What is an 80/20 Auto Insurance Settlement?

An 80/20 auto insurance settlement is one that shares the blame between two drivers with the driver who is mostly at fault covering 80 percent of the damages. An 80/20 car insurance settlement is just one of many ways insurance companies can decide to split the blame between drivers. You may see a 50/50 settlement or 70/30 settlement depending on the kind of accident you've been involved in, but 80/20 auto insurance settlements are the most common.

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Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Written by Rachel Bodine
Insurance Feature Writer Rachel Bodine

Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insurance...

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Reviewed by Leslie Kasperowicz
Farmers CSR for 4 Years Leslie Kasperowicz

UPDATED: Jun 6, 2022

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If you’ve been dealing with a car insurance claim, then you may have been approached with an offer for an 80/20 insurance settlement.

What is an 80/20 insurance settlement? Should you accept an 80/20 auto insurance claim? Today, we’re explaining everything you need to know about an 80/20 car insurance settlement.

An 80/20 Auto Insurance Settlement Shares Blame Between Two Drivers

Car insurance companies need to determine fault after an accident. The insurance company of the at-fault driver will pay the insurance company of the not-at-fault driver.

With some claims, this process is very straightforward. The at-fault driver rammed into the not-at-fault driver at a stoplight because he was using his phone, for example. The at-fault driver is 100% at-fault.

In many claims, however, the fault isn’t so easy to determine. Some claims get split 50/50, with both drivers sharing an equal percentage of the blame.

With other accidents, the blame is split 80/20, which means one driver was mostly at fault but the other driver also played a role. One driver clearly caused the accident (giving them 80% of the blame), but the other driver’s actions also played a role in the accident (giving them 20% of the blame).

80/20 is just one possible blame ratio. Insurance companies might also use 90/10, 70/30, 60/40, or whatever other ratios they deem accurate.

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Examples of 80/20 Accidents

There are many situations where an 80/20 insurance claim could emerge.

Sometimes, we see 80/20 insurance claims with rear-end collisions. Typically, a rear-end collision is 100% the blame of the rear driver. However, we sometimes see a portion of the responsibility assigned to the front driver. The front driver might have “brake checked” the rear driver, for example, or stopped short of an intersection. The rear driver is still more at fault for driving too fast or too close to the front driver, but the front driver is not blameless here.

In other cases, we might see an 80/20 insurance settlement for a T-bone accident at an intersection. Driver A might have made an unsafe left turn in front of Driver B. Driver B collides with Driver A. Driver B is mostly at-fault because Driver B made the hazardous turn. However, Driver A might be found at-fault because Driver B was speeding.

Ultimately, every accident situation is different. Insurance companies will use police reports, witness statements, dashcams, and other evidence to determine fault after an accident accurately.

What Does an 80/20 Car Insurance Settlement Mean for Compensation?

With an 80/20 insurance settlement, the at-fault driver’s insurance company will pay 80% of the compensation, while the not-at-fault driver’s insurance company will pay 20% of the compensation.

You are 80% at-fault for the accident, so you (or your insurance company) will pay 80% of the compensation owed. As the at-fault driver, you are entitled to only 20% of the amount awarded, as you are liable for the other 80%.

Be Wary of 80/20 Insurance Settlements

It’s in the insurance company’s best interest to reach an 80/20 insurance claim. It lessens the financial cost for one insurance company, shifting at least a portion of the blame (and a part of the payout) to the other driver’s insurance company.

Some shady insurance companies will use 80/20 insurance claims to their advantage.

Your claims adjuster, for example, might urge an 80/20 insurance claim if they find that the innocent driver doesn’t have insurance. In this case, the innocent driver has no way to claim the additional 20%, which saves the car insurance company money.

If you were not at-fault for an accident in any way, then you should not be assigned any blame. If a claims adjuster is pushing for an 80/20 insurance claim, then it’s within your right to push back. If the insurance company continues to insist on an 80/20 insurance claim without merit, then consider hiring a lawyer.

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Consider Hiring a Personal Injury Lawyer

Agreeing to an 80/20 settlement is an important decision for several different reasons.

Many states have proportional comparative fault laws, for example. This law states that you cannot file a lawsuit against another driver if you were more than 51% at fault for the accident. If you get into an accident and were mostly at-fault for the accident, then you may not be able to file a lawsuit against the other driver.

In some states, you cannot claim any compensation after an accident if you receive any blame.

Agreeing to an 80/20 settlement can also play an essential role with compensation both today and in the future. It could reduce your ultimate payout from the insurance company. It could make it more challenging to claim whiplash and other damages.

Every 80/20 accident situation is different, which is why we recommend talking to a lawyer if you disagree with your insurance company’s findings.

Final Word

An 80/20 insurance settlement assigns 80% of the blame to one driver and 20% of the blame to another driver. It’s a typical insurance settlement for situations where one driver is mostly to blame, although the other driver also played a small role.

If you were absolutely not at fault for the accident, then never accept an 80/20 insurance claim. Insurance companies may use 80/20 insurance settlements for their own benefit – at your expense. Consider talking to a lawyer to ensure you get fair treatment after a car accident.

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