What Happens if a Financed Car is Crashed?
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. Our car accident attorneys from the Law Offices of Wolf & Pravato represent injured victims of collisions. Call today for a free consultation: (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 the Florida 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, per Florida 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 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 with Florida 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
How Can an Attorney Help With My Florida Car Accident Case?
When one of our Florida accident attorneys represents a car crash victim, we fight for the appropriate compensation to help them get back on their feet. We file claims and/or lawsuits and pursue the money they need to pay for their bills and cover losses. We protect their rights and navigate this process for them.
In a fault-based case, we often settle without going to trial. However, our Miami car accident attorneys know how to litigate these cases and will present the client’s case before the judge and jury when it is in their best interests.
Discuss Your Options With Our Legal Team for Free
The 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.