Denver, CO personal injury attorney Kyle Bachus explains how car accident insurance works. He states that after a car crash, the way insurance works is fairly straightforward in principle, though often misunderstood. Anyone who owns and registers a car is required to carry insurance, but there are different types and coverage amounts. Many people simply pay their premiums without ever considering they might need to use it.

In the event of a crash, the at-fault driver’s insurance company steps in to cover what that driver legally owes. What a driver “owes” is defined by state law: when someone drives unreasonably—failing to act with the care expected on the road—and causes a crash resulting in injury or property damage, that driver is legally responsible to compensate the injured party. This unreasonable conduct is known legally as negligence.

The insurance company effectively “steps into the shoes” of the negligent driver and is obligated to pay for the damages that result from their client’s negligence. In some cases, responsibility may also extend to the vehicle’s owner or even the employer if the vehicle was being used in the course of work. The key principle is that the law holds drivers accountable for acting unreasonably on the road, and insurance exists to ensure those damages are covered.