Glossary
Claim termsin plain English.
Last updated Written by Accident Claim Check Editorial TeamAttorney review: pending
A
- At-fault state
- A state where the driver who caused a crash, through their liability insurance, is generally responsible for the other people's losses. Also called a tort state. Learn more
B
- Bodily injury liability (BI)
- Insurance that pays for injuries you cause to other people in a crash, up to your policy limits.
C
- Comparative fault
- A rule that reduces your compensation by your share of blame for a crash. Under pure comparative fault you can recover even if mostly at fault; under modified comparative fault you are barred above a set percentage (50% or 51%). Learn more
- Contingency fee
- A fee arrangement where an attorney is paid a percentage of any recovery instead of hourly. If there is no recovery, there is usually no attorney fee, although case costs may still apply depending on the agreement. Learn more
- Contributory negligence
- A strict rule used in a few places (such as Alabama, Maryland, North Carolina, Virginia and DC) that can bar recovery if the injured person was even slightly at fault.
D
- Damages
- The money a person may recover for losses caused by someone else, such as medical bills, lost wages, pain and suffering and property damage.
- Demand letter
- A letter, usually from an attorney, that describes the injuries and losses and asks the insurer to pay a specific amount to settle the claim.
- Deposition
- Sworn testimony given outside court during a lawsuit, usually in a lawyer's office, and recorded by a court reporter.
E
- Economic damages
- Losses with a clear dollar value, like medical bills, lost wages and repair costs.
F
- First-party claim
- A claim against your own insurance, such as PIP, MedPay, collision or uninsured motorist coverage.
L
- Liability
- Legal responsibility for causing harm. In a crash claim, the liable party (usually through insurance) may have to pay for the injured person's losses.
M
- Maximum medical improvement (MMI)
- The point where a doctor believes your condition has stabilized and is unlikely to improve much further. Many claims are valued after MMI.
- Medical payments coverage (MedPay)
- Optional coverage in many states that pays medical bills after a crash, regardless of fault, up to a limit.
N
- Negligence
- Failing to act with reasonable care — for example, texting while driving. Most car accident claims are based on negligence.
- No-fault state
- A state where your own PIP coverage pays first for medical bills and some lost income after a crash, no matter who caused it. Pain-and-suffering claims against the other driver are usually limited to injuries above a threshold. Learn more
- Non-economic damages
- Losses without a fixed price, like pain and suffering, emotional distress and loss of enjoyment of life.
P
- Pain and suffering
- Compensation for physical pain and emotional distress caused by an injury.
- Personal injury protection (PIP)
- First-party insurance that pays your own medical bills and some lost income after a crash, regardless of fault. Required in no-fault states and some at-fault states.
- Police report (crash report)
- An official record of a crash prepared by the responding officer. It usually lists the drivers, insurers, witnesses and the officer's observations.
- Policy limits
- The most an insurance policy will pay for a covered claim.
- Property damage liability (PD)
- Insurance that pays for damage you cause to someone else's car or property.
R
- Recorded statement
- An insurer's recorded interview about the crash. You are generally not required to give one to the other driver's insurer. Learn more
- Release
- A document you sign when you settle a claim. It usually ends your right to ask for more money later.
S
- Serious injury threshold
- In no-fault states, the level of injury (or medical expenses) required before you can claim pain and suffering from the at-fault driver.
- Settlement
- An agreement to resolve a claim for an agreed amount, usually without going to trial.
- Stacking
- Combining uninsured/underinsured motorist coverage from more than one vehicle or policy. Some states allow it; others do not.
- Statute of limitations
- The legal deadline to file a lawsuit. For injury claims it is often two or three years, but it varies by state and can be as short as one year. Learn more
- Subrogation
- When an insurer that paid your bills (such as your health insurer) seeks repayment from your settlement or from the at-fault party.
T
- Third-party claim
- A claim against someone else's insurance — usually the at-fault driver's.
U
- Uninsured / underinsured motorist coverage (UM/UIM)
- Coverage on your own policy that pays when the at-fault driver has no insurance (UM) or not enough insurance (UIM). Learn more
W
- Wrongful death claim
- A claim brought by certain family members or the estate when a person dies because of someone else's negligence. Learn more
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