Only 13 US states follow the no fault car insurance system. The rest of the states rely on fault in regards to auto accidents. This system is how insurance companies determine how they will make their pay outs. Measuring fault is the basis for each case.
The problem with this traditional rationale is that it can take up a lot of time and money. Plus, it crowds an already overcrowded court system. Colorado, Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania, and Utah are the 13 states that use the no-fault insurance system.
Your insurance company provides coverage regardless of fault. It will cover to the policy limit. That is their end of the bargain but in turn you forfeit any rights to sue any other driver/drivers that might have also been involved.
Fault, in this case, wouldn't matter as medical and property would be compensated. The rationale is to not bog down the court system any further. This is done by placing limits on pain and suffering while offering limited compensation for any loss.
No fault comes in two varieties. The insurance company disburses to the policy limit for medical and loss of wages. However, the other costs you would not be allowed to sue for. Currently this type of no fault in not in use in the US. It is, in essence, superseded.
States use what is called modified no fault now. In some cases you can still bring forth a claim but your damages and lost wages are paid for. If damages surpass a specific amount then it would be possible to recoup losses. Severe injuries only can go before the courts.
This plan offers advantages. Claims are paid out much faster, no lawyers are involved, and this results in offering lower insurance premiums. The courts benefit by a reduction in court cases.
Because all drivers are treated equally, many would prefer to use a different system. Many also feel that people are not rewarded fairly for pain and suffering. There are both benefits and drawbacks in using both systems.
The problem with this traditional rationale is that it can take up a lot of time and money. Plus, it crowds an already overcrowded court system. Colorado, Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania, and Utah are the 13 states that use the no-fault insurance system.
Your insurance company provides coverage regardless of fault. It will cover to the policy limit. That is their end of the bargain but in turn you forfeit any rights to sue any other driver/drivers that might have also been involved.
Fault, in this case, wouldn't matter as medical and property would be compensated. The rationale is to not bog down the court system any further. This is done by placing limits on pain and suffering while offering limited compensation for any loss.
No fault comes in two varieties. The insurance company disburses to the policy limit for medical and loss of wages. However, the other costs you would not be allowed to sue for. Currently this type of no fault in not in use in the US. It is, in essence, superseded.
States use what is called modified no fault now. In some cases you can still bring forth a claim but your damages and lost wages are paid for. If damages surpass a specific amount then it would be possible to recoup losses. Severe injuries only can go before the courts.
This plan offers advantages. Claims are paid out much faster, no lawyers are involved, and this results in offering lower insurance premiums. The courts benefit by a reduction in court cases.
Because all drivers are treated equally, many would prefer to use a different system. Many also feel that people are not rewarded fairly for pain and suffering. There are both benefits and drawbacks in using both systems.
About the Author:
Learn more at Safe Auto Insurance and Really Cheap Auto Insurance. Chimezirim Odimba helps people save on insurance.
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