Ok first off I will tell you the situation:

July 4th 2006, I was letting a family member using a car in my name. I was the policy holder on the auto insurance. They were listed as a driver. Also this is in the state of Utah.

On that day the family member I let use the car was hit head on by a drunk driver, the drunk driver swerved into the oncoming traffic. The drunk driver was taken to jail, and issued a citation. The drunk driver was not the owner of the car they were driving, however the car did have insurance on it.

My family member had severe injuries, and met with a lawyer. The Lawyer sued their insurance company. The other vehicle had $25,000 coverage. The lawyer was able to get that payment from the insurance company. However they made my family member sign a document saying if they accepted that money, they could not sue them for any thing else. By taking the money and signing the paper it released them from any further liability. I did not sign any documents, it was only signed by my family member. So then my family member decides that wasn't enough money, and sues my insurance company. After a year and a half my insurance settles. Decides to payout $80K. The family member received their money from my insurance company.


Today I get in the mail, a letter from a collection company. They are trying to collect $103,500 from me. When I call the collection company, they say they are collecting on behalf of my insurance company. They say this letter she signed releasing the at fault party's insurance company makes me reliable.

Keep in mind, I have not signed any documents, only the family member.

Now my insurance coverage was only $25K PIP. So they are trying to collect the money plus collection fees for having to pay money to my family member.

My question is, can I legally be held responsible, since my car was not at fault?
I can understand being liable if it was my car that was at fault.

I am making an appointment with an attorney tomorrow, but I want to know where I stand. How can someone collect from someone not at fault? I don't know the laws.

While I doubt it, you will need an attoreny. And to be honest your family member really messed you over on this, signed a settlement with the party at fault and then went and sued you for more.

Yeah I realized I got screwed over by this. The lawyer told my family member they were suing my insurance, not me, so I wouldn't be affected. I didn't know until it was all said and done. Thank you for the advice, hopefully I will get good news from an attorney.

Let me know, I have one angle I was concerned about, but will want to learn myself.

It may involve you filing a suit against both insurance companies. I too am interested in hearing what advice you get from the attorney. Did you have liability coverage as well as medical coverage included in your policy?

I will let you know tomorrow after I talk to my attorney.

Yes I had liability and medical.

However I only had $25k personal injury protection. I need to also get a copy of my insurance binder too to see all of the coverages.

Well I talked to the attorney for my family member. They said that my insurance cannot try to collect this money from me. When he accepted this settlement, the insurance company signed a paper stating they could not come back against me the insured, or the injured party. And also since we were not the party at fault they can't come back against us that way either. Anyhow he has sent a letter to to collection agency and insurance company. And if they try to further purse us, he will file a lawsuit against the insurance company.

Well I talked to the attorney for my family member. They said that my insurance cannot try to collect this money from me. When he accepted this settlement, the insurance company signed a paper stating they could not come back against me the insured, or the injured party. And also since we were not the party at fault they can't come back against us that way either. Anyhow he has sent a letter to to collection agency and insurance company. And if they try to further purse us, he will file a lawsuit against the insurance company.


Just a technicality but you don't sue an insurance company - you make a claim. Any lawsuit if it doesn't settle is against the policyholder.

On what grounds did the driver of your car claim against your insurance company?

Unless I am reading this wrong the driver of your car claimed against the other driver's insurance and accepted a settlement. Then the driver of your car signed an agreement with the other driver's insurance company that the driver wouldn't go against you (and, as I said, I can't imagine what the grounds are).

Anyway - the other party's insurance company should have no interest in any other lawsuits and they can't force a binding agreement on a third party - your insurance company.

For example, I'm car #3 and I'm hit by #1 and #2. Neither #1 or #2 can settle with me in exchange for me agreeing not to sue the other company because they have no interest in other company. That would be the same, for example, for me settling with you in exchange for a promise that you wouldn't sue, say, FrChuck - I have no say in what you do after you take my money and walk away.


Either I am adding this up wrong OR something is missing.