Insurance Collection Department

What is the name of your state (only U.S. law)? Florida

Hello,

I owned a motorcycle that I lent to a friend over the summer. He had no vehicle and I was doing it as a favor because I also have a car and it wasn't a necessity for me.
In July he was involved in a fairly serious crash that involved a vehicle. The front of the vehicle (small suv) struck the left side of the motorcycle. The motorcycle was totaled, the suv had extreme damage in the front. My friend was beat up pretty bad, needed over 100 stitches, but somehow escaped serious injury. The accident was ruled his fault because a witness said he ran a red light. My friend claims the other people ran the red light, but at this point there is no real way to prove otherwise and I just choose not to have an opinion on the matter because nothing can be done.

When I first gave him the bike at the start of the summer I instructed him to get insurance on it. However, he never followed through with that. Therefore, I was not compensated for my bike. As upsetting as it was I made peace with it and decided to chalk it up to an expensive (bike was worth about $3500) life lesson. I should have followed through better to make sure he was covered or better yet not let someone borrow something like that - hindsight is better than foresight.

It's several months later now and I've begun receiving collection letters and calls from the other parties insurance collection department. According to this letter I owe about $7,000 dollars for the damages to the other vehicle.

They told me this could not affect my credit score, but that it could possibly result in a suspension of my license or a lawsuit.

1. Am I obligated to pay this?

2. I am a college student and do not have that kind of money. I’ve explained this to them several times and they’ve recently mentioned that they would probably agree to settle for a lesser amount. If I am obligated to pay this, what is the best guess for how low I can negotiate to settle this for?

3. Is it true that they can suspend my license?

4. How long would it take before they took action to get my license suspended or filed a lawsuit?

Any additional help would be greatly appreciated

1. Am I obligated to pay this?

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generally not unless sued and you lose.

2. I am a college student and do not have that kind of money. I’ve explained this to them several times and they’ve recently mentioned that they would probably agree to settle for a lesser amount. If I am obligated to pay this, what is the best guess for how low I can negotiate to settle this for?

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not a clue.

3. Is it true that they can suspend my license?

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unless fault was attributed to your friend, I doubt it, especially since your friend claims he wasn't at fault. If fault was attributed to your friend, I do not know if your license can be suspended. I presume your friends could though.

4. How long would it take before they took action to get my license suspended or filed a lawsuit?

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they could file a suit at any time.

anything you are found liable for, you likely have an action against your friend for.

Fault was attributed to my friend, I was just saying he claims it wasn't his fault. No way of telling which driver is telling the truth, but the fact is he is legally the party at fault (he was issued a ticket, he was unconscious, so couldn't fight it or give his side of the story)

I understand that I could most likely sue him for this, but I've also been told that he could sue me for his medical costs/problems/etc because I was the owner of the bicycle, which in the end would be far higher than the money I would gain from suing him for this. Is this true?

It was your bike, therefore it was YOUR responsibility to get insurance on it. Your friend could not have gotten insurance on it since he didn't own it. You were negligent in allowing him to drive it knowing it was uninsured. Both you and the driver are liable for the damage he caused. And he's not at fault because of the other driver's word alone, he's at fault because an impartial witness saw him run the red light too. Given that he was knocked out, he probably can't remember whether he ran the light or not.

Ignoring this won't make it go away. Your best bet is to make payment arrangements. They MAY be willing to accept a fairly low amount per month as long as you are consistent in your payments. You can consult a lawyer if you like, but be prepared to hear that it will cost you more then $7k to defend the suit and/or pursue your friend. The consolt shouldn't cost too much though.

It's a licensed motor vehicle, no different than a car. You as the owner of the vehicle, are required to have it insured, annually registered, and safety inspected (assuming Florida has annual inspections like most states).

Florida's Financial Responsibility law (Chap 324) holds the owner of a vehicle responsible for all damages caused by the vehicle. This is done because motor vehicles are inherently dangerous, and can easily cause massive damage. When an owner permissively allows another to operate the vehicle, the owner is still held financially responsible.

You can still sue your friend for the damages caused, both to your bike and the other vehicle that you are required to pay. You don't escape liability due to his failure to pay you.

I don't know of he can sue you for his medical injuries. That would take more research than I'm willing to do.

You should probably get at least an initial consultation with a lawyer. There are plenty of options, including offering to settle, letting the case go to trial, and possibly bankruptcy.