When you crash a financed car, you will still need to pay your car note during the repairs or if the insurer totals the vehicle. Your collision insurance or the at-fault driver’s property damage liability coverage should kick in. This will cover some or all the costs necessary to get you back on the road.
If you have questions about your claims after a car crash in Florida, we can help. Ourcar accident attorneys from the Law Offices of Wolf & Pravato represent injured victims of collisions. Call today for a free consultation at (954) 633-8270.
Are You Still Responsible for Your Loan After Crashing a Financed Car?
If you crash a financed car, you are still responsible for paying the remainder of the loan. This could mean making payments while a body shop repairs the vehicle or paying off the car accident loan and replacing the car if the insurer totals it.
The good news is that banks generally require all purchasers to carry full coverage auto insurance on a financed car. This means you likely have some type of coverage regardless of the accident’s circumstances. This is how you will pay for repair or replacement. Your options could include the following:
- A Fault-Based Insurance Claim: According to theFlorida Department of Highway Safety and Motor Vehicles (FLHSMV), the state requires drivers to carry property damage liability coverage policies of up to $10,000. This pays for the damage to someone else’s vehicle in a crash the policyholder causes.
- Your Collision Coverage: Collision coverage is a no-fault policy that pays for the repair or replacement of your vehicle up to the policy’s maximum. You will likely need to pay a deductible.
- Gap Insurance: If you owe more than you receive in the payout and your car is totaled, you must cover this expense. Some people buy gap insurance to protect themselves in case this occurs.
Understanding what happens when they total a car is important. An insurance company will generally total a car when the cost to repair it is 80 percent or more of its current actual cash value, perFlorida Statutes § 319.30(3). This means they will pay you for the vehicle, and you sign the title over to the company.
When you agree to a payout, the insurance company will likely cut a check for your remaining balance—or the policy maximum—and send it directly to the bank or financing company. They will send any remaining money to you, which could become your down payment for your next vehicle.
What Happens If You wreck a Financed Car Without Insurance
If you wreck a financed car without insurance in Florida, you are still legally responsible for paying the loan—even if the vehicle is no longer drivable. Florida law requires drivers to carry at least property damage liability and personal injury protection (PIP), but if you let your coverage lapse or never had it, the entire financial burden falls on you. This means you must pay for repairs or continue making monthly loan payments on a totaled vehicle that you can’t use. In many cases, the lender may also repossess the car if you stop paying, leaving you without a vehicle and still owing money.
On top of this, you could also be personally liable for damages to the other driver’s vehicle, medical bills, or additional losses. Without insurance, these costs come directly out of your pocket, and the other driver could sue you to recover them. This situation can create long-term financial stress, especially since lenders and courts don’t excuse repayment just because the car is totaled. If you’re in this position, it’s important to speak with a Florida car accident lawyer who can explain your options and help you navigate your legal and financial responsibilities.
What About Other Damages in a Car Accident?
Some collisions only cause property damage. However, injuries are also possible. When someone gets hurt in a crash, they have additional expenses and losses to consider. Florida law is specific on how to pursue injury-related damages after a crash. The state requires all drivers to carry a personal injury protection (PIP) policy under its no-fault laws, beginning withFlorida Statutes § 627.730.
This law allows those with relatively minor and moderate injuries to get money faster and cover their medical bills and lost income more easily. These policies generally pay 80 percent of medical care and 60 percent of lost income, up to the policy maximum. The laws require at least $10,000 in coverage.
Sometimes, this simply is not enough. Victims suffer more serious injuries and require additional money to cover their losses. Some circumstances allow victims to sue the careless or reckless driver in a fault-based lawsuit. This could enable them to recover compensation that includes:
- Pain and suffering damages
- Medical bills, current and future
- Income losses
- Reduced ability to work and earn
- Property damages
Discuss Your Options With Our Legal Team for Free
Our Fort Lauderdale car accident lawyer team at the Law Offices of Wolf & Pravato provides free case reviews. We talk to crash victims in our service area to learn how we can help them get fair compensation for their medical expenses, lost income, crashed cars, and more.
We may be able to help you. If we take your case, we will protect your rights and interests as we pursue damages on your behalf. Call (954) 633-8270 or use our online form tocontact us today.
Frequently Asked Questions:
1. Am I still responsible for my car loan if my financed car is totaled in an accident?
Yes. Even if your car is totaled, you are legally required to continue paying your loan until it is fully paid off. Insurance may cover part of it, but any remaining balance is your responsibility.
2. What insurance do I need to protect a financed car in Florida?
Banks usually require full coverage, which includes collision and liability insurance. Gap insurance is optional but recommended if you owe more than the car’s current value.
3. Can I be sued for damages if I crash my financed car without insurance?
Yes. If you don’t have insurance, you could be personally liable for property damage, medical bills, and other costs incurred by others in the accident.
4. How does a car total payout work with a financed vehicle?
If your car is totaled, the insurance company typically pays the lender directly. Any remaining funds may be sent to you, which can be used toward a new car or other expenses.
5. What should I do if I can’t afford my car loan after an accident?
Contact a Florida car accident attorney immediately. They can advise on options, protect your legal rights, and help you navigate negotiations with the lender and insurance company.
6. Does personal injury protection (PIP) cover my medical bills if I crash my financed car?
Yes. Florida requires PIP coverage, which helps pay for medical expenses and lost income for minor and moderate injuries, up to your policy limits.
7. What happens if I owe more on my car than the insurance payout?
If your payout is less than the loan balance, you are responsible for paying the remaining amount. Gap insurance can cover this difference if you have it.