Understanding the types of insurance coverage is crucial for car accident claims in North Carolina. Here’s what you need to know:

Liability Insurance

In North Carolina, liability insurance is mandatory and plays a crucial role in protecting other drivers and individuals if you cause an accident.

Liability insurance will usually cover vehicle damage, personal property damage, medical expenses for victims, lost wages, and compensation for pain and suffering. These expenses can add up fast. If your insurance falls short, victims have the right to pursue a judgment against your personal assets, which could involve a lien on your home or garnishment of your bank account.

To successfully collect from another driver’s insurance, you must demonstrate their negligence while proving that you did not contribute in any way to the accident, in line with North Carolina’s contributory negligence law. Moreover, it’s wise to consider the possibility of stacked policies. Since liability insurance follows the vehicle and not the driver, the vehicle insurance will respond first to the claim. However, it may not be the only coverage available. Always examine all potential liability coverage options, including those for work vehicles and company policies, before signing any settlement.

Uninsured Motorist Insurance

Uninsured motorist insurance covers any claims for victims injured by uninsured drivers or those involved in hit-and-run accidents. It effectively addresses damages to your car and personal property, with the possible exception of hit-and-run cases, where property damage claims require contact. Without contact, say you are run off the road and damage your car, while it isn’t your fault, it’s not classified as a hit-and-run, and property damage falls under collision insurance.

Under this type of claim, insurance companies may challenge medical payments and will often represent the uninsured motorist in court to limit their payouts. If the other driver lacks liability coverage, uninsured motorist insurance becomes your only avenue for recovery other than a lawsuit.

We cannot stress enough that under North Carolina’s contributory negligence laws, admitting any fault can result in disqualification from payouts. However, payments made under an uninsured motorist policy will not raise your premiums, as this is equivalent to being found faultless. Moreover, our stackable policies allow you to combine coverages, so be sure to explore your vehicle, personal, and household policies to maximize your protection.

Underinsured Motorist Insurance

Underinsured motorist coverage is an essential protection that operates similarly to uninsured motorist coverage, but specifically for drivers with inadequate liability insurance.

To calculate your potential recovery, simply follow these steps:

1. Add the total liability limits from the at-fault driver’s policies you can recover and your underinsured limits from your policy.

2. Subtract the total liability amount from the underinsured total to find the recoverable amount from your insurance, in addition to any payment you receive from the at-fault driver.

This coverage ensures that you have the means to recover additional funds when the at-fault driver’s liability insurance falls short.

Collision Insurance

Pays for your vehicle repair or replacement if the accident was partially or fully your fault.

Medical Insurance (Med Pay)

MedPay, or Medical Payments Coverage, is an optional type of health insurance that can be added to your auto policy. This coverage pays for medical expenses for you and your passengers after an accident, regardless of who is at fault, up to a specified per-person limit, which is typically determined by your policy. Using MedPay to cover medical expenses will not affect your premiums, even if you are at fault for the accident. However, it’s important to note that while the accident may impact your premiums, the medical claim itself will not.

MedPay does allow for duplicate payments, meaning you can collect from health insurance, MedPay, and at-fault liability. Keep in mind that if you use your health insurance, you may be required to reimburse them later, so it’s a good idea to check with your provider.

Note: Be sure to review common exclusions for MedPay, such as pre-existing conditions or intentional injuries.

Personal Injury Protection (PIP)

Not underwritten in North Carolina.

Rental Reimbursement Coverage

Rental Car Reimbursement is optional but extremely convenient coverage. If the accident is not your fault, the liability insurance of the other driver will cover the rental vehicle expenses. If you decide to use your own policy, the minimum coverage limit for rental expenses is $30 per day for up to 30 days. After this period, you will be responsible for any additional rental costs. Additional coverage packages increase in duration as well as expenses allowed per day.

