Yes, insurance companies pursue uninsured drivers for damages, but how depends on who was at fault and what type of coverage the other driver had

When an uninsured driver causes a crash, the injured party's insurance company will often try to recover money from that driver directly. This process is called subrogation. The insurance company pays the claim first, then pursues the uninsured driver in small claims court or civil court to get that money back. Whether they actually collect depends on whether the uninsured driver has assets, income, or a bank account the court can reach.

If you were the uninsured driver, you could face a lawsuit from the other person's insurance company, a judgment against you, wage garnishment, or a lien on your property. You could also face separate legal action from the injured person themselves. The financial consequences of driving without insurance often extend far beyond the accident itself.

Key Takeaways

  • Insurance companies use subrogation to sue uninsured drivers for the cost of claims they paid out, and they pursue these cases regularly.
  • An uninsured driver at fault can face a judgment, wage garnishment, bank account levies, or property liens from either the insurance company or the injured person.
  • If you hit an insured driver, their company will likely pursue you; if an insured driver hit you, your own uninsured motorist coverage (if you have it) covers your damages instead of relying on their insurance.
  • State law determines how long an insurance company can pursue an uninsured driver, ranging from two to six years depending on where the accident happened.
  • Settling with the injured party directly before a lawsuit is filed often costs less than fighting a judgment in court.

How insurance companies track down uninsured drivers

Insurance companies have access to state motor vehicle records and police reports filed after accidents. When a crash report shows one driver was uninsured, the injured driver's insurance company receives that information. They then send investigators to locate the uninsured driver, verify their identity, and confirm they had no coverage at the time of the accident.

If the uninsured driver has a job, the insurance company can find that through public records, social media, or by hiring a skip tracer. They can also discover bank accounts, property ownership, and vehicle registrations. This information helps them decide whether pursuing a lawsuit will actually result in collecting money, or whether the uninsured driver has no assets worth pursuing.

What happens in a subrogation lawsuit

Subrogation cases usually start in small claims court if the damages are under the court's limit (typically $5,000 to $10,000, depending on your state). The insurance company files the lawsuit in their own name, not the injured person's name. The uninsured driver receives a summons and can choose to respond, ignore it, or settle before trial.

If the insurance company wins the case, the court issues a judgment against the uninsured driver. That judgment is a legal debt that can be enforced through wage garnishment (taking money from paychecks), bank account levies (freezing and seizing funds), or property liens (claiming a stake in a house or car until the debt is paid). The judgment can remain on record for years, making it harder to get loans or rent an apartment.

When the injured person sues the uninsured driver directly

The injured person can also file their own lawsuit against the uninsured driver, separate from any action the insurance company takes. This is common when medical bills or vehicle damage exceed what the injured person's own insurance will cover, or when they don't have uninsured motorist coverage.

In these cases, the injured person becomes the plaintiff and can pursue the same collection methods: wage garnishment, bank levies, and liens. An uninsured driver could face multiple lawsuits—one from the insurance company and one from the injured person—each resulting in separate judgments and collection efforts. The injured person may also hire a collection agency to pursue the debt.

How uninsured motorist coverage protects you

If you have uninsured motorist coverage on your own policy and an uninsured driver hits you, your insurance company pays for your medical bills and vehicle damage up to your coverage limit. You don't have to rely on the other driver's insurance or pursue them yourself. Your insurance company then handles the subrogation process.

Without uninsured motorist coverage, you would need to sue the uninsured driver directly to recover damages, which is often difficult if that driver has no money or assets. This is why uninsured motorist coverage is required in some states and recommended in all states, even though it costs relatively little to add to your policy.

Time limits for pursuing an uninsured driver

Insurance companies and injured parties cannot pursue an uninsured driver forever. Each state sets a statute of limitations—a important date for filing a lawsuit. For car accidents, this is typically two to six years from the date of the accident, depending on your state and whether the case is in small claims or civil court.

Once the statute of limitations expires, the uninsured driver cannot be sued for that accident. However, if a judgment was already issued before the important date, the insurance company or injured person can still try to collect on it for many years afterward. Check your state's specific time limits, as they vary significantly.

What you should do if you caused an accident uninsured

If you were driving without insurance and caused a crash, contact the injured person or their insurance company as soon as possible. Many people settle claims before a lawsuit is filed, which typically costs less than fighting a judgment in court and dealing with collection efforts afterward.

You may also want to consult a lawyer, especially if the damages are substantial. Some lawyers offer free initial consultations and can advise you on settlement options or help you negotiate a payment plan. Ignoring the situation will not make it go away—it will only make collection efforts more aggressive and expensive.

Frequently Asked Questions

Can an insurance company garnish my wages if I'm uninsured and at fault?

Yes, but only after winning a judgment in court. The insurance company must file a lawsuit, win the case, and then request a wage garnishment order from the court. Once approved, your employer is required to withhold a portion of your paycheck and send it to the insurance company until the judgment is paid.

What if the uninsured driver has no money or job?

The insurance company may still file a lawsuit and obtain a judgment, which can remain on record for years. If the uninsured driver later gets a job or inherits money, the insurance company can attempt collection at that time. Some companies decide the cost of pursuing a judgment is not worth it and write off the loss.

Does my insurance go up if an uninsured driver hits me?

Not typically, because you were not at fault. However, filing a claim for any accident can affect your rates depending on your insurer's policy. Having uninsured motorist coverage means your own insurance handles the claim, so you avoid having to pursue the other driver yourself.

How long can a judgment against me stay on record?

Judgments typically remain enforceable for 10 to 20 years depending on your state, and some states allow them to be renewed indefinitely. Even after the statute of limitations for filing a new lawsuit expires, an existing judgment can still be collected on through wage garnishment or bank levies.

Can I settle with the injured person to avoid a lawsuit?

Yes, and settling before a lawsuit is filed is often cheaper than paying court costs and collection fees. You can negotiate a payment plan directly with the injured person or their insurance company. Get any settlement agreement in writing to protect yourself from future claims about the same accident.