Insurance exists to cover expenses in the event of an accident. In the normal course of action insurance companies will first determine fault and then proceed to assess claims. However, some states skip this phase of assessing claims and instead move to institute a mandatory, no-fault insurance policy.
No-fault insurance, also known as personal injury protection, is a type of coverage that is designed to compensate for medical expenses or loss of income in the event of a car accident regardless of who was at fault. This is different from traditional insurance that seeks to determine fault to find which company’s insurance should cover the expenses.Â
No-fault insurance typically covers medical expenses for a driver and any passengers in their vehicle at the time of the accident. No-fault insurance can cover bodily injury, property damage, and personal injury. Notably, no-fault insurance does not automatically cover damages to the individual’s vehicle.
As opposed to at-fault insurance which requires fault to be determined following an incident, no-fault insurance immediately begins the process of dispensing compensation to individuals who file a claim.
No-fault insurance covers three things: bodily injury to the other driver, property damage caused by the individual, and medical expenses associated with the individual and their passengers as a result of the accident. Notably, no-fault insurance does not automatically cover damage to the driver’s vehicle.
Living in no-fault states that do not assess blame can make it more difficult to receive additional compensation. Because the state does not outright assess compensation based on blame, it is an uphill battle to receive a verdict favoring the plaintiff if an individual chooses to file a lawsuit against either the insurance company or the individual.
