What are my options if I hit a car with no insurance but I am under a lease?

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What are my options if I hit a car with no insurance but I am under a lease?

I was driving late at night and was falling asleep at the wheel, I hit a parked car with no one in it, from the looks of it, it seemed like my car was totaled from the front. I am currently on a lease that ends in February and will be left owing around 18K. My problem is I didn’t renew my insurance 4 months ago because i could’t afford it. So currently have no insurance, I was wondering if the GAP insurance I paid for when I got my lease would help cover me at all or what options do I have to not be stuck paying the 18K and not having the

actual car. And for the car I hit it was an old car which I look to be valued online at $500-$1000 if I pay for the value of the owners car out of pocket does he have any right to take legal action against me? Also, there was no police report filed on sight.

Asked on September 2, 2018 under Accident Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

1) GAP insurance will not much, if at all help: it covers only the "gap" between the fair market value of the car and the amount you still owe, so that between the two, the balance is paid off. It will not cover any amounts up to the fair market value, and most likely it will not kick in at all, since technically, there is no "gap" to cover--without insurnace, you are not receiving any compensation for your car. If you pay up to the fair market value of the car out of pocket, then the GAP may kick in to cover the balance.
2) If you pay the full value of the car, while he could try to sue you, he won't get anything in addition for the car from you--he will already have received his full compensation for it. But if he had to pay to have the wreck towed, had to pay for a rental car for a period of time until he could reasonably get a new car, or incurred some other similar out of pocket cost in connection with you totalling his car, he could sue you for that--UNLESS, that is, he signed a written settlement agreement that the money you paid him was payment in full for all claims arising out of the accident. If you do settle with him, have him sign first before you pay.


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