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Glossary > Insurance > Auto Insurance > Liability Insurance
Legal Disclaimers

Comparative Negligence

Comparative negligence is a legal concept used in insurance, specifically auto insurance and liability insurance, which determines the degree of fault each party bears in an accident. In cases of comparative negligence, the damages awarded to a party are reduced based on their percentage of fault in the accident.

Example #1

For example, if a driver runs a red light and hits another car, but the other driver was speeding slightly, a court may find the first driver 80% at fault and the second driver 20% at fault. If the total damages are $10,000, the first driver would be responsible for $8,000, and the second driver $2,000.

Example #2

In another scenario, if a pedestrian jaywalks and gets hit by a car that was speeding, a court may attribute 30% fault to the pedestrian and 70% to the driver. If the damages total $20,000, the pedestrian would be entitled to $14,000 and the driver to $6,000.

Misuse

Misuse of comparative negligence can occur when an insurance company unfairly shifts more fault onto the claimant in order to reduce the compensation they need to pay. By doing this, insurance companies can save money at the expense of the policyholder, who may not have been primarily at fault. It is crucial to protect against misuse of comparative negligence to ensure fair compensation for those involved in accidents.

Benefits

The benefit of comparative negligence is that it allows for a fair allocation of fault in accidents where both parties may have contributed to the incident. This system prevents one party from bearing the entire burden of damages when the fault is shared. For example, a driver who is slightly speeding but gets hit by a driver running a red light would not be unfairly penalized for the other driver's more significant violation.

Conclusion

Understanding comparative negligence is crucial for consumers and policyholders in insurance matters, as it determines the financial outcomes of accidents where fault is shared. By ensuring a fair assessment of fault, consumers are protected from unjust settlements and receive compensation in proportion to their level of responsibility in an accident.

Last Modified: 4/29/2024
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