Car owners need to understand liability laws when they decide to loan out their vehicle to prepare for the possibility that the borrower could be involved in an unforeseen car accident. Owners will want to make sure they are adequately protected from liability in the event the person they lend their vehicle to causes an accident.
Car Insurance In New Jersey
It’s a common misconception that car insurance is attached to the driver who owns the policy rather than the vehicle the policy covers. In contrast, insurance follows the vehicle that is insured regardless of who is in control of the car. It’s crucial for car owners to understand that loaning out their car also means loaning out your car insurance policy. If you willingly allow someone to drive your car, then you are ultimately taking responsibility for their actions by having your car insurance policy insure that other person in the event they cause an accident with your vehicle. This is true even if the person you lend your car to has an insurance policy for their own vehicles, and even if the insurance they have for their own vehicles offers greater coverage than your policy. Even if someone you lend your vehicle to causes an accident, your insurance premiums will likely go up since it is your policy that will have to pay out for injuries and damages caused by the accident despite the fact you weren’t the one who caused the accident.
It is also important to know who you are loaning your vehicle out to and what limits the terms of your car insurance policy place on loaning your car out to others. Although it is true that car insurance follows the vehicle when it is loaned out by the owner, some insurance companies place limits on this. For example, some insurance policies may require you to have someone living in the same household as you (such as a roommate or a romantic partner) to be a named insured if they drive your vehicle; if they aren’t named on your car insurance policy and get into an accident with your vehicle, the insurance company may deny coverage under an exclusion in your policy.
Liability Laws in New Jersey
New Jersey’s laws require drivers to carry personal injury protection insurance that will help go towards medical bills when someone is injured in an accident. This insurance can be used regardless of who is at fault, but this type of protection does follow the driver and not the car. If someone borrowed your car, then they may have their own personal injury protection insurance that will cover them. If not, then you may be held liable under the personal injury protection coverage in your own policy.
In a car accident, if the injured party’s damages exceeds the amount of the at-fault party’s insurance coverage, they may choose to pursue damages directly from the at-fault driver, since it was the driver, not the insurance company, that caused the accident. When you loan your car out to someone else, the person you loan your car out to will still be liable for his or her negligence or recklessness in causing the accident. However, someone who was injured in the accident might also pursue a direct claim against you as well under a theory that you negligently loaned your vehicle out to someone who got into an accident. You might be found negligent for loaning out your car if it can be proven that you knew or should have known that the person you loaned your vehicle out to posed a substantial risk of causing an accident — for example, if they frequently get into car accidents.
What to Do If You Lend Out Your Vehicle to Someone Who Causes an Accident?
There are a number of steps you need to take after you or a friend has been involved in a car accident in your vehicle that will help protect your rights.
First, you should be sure that someone takes photographs or video of the accident scene; these photos or video can later help an accident reconstruction expert determine how the accident occurred and offer an opinion as to who was at fault — it may turn out that the person you loaned your car out to wasn’t at fault for the accident.
You should also be sure to get a copy of the police accident report, which may contain critical evidence about the accident, whether anyone was cited or arrested for the accident, and possibly the officer’s opinion as to who was at fault.
You should also contact your own insurance company as soon as possible to notify them of the accident. Your policy may require you to give notice within a certain time frame; an untimely notice may entitle the insurance company to deny your claim.
Finally, you should also review the terms of your friend’s auto insurance policy, if they have one, to determine whether their insurance can provide any coverage for the accident (such as personal injury protection coverage).
Contact a East Orange Personal Injury Lawyer to Discuss Your Car Accident Case in New Jersey
Did you or a loved one sustain serious injuries due to a car accident in New Jersey? Don’t let the medical bills pile up while you wait for the negligent party or their insurance company to do the right thing. Right now, you need an aggressive personal injury attorney on your side, fighting to get you the compensation you need, want, and deserve. The skilled attorneys at Karim Arzadi Law Office represent clients injured because of car accidents in Vineland, New Brunswick, Hoboken, Newark, and throughout New Jersey. Call (732) 442-5900 or fill out our online contact form to schedule a free consultation about your case. We have an office conveniently located at 163 Market St., Perth Amboy, NJ 08861, as well as offices in New Brunswick, Roselle, East Orange, Jersey City, Elizabeth, Linden, Newark, Paterson, South Amboy, and Trenton.
The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.