What should I do if I was involved in a car accident for which I was at fault?

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What should I do if I was involved in a car accident for which I was at fault?

I rear-ended a car. I don’t have any insurance so I asked if I could pay the driver personally. They agreed but now their insurance company are calling me asking for me to pay money. The driver only wants $1000 but the insurance company are asking for $8,000. Who should I pay?

Asked on January 15, 2016 under Accident Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

DON'T pay the driver if the insurer is also asking for money. If the insurer paid him $8,000, they can look to get that money from you--and if you also pay him $1,000, you'll have paid $9,000 total. If you pay someone money without getting a signed settlement agreement stating that the payment is in full satisfaction of all claims and that they they will indemnify you (pay for you or reimburse you) if anyone else (like their insurer) tries to bring a claim against you resulting from the accident, paying them is throwing money away: they can take the money, then sue you for more, or their insurer can sue you. You need the written, signed agreement entered into *before* you pay to protect yourself.
At this point, if the insurer is also seeking money from you, you'd have to settle with the insurer as well--it's likely too late to just settle with the driver. You can try to negotiate an amount of payment you can afford and are comfortable with, but make them prove what they are entitled to: the insurer should provide proof of the amount they paid out and for what; and if the insurer paid the driver, he should send you proof of his deductdible, because he should only get his deductible at most, not any amounts already paid by his insurance.


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