An Additional Note on NC Auto Insurance

North Carolina law requires minimum liability limits of $30,000 per person/$60,000 per accident for bodily injury and $25,000 per accident for property damage, typically known as 30/60/25, to ensure basic coverage for accidents. Victims typically have 3 years to file personal injury claims in North Carolina, so act quickly to protect your rights.

North Carolina follows a contributory negligence rule, meaning if you’re even slightly at fault (1% or more) in a car accident, you could be barred from recovering any damages. This strict law significantly impacts car accident claims, especially when dealing with insurance, total losses, or repairs, so understanding its implications is crucial.

Possible Defenses to Contributory Negligence:

• Non-Causative Negligence: If your negligence did not directly cause the accident, like a minor traffic violation unrelated to the crash, this defense can argue that you shouldn’t be barred from recovery.
• Gross Negligence: If the other party’s negligence was extreme or reckless, such as driving drunk at high speed, it may outweigh your minor fault, allowing you to recover damages.
• Last Clear Chance: If the other driver had the last clear chance to avoid the accident but failed to, you might still recover, even if you were partially at fault.

Don’t give up on the recovery you deserve! Contact Dummit Fradin for knowledgeable guidance on defending your claim and securing the compensation you deserve.

There are steps you must take after a vehicle accident by law. Many of these overlap with the following list, but some do not. Taking a few additional precautions to preserve your claim immediately after a car accident can ensure you recover what you’re entitled to. Here’s a checklist:

• Call the police to document the scene and file a report.
• Seek medical attention immediately, even if injuries seem minor:
  • Report every problem to your medical provider.
  • Attend all scheduled medical appointments.
  • Keep all medical records, bills, and receipts for pharmacy care, travel expenses, loss of work time and wages, long-term loss of income, out-of-pocket expenses, any permanent injuries, and future medical care costs, etc.
  • Photograph any visible cuts, bruises, or serious injuries, and continue photographing through the healing process.
  • Use your personal health insurance to pay for care whenever possible.
• Gather Evidence:
  • Take photos of the scene, vehicles, and injuries from all angles, including the road.
  • Capture first responders’ actions.
  • Take vehicle photos from several angles and distances, including the interior.
  • Collect witness contact information.
• Secure witness identification: Get contact info from anyone who stops to help, as they can provide testimony later.
• Secure and review all police contact info and reports: Record names and contact details of all responding officers and obtain/review the police report, correcting any name errors early.
• Preserve all physical evidence, such as damaged clothing or vehicle parts, until reviewed by your attorney.
• Report your claims to any insurance carriers.
• Do not provide any written or recorded testimony to insurance adjusters.
• Do not sign medical authorizations for insurance adjusters.
• When discussing with adjusters, focus only on property damage and accident facts; never admit to speeding, driving errors, or any other fault.
• Hire an attorney quickly and allow them to handle all claims to meet deadlines and protect your rights.

Vehicles are becoming increasingly expensive due to higher budgets for purchase, maintenance, and repairs.  It is important to know the law forces insurance companies to pay fairly for property damage claims, but determining what “fair” means in car accident cases is where an experienced personal injury attorney can make all the difference in your recovery. Understanding how an accident claim progresses can help you preserve and maximize your case.

Definition of Terms

Total Loss: In North Carolina, a vehicle is a total loss if repair costs exceed 75% of its pre-accident Fair Market Value (FMV), making it more economical for the insurance company to pay out the car’s value rather than repair it. Generally, the Fair Market Value of a vehicle will be determined by the Kelley Blue Book Value or similar.

Repairable Damage: Damage to a vehicle that can be fixed and returned to a safe, operable condition, with repair costs being less than 75% of the car’s pre-accident FMV.

Salvage Title: A title issued for a vehicle deemed a total loss, indicating it has significant damage and may not be safe or legal to drive until repaired and inspected. This title affects the car’s resale value and insurability.

Diminished Value: The reduction in a vehicle’s market value after an accident, even if repaired, due to its history of damage. This loss can be claimed as part of your recovery, especially if the vehicle is repairable but less valuable.

As stated above, insurance companies assess whether a vehicle is a total loss or repairable by comparing the estimated repair costs to the car’s pre-accident Fair Market Value. In North Carolina, the vehicle is declared a total loss if the total repair costs (including rental, towing, storage expenses, and any diminished value claim) exceed 75% of the pre-accident FMV. This is a simple yes-no calculation, and there is generally little way to dispute this determination.

How much an insurance company will pay is an entirely different question. This amount is called your vehicle’s Actual Cash Value (ACV). Determining this number begins with the Fair Market Value and is then adjusted based on specific data used by the insurance industry. Generally, the ACV is calculated by loss adjusters and accounts for the condition of your vehicle at the time of the accident, the availability of cars like yours, damage assessments from auto body shops and engineers, and market value data. If the vehicle is deemed repairable, insurance companies approve repairs based on quotes and ensure safety standards are met before releasing funds.

The goal for the insurance company is to pay the cheaper option:

1. The costs of rental, towing, storage, any diminishment in value, plus repairs or
2. The Actual Cash Value of the car and any costs already paid out before the total loss is declared (for rental, storage, and towing).

Disputes can arise if owners disagree with the insurance company’s valuation over either the diminished value of the vehicle (loss of value due to the accident) or ACV (what the car was worth before the accident).

Note: Actual Cash Value and Fair Market Value are not the same thing. The Actual Cash Value is more researched and specific to the vehicle and the local market than the Fair Market Value. Therefore, insurance companies are hesitant to compromise on this. However, they are legally required to disclose their research, which isn’t necessarily accurate. The Personal Injury Team at Dummit Fradin is highly experienced in challenging this research. We have working relationships with experts in the field who regularly conduct their own assessments and ensure clients receive fair payments for their property.

Salvage Vehicle Titles: If your vehicle is deemed a total loss by the insurance company, they will generally want to pay you for the ACV of your vehicle, and then sell your wrecked car at auction to try and recoup some of their funds. However, you, as the vehicle owner, have the right to retain the salvage if you decide to do so. Simply inform the company, and they will reduce your total loss payment by the amount of the salvage estimate and inform the DMV. You will receive a salvage title. Having a salvage title will significantly reduce the resale value of your vehicle should you decide to repair and sell it or trade it in the future.

Unique Vehicle Cases: For classic, custom, or high-value vehicles, standard ACV calculations will substantially undervalue them. In these cases, provide documentation (like receipts and expert appraisals) to prove a higher pre-accident value. We strongly suggest seeking proven legal advice from an experienced personal injury attorney to ensure a fair recovery.

Notes on Diminished Value Claims: This is the loss of the vehicle’s resale value due to its being in an accident. It is a separate claim filed under the at-fault driver’s liability insurance, and one often disputed. Many insurance companies argue that wrecks and subsequent repairs are built into the life of the vehicle since they are doing exactly as designed, crumpling in the proper zones and being repaired with no loss of mechanical, cosmetic, or technical operation. Therefore, they won’t offer a payment for diminished value after 5 model years, “the life of the vehicle,” and it is generally small.

In North Carolina, it must be disclosed at the time of sale if a car has been involved in a wreck that required repairs of 25% or more of the FMV of the vehicle. So, many insurance companies in NC try to limit the diminished value claims they will honor to only those of newer vehicles with extensive repairs, which weren’t totaled. An experienced attorney with decades of experience dealing with insurance companies, adjusters, and appraisers knows exactly when and how to challenge these limits.

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Please note, the following is a very general overview for illustrative purposes only of how valuation disputes are handled. We do not recommend using this as a guide without legal representation. Each case is different, and an experienced attorney in injury and recovery law will be able to apply their knowledge of negotiation tactics and legal strategy within this framework to maximize your recovery.

