Is a GoFundMe Account a Good Idea After a Car Wreck in Tennessee?

     Attorney Henry Queener

Starting a GoFundMe account after a car wreck may sound like a good idea, but did you know that it could affect how your car insurance pays out?  Let me briefly illustrate a scenario for you.

Let’s say you are in a car wreck, caused by someone who was distracted by their cell phone. In this situation, you have no health insurance, and your medical bills total a whopping $35,000. The guy who ran the stop sign has no car insurance. You have full coverage under Tennessee law, including uninsured motorist (this covers you when the at- fault driver does not have car insurance).  However, your underinsured motorist policy limit is $25,000. Since your medical bills total $35,000, you decide to start a GoFundMe account and successfully make up the $10,000 difference. Time to celebrate this brush with medical debt? Nope.

Under Tennessee law your underinsured motorist carrier gets a credit for any money you raise from any source. Yep, that’s right! So, your check from the insurance company is only for $15,000, not the policy limit of $25,000. The $10,000 you raised from your GoFundMe account saved the insurance company from paying its policy limit of $25,000. You essentially worked for an insurance company for free and still have $10,000 in medical bills!