What is No-Fault Insurance?

According to USNews, with no-fault insurance, also known as personal injury protection (PIP), your medical expenses and those of your passengers are covered within the limits of your policy, deductibles notwithstanding [1]. Depending on your insurer and state regulations, this coverage may extend to lost wages, funeral expenses, and more.

However, no-fault insurance doesn’t offer compensation if your vehicle is stolen or vandalized, nor does it cover damages to your car or other people’s property in a collision. Additionally, it often restricts your ability to sue for damages.

Personal injury protection or no-fault coverage is required in a dozen states and optional in several others. Minimum coverage amounts vary by state but range from less than $5,000 up to $50,000, and you may be able to increase that amount up to a certain limit

What’s the Difference Between At-Fault and No-Fault Accidents?

In the majority of states, the party deemed “at fault” in a vehicle accident is responsible for covering the injuries of the other driver and their passengers, usually through their liability insurance.

After an accident in an at-fault state, the insurance companies of both parties involved review the circumstances to determine which driver is liable. The process of establishing fault can range from straightforward to complex based on the accident’s specifics.

Claims adjusters typically determine fault by interviewing witnesses, examining police reports, and evaluating statements from those involved in the accident. They also consider photos of the damage and relevant traffic laws of the state.

Being at fault in an accident generally leads to higher insurance premiums, unless your insurance policy includes an accident forgiveness clause. For instance, with Progressive’s Large Accident Forgiveness, drivers in most states will not see their rates increase if they are at fault in an accident with claims exceeding $500.

Which States Have No-Fault Insurance?

According to NationWide, No-fault insurance stands out as mandatory coverage in specific states. Curious about where this requirement applies? Here’s a rundown of 18 states where drivers are obligated to obtain no-fault / PIP coverage, accurate as of November 2016 [2]:

Arkansas
Delaware
Florida
Hawaii
Kansas
Kentucky*
Maryland
Massachusetts
Michigan
Minnesota
New Jersey*
New York
North Dakota
Oregon
Pennsylvania*
Texas
Utah
Washington

*Kentucky, New Jersey, and Pennsylvania are known as “optional no-fault” or “choice no-fault” states. In these states, drivers choose whether they will be held to a no-fault system.

How Do Insurance Companies Determine Fault?

State laws, whether at-fault or no-fault, significantly influence the handling and payout of auto insurance claims. Furthermore, the way state laws interpret negligence plays a critical role in determining fault and the resultant claims processing.

In many instances, a car accident isn’t entirely the fault of one driver. Insurers often allocate a percentage of fault to each involved party based on the specifics of the accident.

Consider a scenario where a speeding driver rear-ends your vehicle just after you’ve abruptly changed lanes. In such cases, both parties might be deemed partially at fault. For instance, the other driver could be assigned 60 percent of the blame, while you could bear 40 percent responsibility.

The degree to which you’re found negligent affects how you recoup your claim settlement after a car accident. And each state’s laws vary when it comes to negligence.

What to do if You’ve Had a Car Accident

According to the California Department of Insurance, If injuries are present, immediately call 911. Additionally, contacting the police is crucial. In some regions, police may attend every accident based on factors like accident severity and location (note that some jurisdictions may not dispatch police to accidents on private property) [3].

Regardless, it’s important to report the accident to the police, especially if it involves a hit and run, as most insurance policies require police notification within a certain timeframe for such incidents.

Gather the following information from all drivers involved:

Names, addresses, telephone numbers, and driver’s license numbers.
License plates and vehicle identification numbers. Verify this information by requesting to see each driver’s license and vehicle registration.
Also, collect contact details for all passengers and any witnesses.

If possible, use a camera or cellphone to take photos of the damage and the accident scene, including traffic signals and potential visual obstructions.

Should you find damage to a vehicle or property and the owner is not present, leave a note with the contact information of the drivers and vehicle owners involved.

Immediately inform your insurance agent and/or company about the accident.

If there are injuries, or if vehicle damage exceeds $750, you must report the accident to the Department of Motor Vehicles within 10 days. Failure to do so can lead to the suspension of your driver’s license.

Related Articles:

See all related personal injury and accident lawsuits our attorneys covered so far.

Get a Free Lawsuit Evaluation With Our Lawyers

The Litigation Group at Schmidt & Clark, LLP is an experienced team of trial lawyers that focuses on the representation of plaintiffs in lawsuits. We are handling individual litigation nationwide and are currently accepting new legal challenges in all 50 states.

If you or a loved one was involved with these matters, you should contact our law firm immediately for a free case evaluation. You may be entitled to a settlement by filing a suit and we can help.

References:

1. https://www.usnews.com/insurance/glossary/what-is-no-fault-car-insurance
2. https://www.nationwide.com/lc/resources/auto-insurance/articles/no-fault-insurance-states
3. https://www.insurance.ca.gov/01-consumers/105-type/95-guides/01-auto/hadaccident.cfm

Is Nevada a No Fault State for Car Accidents? (Fault Matters)