Who Pays for Car Accident Compensation in Texas?

Texas is a “fault” state for car accidents. So, the driver who caused the crash (and their insurance company) is liable for damages.

Texas applies a modified comparative negligence standard with a 51 percent rule to determine compensation. This means that fault for the accident is divided among those involved. If you are found to be 51 percent or more at fault, you cannot file a claim.

If you are 50 percent or less at fault, your compensation will be reduced by the degree or percentage to which you contributed to causing the accident. For example, if you are 30 percent at fault, you will receive 70 percent of the settlement.

Your Texas car accident attorney can fight to protect you from taking more blame – and less compensation – than you deserve.

The amount of available insurance is a critical factor in compensation for most car accident injury claims.

To legally drive in Texas, you must be able to prove that you can pay for damages if you cause a crash. Most people do this by purchasing liability car insurance. Like most, the Lone Star State has set minimum standards for coverage. Typically, you must carry $30,000 per person and $60,000 per accident for bodily injuries, and $25,000 for property damage. This is known as 30/60/25 coverage. 

PIP - In general, Texas car insurance policies come with PIP (personal injury protection). PIP covers medical expenses as well as lost wages and other nonmedical costs. If you don’t want this coverage, you must notify the insurance company in writing.

UIM - It is highly recommended that you purchase uninsured/underinsured motorist coverage (UIM), too. This policy compensates accident victims when the liable driver doesn’t have insurance or doesn’t have enough coverage for you to be made whole. It can also be applied to hit and run accidents in which the at-fault driver is not found. If you do not have UIM, you can only hope the negligent party that injured you is identified and wealthy enough to make a civil lawsuit worthwhile. This is rarely the case. In Texas, if you do not want UIM coverage, you must opt out in writing.

Other optional types of Texas car insurance include:

• Collision - Pays to repair or replace your vehicle.
• Comprehensive (other than collision) - If your car is stolen or damaged by fire, flood, vandalism, or something other than a collision, this policy pays for damages.
• Medical payments (MedPay) - This covers medical bills for you and your passenger(s) in the event of a crash. It may be accessed if you are injured in someone else’s car or are a pedestrian or cyclist.
• Towing and labor – This insurance covers vehicle towing when your car, truck, or motorcycle can’t be driven. It also pays for labor to change a flat tire, jump-start a battery, or otherwise get you back on the road.
• Rental reimbursement - While your vehicle is being repaired after a crash, this coverage will pay for a rental vehicle. Some policies also cover taxis or rideshares like Uber and Lyft.

If there isn’t enough insurance available to pay for a car accident, then in principle, you can seek compensation from the at-fault driver’s assets. However, this is usually impractical.

Because Texas is a “fault” or “tort” state, yes, in general, you can file a lawsuit after an accident. However, this may not be your most effective option. In general, you have three options to recover injury compensation following a Texas car accident:

• File a first party claim with your own insurance company. This would apply when you want to access your own policies like PIP, MedPay, or UIM coverage.
• File a claim with the at-fault driver’s insurance company (a third-party claim).
• File a car accident lawsuit against the driver.

In general, the Texas statute of limitations (legal time limit to submit a lawsuit) to file an injury- or fatal-car accident claim is two years from the date of the accident.

This may seem like a lot of time, but it is critical to your case - and, ultimately, your compensation - that you contact a lawyer and get started on your claim as soon as possible. Evidence can be erased, lost, or destroyed, and witness memories can fade. Your car accident attorney will start investigating your accident right away to secure this evidence.

Figuring out the right option after a Texas car accident can be difficult. There are many factors influencing which option to choose. An experienced car accident lawyer can determine the most effective path to recovery.

The value of a car accident claim largely depends on the severity of your injuries and how they affect your daily life. Basically, there are two types of car accident damages - economic and non-economic.

Economic damages are objectively verified losses that can be tied to a specific dollar amount. They include:

• Medical expenses – Past, present, and future. You should be compensated for accident-related appointments with doctors and specialists, surgeries, physical therapy, and massage therapy, among other treatments.
• Lost wages – Due to time off for accident-related recovery.
• Lost future income – If your injuries reduce your ability to make a living, you should be compensated.
• Replacement services – When a crash prevents you from doing your normal daily tasks, you may need to hire replacement services. This includes home cleaning, yard work, childcare, and so on. If you need services, you should be compensated.
• Modifications to home or property – When accidents lead to temporary or permanent damage, it may be necessary to modify your home or other property to accommodate your new abilities.
• Property damage – To your vehicle and other property damaged in the crash.

Noneconomic damages are awarded for less tangible, but still serious damage like:

• Pain and suffering.
• Emotional distress.
• Loss of quality and enjoyment of life.
• Loss of consortium (a legal term for loss of intimacy in a family relationship).

In rare cases, accident victims and their families are awarded punitive damages. Sometimes called “exemplary damages,” this compensation is in addition to your economic and noneconomic damages. Punitive damages are intended to punish egregious, negligent, or reckless acts and send a discouraging message to would-be violators.

One of the benefits of having an attorney represent your accident claim is their ability to calculate an accurate compensation package that considers past, current, and future medical treatments, needs, disabilities, and other expenses related to your accident.

If the driver who hit you doesn’t have any, or enough, insurance to cover your damages, you can turn to your uninsured/underinsured motorist policy (UIM). This coverage is typically included in your Texas car insurance policy. If you don’t want UIM, you must decline the coverage in writing. It is highly recommended that you purchase UIM, which can also be applied in hit-and-run situations.

However, even when there is plenty of insurance coverage available, it doesn’t mean the insurance company will make you a fair settlement offer. An attorney can investigate the accident and make an argument for compensation that the insurance company cannot ignore.