Reader’s Question:

A couple of weeks ago my friend’s car bumped into another car, she had a passenger at that time who claimed she had whiplash. For one week, she was not able to go to work and is now planning on suing my friend.
My friend, only has 3rd party car insurance and was wondering if her car insurance in Decatur Illinois would pay out to her passenger or would she have to pay out herself if claim goes through?

Robert

Decatur, IL

The passenger of your friend would be considered the third party and can sue your friend, the driver of the vehicle in which she was traveling if there’s negligence on the part of the driver resulting to damages, then there could be a valid claim.

An insurance policy is proof of a contract between two parties; the first party is the insurance company and the second party is the driver. Anyone else not involved in the agreement between the driver and the insurer is “third party”. The insurance policy agrees that the insurer will cover (i.e. pay the losses incurred by) the driver against all losses the driver may incur due to a claim by a third party.

The passenger cannot sue the insurance company as there is no contract between her and the insurer. What she can do only is to sue the driver. The driver will then ask the insurer to indemnify them against the claim. At this point, the insurer takes over the negotiations to come to an agreement with the passenger.

It will be best if the driver will answer any question by saying “I have advised my insurance company and they will deal with it”. In this way, he does not admit liability (which would be in breach of policy conditions and could result in the insurance company refusing to deal with the claim). I assume that your driver has already advised her car insurance company. If she receives any further communication from the passenger, she should forward it (unanswered) to her car insurance company in Decatur Illinois.