When a driver has been in a car, truck or motorcycle accident no-fault auto insurance allows the driver to collect from his or her insurance company no matter who was at fault. Only some states have a no-fault insurance structure, but those that do have very specific laws governing when, how much and for how long the injured party may collect. Consult with an attorney to discuss how your state views fault and to determine how the laws may affect your right to recover damages for injuries.
How No-Fault Insurance Works
No-fault insurance is a system in which auto insurance pays benefits to the insured driver in case of an accident. The insurance compensates the insured driver for monetary losses, no matter who was at fault. This is contrary to systems in which the at-fault driver’s insurance company must pay the bulk of the compensation after an investigation by the insurance companies or the courts determines fault. The system is designed to streamline the process of payments to injured people and to lower the burden on the courts.
Under the no-fault insurance system, it can be more difficult to sue an at-fault driver for damages. The insured typically must have been quite seriously injured in order to take such legal action. On the other hand, monetary recovery for the insured is more certain under no-fault insurance because the compensation is immediately available through the insurance policy of the injured party. No-fault insurance policies often have a cap on the compensation they will pay.
The no-fault insurance system prevents injured parties from receiving a windfall due to the accident, but it also ensures compensation no matter who caused the accident. In a no-fault state, the other driver will also receive compensation from his or her insurance company if that driver sustained certain economic losses. The specifics of no-fault insurance laws vary widely by state.
Personal Injury Protection (PIP)
If you have a no-fault insurance policy, it is probably called a personal injury protection (PIP) package. PIP insurance pays for the medical expenses of the insured driver and the passengers who were injured in an auto accident. PIP insurance typically covers things like medical bills, wage loss and funeral expenses, but not pain and suffering or vehicle damage. This varies by state and particular insurance policy. The PIP packages have limits on what they will pay.
Is Your State No-Fault or At-Fault?
If you’ve been in a motor vehicle accident, you should speak with a personal injury attorney in your state who knows your state’s laws. Call 800-868-2110 or contact us online to set up your free consultation.