The United States is a collection of 50 different states with 50 different sets of crash-related laws. Regarding auto insurance, states generally fall into one of two categories: fault states and no-fault states.


The Basics of Auto Insurance Law

There are three main parties to an insurance policy: 

• The first party is the policyholder (i.e., the person who purchases the insurance policy); 

• The second party is the insurance company; and 

• The third party is a person injured by the first party. 

Automobile liability insurance is third-party insurance. Policyholders purchase third-party insurance to protect themselves when they cause damage or injury to a third party. When a policyholder injures a third party, the third party files a claim against the policyholder’s liability policy. The policyholder’s insurer will evaluate the claim and attempt to facilitate a settlement with the third party in exchange for a release. 

Policyholders purchase first-party insurance to cover losses or damage to their person or property. Uninsured motorist coverage (“UM/UIM”) and personal injury protection (“PIP”) are examples of first-party insurance. When a policyholder suffers a loss, the policyholder files a claim with his or her insurance provider. The insurance policy and applicable state and federal law govern the policyholder’s rights and remedies in a first-party claim.

Texas is a Fault-Based State

Texas is a fault-based state. This status has two implications. First, all Texas drivers must maintain a minimum level of liability coverage designed to cover damages the driver may cause a third party to incur. Second, an injured victim must prove that the at-fault driver is legally responsible for causing the collision to recover damages from the driver’s automobile liability policy. 

In contrast, some states—like Florida—are no-fault states. Generally, these states do not require their drivers to maintain liability insurance or prove that the other party caused the accident. Instead, no-fault states require their drivers to purchase first-party, no-fault insurance, like PIP. In these states, an injured person files a claim under his or her insurance policy, even if that person did not cause the collision. Since injured victims in no-fault states file claims under their insurance policies, the parties do not spend the same time and effort evaluating fault as parties would in a fault-based state.

Call an Experienced Accident Attorney Immediately After a Car Crash

Proving that another driver was negligent or that the driver’s negligence caused damages is not always straightforward. To make it harder, Texas liability insurers need not act in good faith when negotiating or settling claims. These two factors can make it challenging to convince an insurance adjuster to pay a liability claim’s full value. A good injury lawyer can help by navigating the claims process, establishing that the at-fault driver’s negligence caused damages, and filing a lawsuit if the proposed settlement is unreasonably low.

If someone else’s negligence injures you or a loved one, you have enough things to worry about. Do not let dealing with the at-fault driver’s insurance company be one of them. We deal with the insurance company so you can focus on getting your life back to normal. You have one chance to do this; make the right choice by choosing the right attorney. Call us at (956) 291-7870 or email us at contact@rdjlawyer.com for a free consultation and case evaluation.