Car insurance question (policy-holder liability)

[mugs]

I have a friend who:
- Is 22 years old
- Owns her own car (title and registration are in her name)
- Lives with her mother and step-father (in NJ)
- Has her car insured on her step-father's policy

If she is at fault in an accident, and the damages are greater than her liability coverage, could her step-father be held liable for any damages?

Edit: Please explain why or why not

 

[Nocturnal]

Yes.

 

[AlienCraft]

You betcha. Big time. This is why being UNDER-Insured is as bad as no insurance at all.

 

[Kelvrick]

Yes, but I don't know why. Well, there is some legal mumbo jumbo that I don't know how to explain because I really don't know that well. All I know is where I work, we collect money from people like her step-dad in a lot of situations.

Best to get her own policy. Thats why when I moved away to college, my family basically severed all strings from me to them. Sounds cold, but it was the smart thing to do. Don't want them to lose their house if I start a chain accident or something.

 

[TwinkleToes77]

yep.. when my i was on my parents policy they had higher limits, because they had much more to lose if someone sued them. When i got my own i only had minimum because i didnt own anything other than my car.

 

[Double Trouble]

I'm not a lawyer, and I'm certainly not familiar with NJ laws, but I would have to guess that no, he would not be liable. The car is registered in her name, and she's an adult, which would mean that he probably can't be held liable for her actions. The fact that it's his insurance policy does not make him liable for her actions. It means he would have to pay deductibles etc, but I don't see any rationale for how he would be responsible for any excess damages unless he were somehow involved in the incident (for example, if he gave her a bunch of alcohol at his home and then she drove off and got in a crash).

 

[mugs]

Originally posted by: Kelvrick
Yes, but I don't know why. Well, there is some legal mumbo jumbo that I don't know how to explain because I really don't know that well. All I know is where I work, we collect money from people like her step-dad in a lot of situations.

Best to get her own policy. Thats why when I moved away to college, my family basically severed all strings from me to them. Sounds cold, but it was the smart thing to do. Don't want them to lose their house if I start a chain accident or something.

She's getting her own insurance in May when she has a clean record (her new insurance company won't accept her if she's had a ticket in the last 3 years).

My understanding was that when you get in an accident, the person who caused the accident is completely liable. The insurance company is just someone you have an agreement with to cover your liability up to a certain point. So if someone sued her and got $200,000, and her insurance company covers their share, SHE would still owe the remainder. I didn't think her step-father would be liable because his only tie to her is the insurance being in his name. If her car was in his name, or if she was under 18, I could definitely see him being liable.

 

[Double Trouble]

Originally posted by: mugsywwiii
My understanding was that when you get in an accident, the person who caused the accident is completely liable. The insurance company is just someone you have an agreement with to cover your liability up to a certain point. So if someone sued her and got $200,000, and her insurance company covers their share, SHE would still owe the remainder. I didn't think her step-father would be liable because his only tie to her is the insurance being in his name. If her car was in his name, or if she was under 18, I could definitely see him being liable.

Liability depends on the state laws. For example, some states have "comparative liability", which means you are liable to the degree that you were responsible for the accident (for exampe, 40% for one person, 60% for the other). Other states basically decide who is "most liable", and then assign 100% liability to that party. Either way, I don't see how the stepfather is in any way involved, other than having his insurance skyrocket afterwards

 

[Kelvrick]

She's getting her own insurance in May when she has a clean record (her new insurance company won't accept her if she's had a ticket in the last 3 years).

My understanding was that when you get in an accident, the person who caused the accident is completely liable. The insurance company is just someone you have an agreement with to cover your liability up to a certain point. So if someone sued her and got $200,000, and her insurance company covers their share, SHE would still owe the remainder. I didn't think her step-father would be liable because his only tie to her is the insurance being in his name. If her car was in his name, or if she was under 18, I could definitely see him being liable.

It doesn't always make sense when insurance companies are involved. Might be different over there ,but over here, they'll have a lawsuit filed in the step-dads named in no time. They do what they have to so they can get money. Just spoke to one of the attorneys here about it.

 

[AlienCraft]

Originally posted by: mugsywwiii She's getting her own insurance in May when she has a clean record (her new insurance company won't accept her if she's had a ticket in the last 3 years).

My understanding was that when you get in an accident, the person who caused the accident is completely liable. The insurance company is just someone you have an agreement with to cover your liability up to a certain point. So if someone sued her and got $200,000, and her insurance company covers their share, SHE would still owe the remainder. I didn't think her step-father would be liable because his only tie to her is the insurance being in his name. If her car was in his name, or if she was under 18, I could definitely see him being liable.

This is exactly why he would be FINANCIALLY liable. There may be a civic liability, if there was any criminal activity on the driver at fault, as well, if the injured party decides to sue. The insurance company filing suit doesn't care who pays, as long as they don't. They will go after anyone with assets, property, etc. in order to keep from having to pay out themselves.
If his name is the PRIME INSURED on the policy, there will be an overlap of exposure. There may be limits in the policy designed to keep the insurance company from being at risk too much.