How do I get compensation in a car accident?

General principles of compensation

The general principles of damages were discussed in detail in our earlier article. Let us summarise at least the four most important principles:
A prerequisite for damages is

• the wrongful act,
• the occurrence of the injury,
• causation,
• fault (intentional or negligent).

Compensation for damages covers the actual damage and what the injured party has lost, i.e. lost profits. The damage shall be compensated by restoring it to its previous state and, if this is not possible, the damage shall be paid in money.

Compulsory liability

In the vast majority of road accidents, insurance companies come into play. This is due to the fact that every vehicle operator is obliged to take out so-called third-party insurance(compulsory insurance), which then covers any damage. This obligation is imposed regardless of whether the car is actively used or whether it is sitting uselessly behind the house. If for some reason the owner of the car is late in paying the compulsory liability insurance, he does not have to worry. If he forgets to make the payment, he will receive a reminder.

Of course, we can still meet people who do not have compulsory liability insurance despite the legal obligation. However, in the event of an accident, they risk both a hefty fine and having to pay compensation out of their own pocket.

The amount of compulsory insurance is influenced by a number of factors relating to the car (type, performance, year of manufacture, make, etc.) and also the policyholder (age, place of residence, bonuses and malus). It is also influenced by the range of services offered, i.e. various supplementary insurances and additional insurances.

Thus, by taking out third-party liability insurance (i.e. by taking out compulsory third-party liability insurance), the insured has the right to have the insurer pay for the damage for which the victim is liable. The amount of damages paid is based on the limits set out in the insurance contract.

Although compulsory liability insurance is primarily intended to cover damage caused to another person’s property, it is thanks to additional insurance that you can also be protected in the event of damage to your own car.

What to do if you cause a car accident?

If you have been unlucky enough to be involved in a car accident, your next course of action depends on the damage caused. If the damage to the parties involved does not exceed CZK 100,000 and if there is no damage to the health or property of a third party, then it is not necessary to call the Czech Police. In such a case, it will be decisive what the parties themselves judge and state about the accident and its cause. It is necessary to fill in the relevant insurance company’s report and state who was at fault for the accident. It is advisable to document everything, for example by taking pictures on a mobile phone.

If the Police of the Czech Republic are called to the accident, it is their investigation and conclusions that form the basis for the actions of other authorities, such as the courts or insurance companies. The police either deal with the matter on the spot, e.g. by imposing a block fine, or refer the matter to an administrative authority for misdemeanour proceedings. However, once you have paid the block fine, you have admitted your guilt and there is no remedy.

When to call the police?

Always call the police:

• if damage to any of the vehicles exceeds CZK 100,000 (including the goods being transported),
• in a traffic accident where there is personal injury or death,
• if the accident causes any damage to third party property, e.g. damage to a parked vehicle, the fence of a family house, a collision with a public lighting pole, etc,
• if one of the parties refuses to make a record or if the parties do not agree on the fault,
• where the accident damages a road or destroys or damages a part or accessory of a road (traffic sign, bollards, etc.) or damages a public utility (equipment at level crossings, etc.) or the environment (spillage of operating fluids, etc.),
• if you yourself are unable to restore the flow of traffic after an accident.

However, for more serious traffic accidents, the matter falls within the jurisdiction of the court, which will decide on the fault (e.g. for the offence of criminal damage to health, endangerment under the influence of an addictive substance, etc.) and the possible punishment.

The assessment of fault or contributory fault may have a significant bearing on the damages to be paid to the parties. It is therefore worthwhile to use legal services and consult everything in advance.

Damage being replaced

The injured party shall be entitled to claim reimbursement of the damage in its entirety. This applies not only to material damage to the car (clothing, luggage and other items), but also to damage to health, life and any non-material damage. The procedure is governed by the Civil Code.

How to claim compensation?

There are certain specifics when dealing with compensation for car accidents. The first is the aforementioned presence of insurance companies, and the second is the often high amount of damage, the repair of which can exceed the current price of the vehicle. It is also not always possible to repair the car and thus respect one of the basic rules of compensation (restoring it to its previous state).
It is always necessary to assess the actual situation, the amount of damage and the possible repair of the car. One of three methods of compensation is then chosen, which are:

• reimbursement of the cost of repairing the vehicle,
• avehicle repair cost budget; and
• total damage, or replacement of the normal cost of the vehicle.

Only reasonable and necessary costs are reimbursed, which has been repeatedly supported by court decisions.

Repair of the vehicle is the most appropriate way of dealing with the damage under the law. However, this approach is not always appropriate. If the car is too badly damaged and its repair would already exceed the normal value of the vehicle, this procedure is not applicable. However, if the insurance company’s adjuster chooses this option, he or she can usually also recommend the insurance company’s contractual service and, after the repairs have been made and invoiced, the victim will claim the costs incurred from the insurance company.

Budgeting is the second option; the insurance company provides benefits equal to the estimated costs. To determine this, insurance companies have computer systems in which the prices of spare parts and the prices of car repair services are entered.

If the price determined in this way differs significantly from the calculation of the garage itself, then it is appropriate to resolve the procedure with the insurance company, or to secure a further calculation from another garage or a forensic expert.

However, the insurance company should not reduce the budget by including older spare parts instead of new ones. It is not right to require the injured party to find spare parts of the appropriate age (as has also been held in a number of judgments).

Reimbursement of the normal value of the vehicle (so-called total loss) is a situation which occurs, for example, in very old vehicles. In such a case, the repair of the vehicle may far exceed the current (normal) price of the vehicle, which is therefore no longer worth repairing. In such a case, the insurance company will determine the cost of purchasing a given type of car in a similar technical condition and year of manufacture, equipment, etc. The usable residues of the car are usually deducted from this price.

The cost of hiring a replacement vehicle

Another cost to be covered is the cost of hiring a replacement vehicle if the injured party is unable to use his car while it is being repaired. However, insurers usually also monitor the repair period carefully and are reluctant to cover costs for longer than is usually necessary for a given repair.

Insurance company recourse

In certain circumstances, an insurance company can recover from the insured what it has paid to the injured party by using what is known as a recourse claim. This is subject to the insured’s breach of a legal obligation. The various grounds are listed in the Motor Vehicle Liability Insurance Act.

This may occur, for example, in a situation where the insured caused the injury intentionally, left the scene of the accident without any reason, drove under the influence of alcohol, drove a car that he used illegally, or drove a vehicle that had obvious technical defects.

Damage to health

Car accidents are not only associated with damage to property, but unfortunately also damage to life and limb. The injured person’s medical treatment, surgery or hospital stay will, of course, be paid for by his or her health insurance company. However, the latter may then make a recourse claim either to the commercial insurer of the person at fault or directly to the person at fault.