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Someone else’s negligence hurt you. You hear the at-fault driver has “liability coverage” or the property owner carries “liability insurance,” but what does that actually mean for your injury claim? How much will the policy pay? What if the at-fault party’s insurance isn’t enough? What happens when the insurer denies coverage?
Liability in insurance means the at-fault party’s legal responsibility to compensate you for injuries or property damage they caused, and their insurance policy’s obligation to pay those damages up to policy limits.
Walner Law represents people injured in car accidents, slip-and-fall incidents, and other claims across Chicago and Cook County where at-fault parties’ liability insurance should cover medical bills, lost wages, pain and suffering, and property damage, but insurers deny coverage, dispute fault, or refuse fair settlements.
Key Takeaways for Liability Insurance When You’re Injured
- Liability insurance covers the at-fault party’s legal obligation to compensate you for bodily injury and property damage they caused through negligence
- Illinois requires minimum auto liability limits of $25,000 per person for bodily injury, $50,000 per accident, and $20,000 for property damage, though many drivers carry higher limits
- Liability coverage pays your medical bills, lost wages, pain and suffering, and property damage, not the at-fault party’s own injuries or damages
- Illinois comparative negligence under 735 ILCS 5/2-1116 reduces your recovery by your percentage of fault; if you’re 51% or more at fault, you recover nothing
- When the at-fault party’s liability coverage is insufficient, you may pursue your own uninsured/underinsured motorist (UM/UIM) coverage or umbrella policies for additional compensation
What Does “Liability” Actually Cover After a Chicago Car Accident?
Liability insurance pays for harm the policyholder causes to other people. When another driver’s negligence causes your car accident, their liability insurance compensates you for injuries and property damage. When a property owner’s negligence causes your slip-and-fall, their liability insurance covers your losses.
Bodily Injury Liability
Bodily injury liability covers physical injuries you suffer in an accident caused by the at-fault party. This includes:
Medical expenses:
- Emergency-room treatment and ambulance transport
- Hospitalization, surgery, and follow-up visits with specialists
- Physical therapy, prescription medications, and medical equipment
- Future treatment costs if your doctor recommends ongoing care
Lost income:
- Wages missed during recovery (hourly or salaried)
- Lost future income if permanent injuries reduce your earning capacity
- Self-employment income proven through tax returns and client invoices
- Bonuses and commissions you would have earned
Non-economic damages:
- Pain and suffering, emotional distress, and mental anguish
- Loss of enjoyment of life and inability to participate in activities
- Permanent disability, disfigurement, and scarring
- Loss of companionship (claimed by spouses in wrongful-death cases)
In car accidents, the at-fault driver’s bodily injury liability coverage pays these damages up to policy limits. Illinois requires minimum coverage of $25,000 per person and $50,000 per accident under 625 ILCS 5/7-203.
Property Damage Liability
Property damage liability covers damage to your vehicle and other property caused by the at-fault party. This includes:
- Vehicle repair costs or fair-market value if your car is totaled
- Rental-car expenses while your vehicle is being repaired
- Towing and storage costs from the accident scene
- Diminished value (your vehicle’s reduced resale value after repairs)
- Damage to personal belongings in your vehicle (phones, laptops, clothing)
For vehicles, Illinois requires minimum property damage coverage of $20,000, but this often doesn’t cover total losses in serious accidents involving newer vehicles or multiple damaged cars.
How Do Illinois’ Fault and Comparative Negligence Rules Affect Liability Payouts?
Illinois uses a fault-based insurance system, meaning the at-fault party’s insurance pays for damages they cause. Determining fault matters because it dictates whose liability insurance responds and how much you recover.
Fault Determinations and Liability Payouts
Fault is determined through investigation of police reports, witness statements, traffic violations, vehicle damage, traffic-cam footage, and physical evidence. Clear violations, like running red lights, rear-ending stopped vehicles, DUI crashes, can establish fault quickly. Disputed cases require more investigation and sometimes expert accident reconstruction.
