Navigating Vehicle Insurance Laws: Understanding At-Fault and No-Fault States in America

Approximately six million people get involved in traffic accidents every year in America, resulting in thousands of fatalities and injuries. This has led to all states in the United States setting forth laws that require drivers to carry an insurance policy for their vehicle to protect them from liability in the unfortunate event of an accident.

However, the insurance laws may differ from one state to another. If you are a car accident victim, understanding insurance laws in your state is vital when filing a personal injury claim.

The major difference in vehicle insurance laws lies in the right to sue. In most accidents, there is one main person responsible for the accident. Typically, that is the person liable for all of the resulting damages. However, this is not always the case, and there are two main groups of states, depending on their auto accident insurance laws – at-fault or no-fault states.

At-Fault States

In an at-fault state, the driver responsible for the accident is fully liable for the resulting damages. This means that the other driver can file for damages with the at-fault party’s insurer. When an accident occurs in an at-fault state, the first step should be collecting all the necessary documentation and evidence.

Once you have everything, you may need a personal injury lawyer to help you file your claim. Upon filing the claim, the insurer will review the claim and decide to offer compensation or dispute the claim. If you cannot agree on the value of your compensation, you can choose to go to trial with the help of a lawyer. At-fault states may differ in terms of their approach to liability. These approaches are pure fault, contributory fault, and comparative fault.

No-Fault States

Individuals living in a no-fault state are able to file a claim through your insurer irrespective of who is at fault. In a no-fault state, state laws require drivers to carry personal injury protection (PIP) coverage from which they can recover their damages for bodily injury. The process of preparing and filing a claim is largely the same, with the only difference being that you will be filing a claim with your insurer.

“The fact that you are filing a claim with your insurer doesn’t mean that the process will be straightforward,” says Richard Godshall of Ostroff Godshall Injury and Accident Lawyers. That is why you may need to hire a lawyer to ensure that your rights are upheld.

Limits and Exceptions in A No-Fault Approach

In most cases, no-fault insurance coverage has limits in recoverable damages. If the value of damages exceeds the set limit, the victim has a legal right to file for damages against the at-fault driver.

Of importance to note, PIP insurance in a no-fault state covers injuries and medical expenses. Depending on the state, it may also cover lost wages. Separately, you may need to file for property damage with the at-fault insurer. You may also file a claim for other damages that are not payable under your PIP coverage.

Whether you live in an at-fault or no-fault state, a fair settlement for your claim should adequately cover all your damages, from economic, non-economic, and punitive damages if they are applicable in your case.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes.