Suing Uninsured Drivers in Texas

According to a March 2021 report released by Insurance Research Council, 1 in 8 drivers in the United States are uninsured. The number in a major city like Houston is even higher than the state average.  If you drive regularly in the Houston area, you or someone in your family are likely to be hit by an uninsured driver at some point during your lifetime. So, what happens when you are hit by an uninsured driver in Texas? This blog is aimed at answering the common questions that arise after you are hit by an uninsured driver.

Can I sue a driver who hits me but has no insurance in Texas?

You can sue a Texas driver who causes an accident but fails to carry liability insurance. However, even while suing uninsured drivers in Texas is possible, there is a strong likelihood that the driver will be judgment proof. As a result, you may have to file in small claims court on your own.

Why won’t a lawyer take my case against an uninsured driver who hit me?

Personal injury lawyers working on a contingency must weigh a lot of factors before investing their time and money into a lawsuit, including the amount it will cost and the likelihood of not just taking a judgment in court but also collecting on it. Getting back their investment and getting their fee is contingent upon a judgment being both taken and collected upon. There is almost zero likelihood of recovering a judgment against most uninsured drivers in Texas because they are judgment proof. Thus, unless there is other available insurance or assets, an attorney is unlikely to throw good money after bad for a judgment that is not worth the paper it is written on.

What does is mean when someone is judgment proof?

A person is said to be ‘judgment proof’ when they have insufficient assets that the law will allow to be seized and sold to pay a judgment. In Texas, there are two sets of laws that affect a person’s ability to collect a judgment against an individual. Texas Property Code sections 41.0001-42.0002 define which assets cannot be seized by a judgment creditor in order to pay off a debt. These assets are referred to as the debtor’s Homestead.  This includes:

  • an urban home and 10-acre lot or a rural home and 100-200 acre lot;
  • a burial lot;
  •  home furnishings, including family heirlooms;
  •  food for consumption;
  • farming or ranching vehicles and implements;
  • tools of one’s trade including equipment, books, and special vehicles used in a trade or profession;
  • clothing;
  • certain jewelry;
  • two firearms;
  • athletic and sporting equipment, including bicycles;
  • a two-wheeled, three-wheeled, or four-wheeled motor vehicle for each member of a family or single adult who holds a driver’s license or who does not hold a driver’s license but who relies on another person to operate the vehicle for the benefit of the unlicensed person;
  • Certain animals and their food including:
    • two horses, mules, or donkeys and a saddle, blanket, and bridle for each;
    • 12 head of cattle;
    • 60 head of other types of livestock;
    • 120 fowl, and;
    •  household pets.
  • Other personal property with a combined value of up to $50,000 for a single person and $100,000 for a family.

Most of the people who cannot afford to or are not responsible enough to carry the liability insurance required by law do not own property over and above all the items listed above. Thus, shielding their assets from collection is not that hard.

Even for people who have some assets that can be seized, the typical retainer to hire a bankruptcy lawyer and file bankruptcy is around $2000-5000.  May debts, including judgment liens, can be dismissed in bankruptcy court for pennies on the dollar.  Further, the time and hassle of dealing with bankruptcy court only to get a small fraction of the judgment can discourage both litigants and attorneys from wanting to spend 100s of hours litigating ad chasing a judgment.

What can I recover from a driver who hits me but has no insurance?

Unless the other driver has assets over and above those that are protected by the Texas Homestead Act, it is unlikely that you can recover anything from an uninsured diver.

How can I get my vehicle fixed if the at-fault driver had no insurance in Texas?

When the other driver does not have insurance or assets upon which you can collect, you generally must look to your own means to fix your vehicle. The first place to look is your own auto insurance. If you carry full coverage, then your insurance must pay to repair the vehicle even though the other driver was at fault. If you do not have full coverage, then you can look to the Uninsured Motorist Coverage section on your policy. Uninsured Motorist Coverage is optional insurance coverage that you must be offered by law but can waive or purchase.  It can be purchased in various amounts. Assuming you did not reject/waive this coverage, you can file for both the vehicle damage and your bodily injuries. Each of those claims will have separate limits of coverage that depend upon how much you purchased to protect yourself. If you chose to carry neither full coverage nor uninsured motorist coverage, then you will likely have to pay for your own vehicle repairs.

How can I get my medical bills paid if the at-fault driver has no insurance?

When the at-fault driver has no insurance, you usually must look to your own insurance or come out-of-pocket to fix your vehicle. there are two types of coverage you may have on your own policy to cover the medical bills you incur.  Uninsured Motorist Insurance will cover medical expenses up to the limit you purchase (assuming you did not reject this coverage.)  Also, many policies have a small amount of coverage specifically for medical expenses. This section will either be MedPay Coverage or Personal Injury Protection (PIP) Coverage.  Either of these will cover medical bills up to their limit but PIP also covers lost wages.  They tend to be very small compared to other limits, but it is worth looking.

Can I sue an at-fault driver who has insurance, but the policy limits are not enough to cover my damages?

If you have accepted the policy limits from the other driver’s insurance company, you can no longer sue the at-fault driver. The insurance company can only give you those limits in exchange for a full and final release of liability of their insured. If you have Underinsured Motorist Insurance on your auto policy, then you can pursue your own policy up to its limits for any uncovered damages. If you have not accepted the other driver’s insurance policy limits, then you may reject their limits and pursue the individual directly. However, if that person is judgment proof, you will likely be spending more than you will recover.

Final Thoughts

The Texas Homestead Act and Bankruptcy laws act as a shield that makes it very difficult to collect a judgment against an individual who has no insurance and minimal assets. Personal injury attorneys who work on a contingency fee take and fund cases on the premise that there is an expectation of a future recovery. There can be no such expectation when the target defendant is judgment proof. Thus, it is important to carry and look to Uninsured and Uninsured Motorist Coverage on your Texas auto policy.

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