Claims made against you
What if I don't have insurance or don't want to use my insurance?
You should get legal advice about what to do if you do not have insurance or have decided not to use your insurance to deal with the claim.
Do I have to pay for the property damage?
Generally, the person who is at fault in the crash is liable to pay for all the damage.
It is important to get legal advice about who was at fault. In some cases, the courts decide that both drivers are partly responsible for the crash.
How do I deal with a claim against me for property damage?
Get legal advice as soon as you receive a letter demanding payment from the other driver or their insurer or a debt collector.
If the crash was your fault, negotiate with the other driver or their insurer as soon as possible.
Ask for copies of all quotes and if they are reasonable, arrange to pay the debt. You can offer to pay by instalments but the other party or their insurer does not have to accept that.
If you cannot pay the full amount, work out what you can realistically pay. Give the reasons why you cannot afford to pay the full amount straight away.
What if I think the amount claimed is unfair?
If you think the amount claimed is too much:
- Gather as much proof to support this as you can.
- Ask the insurer for copies of itemised bills, photos, assessor’s reports.
- Look carefully at any documents you receive from the insurer.
- If you still think the amount claimed is unfair you will need to say why and provide proof. For example, you might provide a written opinion from a mechanic and/or repairer on what would be fair repair costs based on the information you provided (such as photos).
- You can:
- send a letter or email to the insurer or other driver explaining your position and attaching any proof, and
- request that the amount for repairs be reviewed through the insurer’s internal dispute resolution process.
If you can’t reach an agreement with the other driver or their insurer without going to court, legal costs and court costs may generally be added to the amount claimed.
What if I do nothing?
Do not ignore the problem. The other party or their insurer may start a court case against you, which will increase your costs.
What if I can't afford to pay anything?
If you cannot afford to pay anything at all, and you have no assets to be seized or sold, there are several options to consider:
- Write to the other party (if they are not insured), explaining your financial situation. Point out that if they take you to court, they are unlikely to obtain any money.
- If the other party is insured, write to their insurer. You might also be able to use the General Insurance Code of Practice to try to have the debt set aside. The Code deals with internal dispute resolution and applying for external review through the Australian Financial Complaints Authority.
- In some circumstances consider voluntary bankruptcy. There are many negative consequences of this. It is essential that you seek financial and legal advice if you are thinking about bankruptcy.
Reviewed: 14 October 2022