accident and the damages awarded.
2. Potential Out-of-Pocket Expenses
In some cases, the damages awarded in a lawsuit may exceed the defendant’s insurance policy limits. If this occurs, the defendant may be personally responsible for paying the remaining balance out of their pocket.
3. Impact on Driving Record
Depending on the circumstances of the accident and the outcome of the lawsuit, the defendant’s driving record may be affected. This could potentially lead to higher insurance rates or even the possibility of having their license suspended or revoked in severe cases.
The Importance of Adequate Insurance Coverage
Given the potential financial implications of a lawsuit, drivers must carry adequate insurance coverage. In New Jersey, the minimum liability insurance requirements are:
- $15,000 for bodily injury or death of one person
- $30,000 for bodily injury or death of more than one person
- $5,000 for property damage
However, these minimum limits may not be sufficient to cover the damages in more severe accidents. It’s generally recommended to purchase higher liability limits or consider additional coverage options, such as umbrella policies, to provide greater protection in the event of a lawsuit.
FAQs
Can the defendant be held personally liable if they don’t have insurance?
Yes, if the defendant doesn’t have insurance coverage or if the damages exceed their policy limits, they may be held personally liable for any remaining damages awarded in the lawsuit.
Will the defendant’s insurance rates increase even if the lawsuit is unsuccessful?
In most cases, if the lawsuit is unsuccessful and no damages are awarded, the defendant’s insurance rates should not be impacted. However, the insurance company may still consider the incident when evaluating future policy renewals.
Can the defendant’s insurance company deny coverage or refuse to defend them in the lawsuit?
Insurance companies must defend their policyholders in lawsuits related to covered claims. However, there may be instances where coverage is denied or the defense is refused, such as if the policyholder failed to disclose relevant information or violated the terms of the policy.
Conclusion
In New Jersey car crash lawsuits, the extent of the defendant’s insurance coverage impacts their involvement in the case. Obtaining insurance safeguards finances, but comes with potential consequences, including increased premiums, potential out-of-pocket expenses, and consequences for driving records.
An experienced personal injury attorney can protect your rights, secure fair compensation, and consider defending party consequences.
