Am I personally liable for my child’s car accident?

Am I personally liable for my child’s car accident?

As a parent, one of the scariest moments is when your child is gets behind the wheel of a car for the first time. One of the many things that are probably running through your head as they pull out of the driveway is whether you are personally liable if your child causes a car accident. More than likely, you purchased their car and are paying their insurance, so it is a fair question.

Typically, you’re not personally liable for your child’s car accident.

Fortunately, in Indiana, you are not generally personally liable for your child’s car accident. That means if he or she causes damage or injury to another, you will not be required to pay money to the injured party. There is an exception, however. Like many states, Indiana requires parents, guardians, or another responsible adult to sign a minor’s application for a permit or driver’s license. Under Indiana Code, Section 9-24-9-4, the person who signs this application agrees to be jointly liable — along with the minor — for any injuries or damages the minor causes through operation of a motor vehicle. Of course, the adult is also absolved of legal responsibility for the minor’s driving, once the minor turns 18.

Not so quick – negligent entrustment.

There’s a claim in Indiana called “negligent entrustment,” which essentially means that despite knowing your child was incompetent, unfit, and/or a dangerous driver, you let him or her drive anyway. In those situations, you can be held personally liable.

When is my child considered unfit to drive?

For the most part, Indiana courts have limited negligent entrustment claims to situations where your child would be dangerous due to physical conditions that would hamper their ability to drive, such as: intoxication, handicap by blindness, or a physical deformity. Another situation would be allowing your child to drive despite his or her never having been licensed.

Are their limits to what I am liable for?

Under Indiana Code, Section 34-31-4, a parent/guardian will be financially responsible for certain harm to a person, or damage to property, stemming from a minor’s conduct if: the parent or guardian has custody of the minor child, and the child is living with the parent or guardian. There are a couple of important limitations on this liability: the child must have caused the harm knowingly, intentionally, or recklessly, and the parent/guardian will not be liable for more than $5,000 in actual damages. “Actual damages” means that the injured person can’t recover money for non-economic losses like “pain and suffering,” which can ordinarily be a pretty significant component of damages in a personal injury case.

What can you do to protect yourself?

Hopefully, you’ve found this article before your child has caused an accident. If so, here are a few things I would absolutely consider to make sure you’re not liable for your child’s driving:

1. Make sure that your child is ready to drive – I get it, driving is considered a right of passage, a way to get some independence. But slow down! Once your child gets qualified for a learner’s permit, take the necessary time to train them in a safe location, such as an empty parking lot. After they are comfortable handling a vehicle, you can then move on to road testing.
2. Make sure they know the rules and follow them – Take the necessary time, even after they get their licenses, to ride with your children, answer their questions, and make sure they know the rules before you give them free rein.
3. No phones! – Don’t let your child drive while using a phone. Texting and driving is especially dangerous because it incorporates all types of driving distractions: (1) Visual: Takes eyes off the road; (2) Manual: Takes hands off the steering wheel; (3) Cognitive: Takes focus away from safe driving. In just the 5 seconds it takes to send or read a short text message, a person has already zoomed past the length of a football field (traveling at 55 MPH) with minimal attention on the road ahead. Also, stop doing that yourself. Kids live by example. Indiana law specifically states, drivers younger than 18 are banned from texting and cell phone usage. Furthermore, Indiana law states all drivers, regardless of age, are banned from text messaging while driving.
4. Take traffic cases seriously – If your child gets a speeding ticket (or other traffic infraction), don’t let it just slide. Remember, small acts of negligence can cause people to die – literally. If they can’t follow the rules, they can’t drive.
5. Drinking or Drugs? No Car – forever. Look, I know this goes without saying, but if your child is using illegal substances, they have a lot of issues going forward. One thing, though, is you don’t want to be held liable if they kill someone in a car. Tough love is sometimes necessary.
6. GET ENOUGH CAR INSURANCE – Remember, in Indiana, you can protect yourself from personal liability simply by purchasing enough car insurance. Do not rely on your insurance agent telling you that you’re “fully insured.” In Indiana, you can be fully insured with as little as $25,000 in coverage. In serious car accidents, that’s a drop in the bucket. At Fleschner Law, we recommend you purchase $500,000 in both liability and underinsured motorist coverage. For only a couple hundred bucks more a year, you can avoid the stress of losing everything you’ve built by simply having proper insurance.