What Can Be Taken from You If You Lose in an At-fault Car Accident Lawsuit?

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In most cases what happens if you lose a car accident lawsuit, you will not receive accident settlement compensation and will be unable to file a claim or lawsuit for the same case in the future. When losing certain types of auto accident claims, you could even be required to pay the legal expenses for the defense. However, this case scenario is rare; and you will most likely not have to pay your attorney or the defense lawyer out of pocket.

If in local court you were found to be at fault for a car accident and a judge or jury rules that you were at fault for causing the crash, you will be held liable for the damages. Even so, your automobile liability insurance covers these damages for this exact case scenario. Liability car insurance is used to pay for damages or injuries due to the result of a collision for which you are legally determined to be at fault.

For the most part, we have discussed car accidents from the perspective of the plaintiff. Obviously, there is another side to this coin. If you are the defendant in the case, your options are considerably different than the plaintiff, especially if you do not have insurance in an at-fault car accident. Just as there is anxiety on the part of the plaintiff in a case, that is probably tenfold for the defendant.

For the most part, if you have insurance, you should be okay financially. Your coverage will more than likely pay all damages unless you are found to be grossly negligent. The more insurance you have as a defendant, the less likely you are to have to pay anything out of pocket, although your premium will likely go up. If you do not have insurance (or have minimal insurance), things change considerably.

Without insurance, it will be your responsibility to cover all compensation awarded to the plaintiff. This will include medical costs, property damages, pain and suffering, lost wages, etc. Even with insurance, if a settlement is large enough, some of these costs could overlap the coverage, meaning that you would have to pay them out of pocket.

For instance, in the state of Nevada, drivers are only required to have coverage of $25,000. If you were in a significant accident, you would be personally liable for all damages over that amount.

What Assets Can a Car Accident Victim Take?

If you lose your case, the plaintiff then becomes a judgment creditor. If you have the cash on hand, you can pay the settlement immediately. If you do not have enough cash, you may be able to work out a payment plan with the plaintiff until the debt is paid off. If neither of those options is viable, the plaintiff could pursue his or her right to execute on your property, meaning the plaintiff is coming after your personal assets to satisfy the judgment.

Your Home

For the most part, your home will be protected unless it exceeds a specific value as mandated by state law. For instance, your home may be exempt up to a value of $500,000. If you have a home that is valued at more than that, you may be forced to sell to satisfy the judgment over and above that protected value. Your current mortgage would also come into play in such a case. For instance, if you have a home valued at $750,000 but still have outstanding debt on the home of $600,000, the value at that point should be based on equity, meaning $150,000, so your home would be fully exempt in such a case.

Your Car

Your car, unfortunately, is fair game, but again, the equity you have in the car comes into play. As with the above example, most states will have a limit on the value of the car as well as a qualifying value. For instance, state laws may dictate that any car is exempt up to a value of $10,000. So, unless you have more than $10,000 in equity in the vehicle or if the vehicle is valued at under $10,000, the car will be safe.

Retirement Accounts

Most states have a cap on the amount of money that can be taken from a retirement account. For instance, the first $1 million may be protected for lawsuits, but anything over that could be subject to collections to settle the debt. Most inherited retirement accounts will also be ineligible for collections.

Cash on Hand

This, for the most part, is fair game. If you have the cash to cover the payment, or at least part of it, you would be expected to satisfy the judgment.

Life Insurance

For the most part, you cannot be forced to cash out any life insurance policies to satisfy such a debt.


They are fair game, to a point. Most states will have a qualifying level of earnings on a weekly or monthly basis that can be attached to satisfy a settlement claim. If you are collecting Social Security, all those earnings are exempt from a judgment. Additionally, any judgments from family court are typically exempt, meaning alimony and child support.

Home Furnishings

Most states have an exemption level, but everything over and above that can be used to help satisfy the judgement. For instance, your state may have a $15,000 exemption, which means goods up to $15,000 are protected, but anything over and above that will be used to pay your debt.

Talk to an Attorney

If you were recently in an accident, as you can see, you have plenty to lose if you are found at fault. Even as the defendant, we offer a free consultation to evaluate your case. If you are ready to speak to one of our attorneys, please fill out the free auto accident evaluation form.

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