I need to win this bet! $5000.00 on the line! Attn: Car insurance reps!!!?

Question

Okay, my mother bet me a 5 thousand dollar car that she is right about this. Here we go. I am 27 and live back at home with parents. However, I rent a room that i pay for every month, and they write me a rent receipt, etc. I recieve county assistance every month, and they have me documented as a seperate family from my parents, meals prepared seperately, the whole nine yards. So, if they are just my landlords technically, and if i drive a car that is registered to me, my name on title, my OWN insurance policy, and I get into a accident in MY car, can they other party sue my parents for damages? Remember I am 28 years old, living in a seperate household from them. I feel that they cannot sue them cuz they couldnt sue my landlord if i lived in an apartment complex, so how coyuld they sue my landlords?

Answer 1

The only way you're in a separate household for insurance purposes is if you live in a multi-family house and you live a separate living unit from your parents.  But your question isn't about insurance, it's about litigation.  Ask an attorney if your parents can be dragged into such a lawsuit.  Since you're over 18 I don't think they should be held responsible for your actions just because you share an address.  But I'm not an attorney and I'm not familiar with the laws of your state.

Answer 2

You're over 18.  That's not the issue.  Related or not is not the issue.  The issue is---  If the car is OWNED BY YOU, then NO, your parent's can't be sued.  No way, no how.  If they own the car, then YES they can get sued.

Answer 3

Yes, they can.   Anyone can sue anyone else here in the US for anything.

I had a real, live client, he was a doctor, she was a housewife.  They had a 26 year old son that lived with them - paying rent, in the garage apartment.  He had a car in his name, with his own insurance.  He had a drinking problem.

He drove drunk one night, hit a young father of three kids, left him paralized for life.  His policy paid out the limit.  The guy then sued his parents, as they knew he had a drinking problem, and didn't try to keep him from driving.  Jury sided with the young paralized dad of three - and the dad's umbrella policy ended up paying out $5,000,000 for a  judgement.

Anyone can sue anyone else.  Will it hold up in court?  Depends on the circumstances.  Meanwhile, the "anyone else" is stuck with the defense costs, which can be more than the judgement, in some cases.

Answer 4

They can sue your parents.

Does not mean they will win. It may not even survive a Declaratory Judgment action.

But defense costs get incurred.

(you can sue anyone for anything - does not mean you will win).

This is very general info - so your policy language or state law could change what I'm about to tell you.  And it's me trying to make a complicated subject simple.  (this is not legal advice).

1. Most auto policies define an insured as the named insured and spouse - and any resident relatives living in your household.

Since you are a blood relative living in your parents house - you will qualify as an insured.

However - that does not mean your parents will get sued.

Mostly it means that if you drive your parents car on a regular basis you have to be listed on their policy.



- Depending on your state law -- if you were involved in an accident and injured. The accident was caused by an uninsured motorist - you would file against your own policy (on your car) for uninsured motorist coverage. If your injuries were so bad that your policy limits were not enough - you may be able to qualify for coverage under your parents uninsured motorist coverage. (this is called stacking-- some states do it and others dont).

But-- your parents are talking about LIABILITY.

Liability is a completely different animal from uninsured or under insured motorist coverage.

With Liability coverage - IF  

1. the car is in your name only (your parents are not listed on the title or registration)

2. You have your own policy  - in your own name

And you are involved in a accident for which you are at fault

A law suit against your parents would not succeed. Your parents policy would not provide coverage for the loss.

Here's why:

In order for someone to sue your parents (and win) - your parents have to be negligent.

If they have no ownership in the car and they were not operating the car - there is no cause of action against them.

Liability coverage does not stack like uninsured motorist does.

That means -- if you are driving your car (that your parents name is not on) -that is insured under your own policy (where you are the named insured) and you cause a wreck and injure someone -- your parents policy would not come into play. Even if your coverage had lapsed. So the person could not successfully sue your parents or collect from their policy.

This is because the auto policy has language in it that says the liability coverage on the Dec page is the most it will pay regardless of the number of cars owned or policies.

The only way liability stacks is this: the driver is someone other than the owner.

This is because insurance follows the car first then the driver.

So - if your mom was driving your car. She causes an accident and injures some one.

1. your policy  liability would pay first. If those limits were not enough to handle the damage/injuries caused then..

2. your mothers liability would stack on top of your liability. This is because she is the driver.

The fact you are renting a room from your parents does not matter.

It all comes down to how the car is titled and registered  and how it's insured.

Keep in mind - that the info I gave you is very general - simple. The laws of your state, language of your policy and facts of loss could affect things.

You may want to speak to your agent too. Your agent is familiar with your state laws and your language.  Your agent would also be able to contact an adjuster with your company who could explain how it works where you are.

Not sure if you understood all this. This question is actually more complex than you realize.

I run into attorneys that get this all mixed up -- especially ones that don't deal with this all the time.

Now--- this does not mean that your parents could not be negligent in their own right.  It sounds like this is what happened in the example given by mbrcratz.

Here's another example:

Your parents purchase beer for a family gathering. You down a case and get bombed. You leave their home and hit someone on the way home causing injury. Your parents are negligent for providing the alcohol and allowing a drunk to drive. It's called Dram Shop Liability or Liquor Liability. It's the same concept that holds bars responsible when their drunk patrons leave and cause accidents.

In this case - you are negligent in your operation of the vehicle -- your parents would be negligent under Dram Shop Liability.

These are two separate causes of action. Your parents get sued (not for what you did) but for what they did or did not do.

That's why you take the keys before the party and anyone who  is drunk or "buzzed" - spends the night.