Auto insurance

What is an 80/20 auto insurance settlement?

If you are injured in an accident and end up with $20,000 in medical expenses, your insurer will cover $16,000 of that total, and you will be liable for the remaining $4,000.

Assuming they are competent in their role, your attorney should be able to get a settlement covering over 20% of your medical bills. Companies that provide Insurance will attempt to settle with the least amount of money spent. You can expect this if you don’t have a lawyer or if your lawyer doesn’t have a lot of experience. Learn more about 80/20 car insurance settlement check it out.

The fault of a car accident is shared 80/20 between its two drivers, according to an insurance settlement

After a car collision, insurance companies must determine who is at fault. When an accident occurs, the negligent driver’s insurance company will indemnify the policyholder for the other driver’s policy.

This is an easy process to complete for some claims. At a red light, the driver responsible for the phone check rammed into the responsible law-abiding party. The driver who caused the accident is fully responsible for what happened.

However, determining fault is not always straightforward in claims. For some claims, liability is shared equally between the two drivers.

In most collisions, however, the fault is shared between the drivers, usually on an 80/20 basis. Although the other driver may share responsibility for the accident, he is still the main culprit (80%).

Assuming an 80/20 ratio is to blame is just one option. Depending on the circumstances, auto insurance providers may use a ratio of 90/10, 70/30, 60/40 or another appropriate ratio.

In car insurance, what does an 80/20 payment mean?

The offending driver’s car insurance company would pay 80% of the settlement, while the other driver’s car insurance company would pay 20%.

Since you caused this accident, you (or your insurance company) will have to pay a large part of the damages. Being the careless driver leaves you responsible for the remaining 80% of the reward, so the maximum you can get is 20%.

What benefits do you get?

Getting an 80/20 split with your insurer has many benefits. Since both parties also understand the monetary value of the claim, the settlement process can proceed more quickly. There will be no more discussions or arguments about who should pay what.

The settlement also gives you more leeway to pay related expenses, such as medical bills, that arise from your injury case. You’ll have more money left after the costs are covered, because your share of the payment is only 20% of the total. If you receive a large settlement, you can use the money to improve your quality of life while you recover.

Why opt for an 80/20 split when settling car insurance?

Here are the reasons why you should opt for an 80/20 split:

Without having to go to court, you receive the maximum possible settlement

Your legal representative can negotiate with the other party’s lawyer without worrying about going to court if you both settle for less than 20% of what you initially asked for (which would mean that he would get nothing). Plus, he can focus on finding a satisfactory solution for both of you rather than worrying about how much money he can win in the event of a dispute.

A quick way to acquire the funds you need

If you want to get paid fast, it makes no sense to use an 80-20 settlement because you don’t have to do tedious documentation or hire a lawyer. Plus, because you’re not going through a never-ending legal battle, your claim will remain private and no one else will be dragged into it.

Avoid a legal compromise

The main advantage is that you won’t have to deal with the hassle of going to court. Most auto insurance claims are resolved out of court, with the parties meeting with the adjuster, assessing the damages, and agreeing on a settlement amount before the adjuster signs the agreement. Having mutually agreed terms is known as a settlement.

If you and the other party involved in the lawsuit agree, the case can be dropped (i.e. accepting less than is due). This way, your attorney will know they can settle less than the full amount owing, even if the auto insurance company files a claim for more than 20% of the settlement.


The idea behind 80/20 coverage is simple: you’ll get significantly more protection for a small percentage increase in the insurance premium. An 80/20 policy, for example, offers a 20% higher payout than a standard policy.