In premises liability cases like slip-and-falls at businesses or injuries on private property, fault depends on proving the property owner knew or should have known about the dangerous condition and failed to fix it or warn visitors. Maintenance records, incident reports, surveillance footage, and building code violations help establish the property owner’s negligence and trigger their liability insurance coverage.
Comparative Negligence and Liability Payouts
Illinois follows modified comparative negligence under 735 ILCS 5/2-1116. Your damages are reduced by your percentage of fault if you’re 1% to 50% at fault. If you’re 51% or more at fault, you recover nothing.
Insurance adjusters can use comparative negligence to reduce payouts. They may try to shift the blame to cut their liability payment. Walner Law counters these arguments with police reports, witness statements, traffic-cam footage, and expert testimony proving the other party’s negligence caused your injuries.
Can I Claim Against Multiple Policies?
Yes, in certain situations, you can pursue multiple insurance policies to maximize your recovery.
Stacking Coverage
Some states allow “stacking” UM/UIM coverage from multiple vehicles on your policy. Illinois doesn’t allow true stacking, but you can pursue UM/UIM coverage from household vehicles separately if policies are written that way.
Multiple At-Fault Parties
If multiple parties share fault for your accident—say a multi-vehicle pileup on the Dan Ryan—you can pursue each at-fault driver’s liability insurance up to their respective policy limits. Your total recovery can exceed any single policy limit, but can’t exceed your actual damages.
Additional Insured Endorsements
In premises liability and construction accident cases, additional insured endorsements may extend coverage from subcontractors to general contractors or from tenants to landlords, providing multiple sources of liability coverage for your claim.
Walner Law investigates potential insurance sources when the primary responsible party’s liability coverage is insufficient.
What If the Insurer Says There’s No Coverage?
Liability insurers sometimes deny coverage even when their policyholder caused your injuries. Common reasons include:
Policy Exclusions
The insurer claims your injury falls under a policy exclusion—intentional acts, business use of personal vehicles, racing, or other excluded activities. Some exclusions are legitimate; others are misapplied to deny valid claims.
Late Notice or Breach of Policy Terms
The insurer argues their policyholder didn’t report the accident promptly or breached policy terms, voiding coverage. Illinois law protects policyholders from coverage denials based solely on late notice unless the insurer proves actual prejudice to their ability to investigate or defend the claim.
Reservation of Rights
The insurer issues a “reservation of rights” letter stating they’ll investigate and potentially defend the claim while reserving the right to later deny coverage based on policy exclusions or other grounds. This protects the insurer’s interests but doesn’t necessarily mean coverage will be denied.
Coverage Outside Policy Period
The insurer claims the accident occurred outside the policy period or, for claims-made policies, that the claim wasn’t reported during the policy term.
Walner Law challenges wrongful coverage denials by reviewing policy language, investigating facts, and demonstrating coverage applies under Illinois insurance law. When insurers act in bad faith, we pursue bad-faith claims that can result in damages beyond policy limits.
When Can You Pursue an Employer’s or Vehicle Owner’s Liability Insurance?
When you’re injured by someone driving for work purposes, the driver’s employer may be vicariously liable under the doctrine of respondeat superior, meaning the employer is legally responsible for the employee’s negligent acts committed within the scope of employment.
Employer Vicarious Liability
If a delivery driver, rideshare driver, or other employee causes your accident while performing job duties, you can pursue both the driver’s personal liability insurance and the employer’s commercial liability insurance. Employers typically carry higher liability limits than individual drivers, increasing available compensation.
Example of vicarious liability:
A FedEx driver runs a red light while making deliveries and strikes your vehicle. The driver was acting within the scope of employment. You can pursue the driver’s personal auto liability and FedEx’s commercial liability insurance, which likely carries substantially higher limits.
