What happens if I’m uninsured but not at fault?

You still have rights in a crash, even when you're uninsured.

A car accident is an extremely stressful event to go through and it's far worse when you don't have the security of a comprehensive car insurance policy backing you up. What should you do in an accident? How can you claim compensation?

I have no car insurance and someone hit me, what are my rights?

It's important to consider who's really at fault in the situation. It's possible that in an accident, both parties are to blame. If this is the case, check "What if I'm partly to blame?" below.

If you're involved in an accident and the other party is clearly at fault, then you have certain legal rights. According to Shine Lawyers, even without car insurance, you're entitled to compensation from the other driver for damage caused to your vehicle or property. You're in a position to send them a letter of demand as well as estimates for repair and/or towing costs from a licensed repairer.

In this situation, the other party has a couple of options:

  • Through insurance. If they're insured, they can choose to make a claim from their insurer to cover what they owe you.
  • Not through insurance. On the other hand, they may choose not to, instead deciding to pay you with their own money.

Does my CTP cover me?

Compulsory third party (CTP) insurance, or green slip in NSW, only covers you for costs for injuries or deaths that are the result of an accident. When it comes to repair bills, CTP doesn't help.

What details do I need to collect from the other driver?

After you've had an accident, it's important to keep your head and collect some vital information. You should collect:

  • The name of the other driver
  • The other driver's address
  • The name of their insurer
  • Their registration number
  • The make and model of the car
  • Contact details of any witnesses to the accident

It's also a good idea to take pictures of the damage caused to the vehicles involved, so you can establish what is or isn't a reasonable repair cost later.

What are your options if the other driver refuses to pay?

The awful reality of not having insurance is that in the event of an accident you have to rely on the other party to produce the money you're owed. If they refuse for whatever reason, you can issue a letter of demand for compensation. If they ignore this, you'll have to get a lawyer and take them to court.

Alternatively, if the damage or repair bill is small enough, there could be another legal recourse. If the amount you're seeking is less than $15,000 and the other driver is insured, you can lodge a complaint with the AFCA to seek your compensation.

What if I'm partly to blame?

This is a tricky situation to be in. The driver at fault in an accident is whoever didn't take reasonable care to prevent it. Sometimes, this can be both drivers. In this case, blame is split 50/50: you're only responsible for 50% of the damage and entitled to 50% of the cost of repairs on your own vehicle.

But according to the Financial Rights Legal Centre, this may still leave you out of pocket. If your car is worth significantly less than the other vehicle, you may end up owing thousands for repairs to the other vehicle while still needing to pay for repairs to your own.

Why should I have comprehensive insurance instead of third party?

As you can see, getting into an accident without any insurance can turn into a financial and legal nightmare. If you want to avoid all the messy and difficult legal disputes that are bound to ensue, consider investing in comprehensive car insurance to protect yourself against the widest possible range of problems. With only basic third party insurance, you simply aren't protected against most eventualities and will be out of pocket in most circumstances.

Bottom line

No insurance means no safety net in an accident. Yes, it's possible to get compensation if you're not at-fault without insurance, but it's a long and difficult road that could still cost you a great deal. Comprehensive car insurance may cost more than nothing, but it could help you save in the long run.

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