Step 1: You and the insurance company cannot agree on the fair market value of your vehicle, both before and immediately after the accident.

Step 2: The difference between your opinion and the insurance company’s opinion of the value of your claim must be greater than either $2,000 or 25% of the fair market value of your car, whichever is less.

Step 3: You must send a request in writing to the insurance company to select an objective third-party appraiser.

Step 4: You must also obtain and pay for your own appraiser.

Step 5: You have to notify the insurance company of whom you selected.

Step 6: If those two appraisers can’t agree on the value, they must find a neutral third appraiser.

Step 7: The appraisers must submit their appraisals and the evidence they used in making those appraisals to the neutral third party. The third appraiser must prepare a report determining the amount of your loss and give it to you and the insurance company. The neutral third party shall make no determination of liability and must award damages that fall somewhere between the determinations of the two primary appraisers (the insurance company’s appraiser and the one you hired).

Step 8: You have 15 days to reject the determination. If no one rejects it, the report is binding and falls to the insurance company for final settlement.

Seek Legal Assistance: An attorney can help negotiate with insurance companies, challenge undervalued claims, ensure all damages are considered and all dispute deadlines are met, and protect your rights throughout the process.

Document Everything: Keep photos, repair estimates, insurance company communications, and receipts for all related costs (repairs, rentals, medical, towing, storage, etc.). Note the date and methods used to assess pre- and post-accident values, including salvage, to ensure fairness.

Get Multiple Quotes: Obtain at least two repair estimates for repairable vehicles to ensure fair pricing and quality. Get an independent appraisal to verify the insurer’s ACV and salvage value for total losses.

Review Insurance Policies: Check your policy for coverage details on total loss, repairs, rentals, and diminishment of value. Note any deadlines for claims or appeals.

Protect Your Rights: Avoid signing any settlements until all values are agreed upon, and your lawyer has been consulted to ensure full recovery.

1. Hire a proven Injury and Recovery Attorney. They have the skills to negotiate with the insurance companies on your behalf, can represent you in court, will collect valid evidence on your behalf, and ensure your recovery is maximized. We recommend the Team at Dummit Fradin’s Winston Salem – West End Office. Our Attorneys have decades of experience and hundreds of pleased customers across the Triad.
2. Do NOT admit fault – keep all conversations with insurance companies to property damage and brief facts about the accident. Because of North Carolina’s strict contributory negligence policy, if you are even 1% at fault in an accident, you will lose your claim to recovery from the 99% at-fault driver.
3. Do NOT give written or recorded testimony to or sign any medical authorizations for insurance companies without your attorney’s approval.
4. Find out which policy/policies will pay for the damage:
   1. The Other Driver’s Liability: If they are entirely at fault
   2. Underinsured Motorist: Their Liability won’t cover all expenses
   3. Uninsured Motorist: They have no insurance
   4. Comprehensive/Collision: The accident was partly/wholly your fault, or you were run off the road
   5.  Med Pay: Medical Insurance attached to your auto policy, covers you and passengers regardless of fault
   6. Rental Coverage: Kicks in when an accident is partly/wholly your fault, and you need a rental vehicle
5. Retain all receipts (repairs, towing, storage, medical, pharmacy, travel, etc.), photos of the scene and car (interior and exterior), contact information for responding officers and witnesses, and photos of any cuts, bruising, or other medical issues caused by the accident.
6. Read all applicable policies carefully for claims details, deadlines, and limits.
7. Keep all medical appointments and comply with all medical advice.
8. Obtain at least 2 quotes to ensure fairness.
9. Hire your own appraisers if you intend to dispute a valuation (salvage value, ACV, FMV, or diminished value), especially in the case of a classic, high-value, or custom vehicle
10. Keep records of any loss of wages, both current and future

Don’t try to navigate a complicated car accident claim alone. The Car Accident and Injury Team at Dummit Fradin is here to help simplify the process and recover the amount you deserve to help you move on with your life.