Permissive Use and Non-Owner Liability
When someone borrows a vehicle with the owner’s permission, liability coverage typically follows the vehicle. The owner’s liability insurance provides primary coverage, and the driver’s own liability coverage (if any) may provide secondary coverage.
Example of permissive use:
If a friend borrows your car with permission and causes an accident, your liability insurance provides primary coverage for the injured party’s damages. Your friend’s liability insurance might provide excess coverage if damages exceed your policy limits.
Is MedPay the Same as Liability Coverage?
No. Medical payments coverage (MedPay) and liability coverage serve different purposes and benefit different parties.
MedPay (Medical Payments Coverage):
- Covers your own medical expenses after an accident, regardless of fault
- Pays quickly without waiting for fault determination or settlement
- Typical limits: $1,000 to $10,000
- Available from your own auto insurance policy
- Doesn’t cover lost wages or pain and suffering
Liability Coverage:
- Covers the other party’s damages when you’re at fault
- Pays medical bills, lost wages, pain and suffering, and property damage you caused
- Requires fault determination before payment
- Covers damages up to policy limits
- Doesn’t cover your own injuries or damages
If you’re injured in an accident you didn’t cause, the at-fault party’s liability insurance should compensate you. Your own MedPay provides quick payment for immediate medical expenses while you pursue the liability claim.
MedPay amounts are typically reimbursed from your liability settlement if you recover for the same medical expenses.
What’s the Difference Between Liability and Full Coverage?
“Full coverage” isn’t an official insurance term, but typically refers to a combination of liability, collision, and comprehensive coverage.
Liability Coverage
Covers damages you cause to others—their medical bills, lost wages, pain and suffering, and property damage. Doesn’t cover your own injuries or vehicle damage.
Collision Coverage
Covers damage to your own vehicle from collisions with other vehicles or objects, regardless of fault. You pay a deductible, and the policy covers the remaining repair or replacement costs.
Comprehensive Coverage
Covers damage to your vehicle from non-collision events: theft, vandalism, fire, hail, falling objects, and animal strikes. You pay a deductible, and the policy covers the remaining costs.
When you’re injured by another driver, their liability coverage compensates you. Your collision coverage repairs your vehicle while you pursue the at-fault driver’s property damage liability for reimbursement.
FAQ: Liability Insurance in Chicago Personal Injury Cases
Liability insurance pays for your damages when the other party is at fault, not the at-fault party’s own injuries or damages. If another driver causes your accident, their liability insurance pays your medical bills, lost wages, and pain and suffering.
No. UM/UIM coverage is part of your own auto insurance policy and pays your damages when the at-fault driver has no insurance (UM) or insufficient insurance (UIM) to fully compensate your injuries. Liability insurance refers to the at-fault party’s coverage that pays damages they caused to you.
Yes. If an employee causes your injury while performing job duties, you can pursue the employer’s commercial liability insurance in addition to the employee’s personal insurance. Commercial policies typically carry substantially higher limits than personal policies, providing greater compensation for serious injuries.
Yes. Homeowners and renters liability insurance covers injuries you suffer on someone else’s property when the property owner’s negligence caused your injury, such as slip-and-falls on icy walkways, dog bites, or injuries from defective conditions.
You can pursue multiple policies when multiple parties share fault or when coverage layers exist (primary, excess, and umbrella policies), but your total recovery cannot exceed your actual damages. Walner Law investigates available insurance sources to secure fair compensation.
Legal Help When Liability Coverage Is Disputed
Liability insurance is there to compensate you when others cause your injuries, but insurers sometimes deny coverage, dispute fault, or make low offers, hoping you’ll settle for less than your claim is worth.
Walner Law represents people injured in Chicago car accidents, slip and fall incidents, construction site injuries, and other claims where at-fault parties’ liability insurance should respond. If you’re injured and the at-fault party’s insurer denies coverage, disputes fault, or refuses fair compensation, call (312) 410-8496 for a free consultation.
