No-fault auto insurance has been in existence since the 1970’s. It was created when legislation allowed individuals to claim medical reimbursements from the company they own for any type of accident. No-fault insurance was not widely practiced back in 1970’s. However, it gained popularity in the 1990’s as some states passed legislation to make them No-Fault Automobile Insurance state. These laws were designed to end long-lasting litigation that was often necessary after an accident. They also eliminated the need for large amounts of money to pay for these legal procedures. There are currently twelve states with No-fault legislation regarding automobile insurance. These are the states that have no-fault auto insurance. Florida, Hawaii. Kentucky. Massachusetts. Michigan. Minnesota. New Jersey. New York. North Dakota. Pennsylvania. Utah.
No-Fault Insurance refers to any type of automobile insurance that requires a driver have car insurance. This protects them and limits their ability to sue another driver in the case of an accident. This is a good thing for you personally as it eliminates the long-term costs and high court fees that may result from a car accident. If you live in one of the 12 states with no-fault insurance laws and are involved in a car accident, your insurance company will pay your damages. Your insurance company will have to cover the costs even if the accident was not your fault. In order to cover their damages, the other driver involved in the wreck will need to also go to their car insurance company.
It is important to understand that the driver in a PURE, no-fault automobile policy would be fully covered for all damages. Therefore, the driver wouldn’t need to sue any other driver. While Michigan is close to having “pure” no-fault coverage as a state, none of these 12 states have an identical system. They use, for the most part the minimal rules of the no fault system and the regular standard liabilities system. This system allows you to pay for damages that you cause. Understanding your state’s automobile insurance regulations and how they may differ from the no-fault system is crucial.
Important to note is that you can choose between the standard liability and No-Fault insurance. The District of Columbia is an example of this, as you can have either coverage. If you select the standard system, however, Personal Injury Protection Coverage also known as IP will be required.
Like all legislation, there are people who see the No-Fault system as a good idea. Others oppose it completely and consider it unnecessary. No-fault supporters claim that it would cost the state time and money to hold hearings on each person who would be taken to traffic court for an accident. The drivers would also be paying more if they had to pay court fees and other proceedings, even if their premiums were increased.
Critics of no-fault car insurance argue that it’s unfair for “good” drivers not to report a claim against their company if the accident was not their fault. This would result in their premium being raised. They claim that standard liability would force the driver at fault, who would be sued only once, to be more careful. Many critics believe that it is difficult to find low-cost, no-fault auto coverage.
Statistic also shows that the monthly premiums of those states who have adopted No-Fault auto insurance have been higher than those that don’t. These critics have led many states to reconsider their at-fault system. In order to find the best solution for their particular state, some state legislation has been introduced to bring automobile insurance back on their agendas. Because of opposition to this type of insurance, it is not surprising that most states with no-fault policies will change it over the next few years.
Last, but not least, it is important to emphasize that a state’s No Fault insurance law does not excuse drivers from having automobile insurance. Part no-fault states allow drivers to sue each other in the event they sustain an injury. In other words, they could sue you if your Bodily Injury Protection isn’t available. It is essential that a person familiarizes themselves with their state’s automobile insurance laws. They can sometimes be difficult to understand. You can contact the Department of Motor Vehicles to learn more about no-fault insurance or the regulations in your home state regarding automobile insurance.
No-fault insurance can help you if you are the one who caused the accident. If you reside in one the twelve states, it can hurt you by increasing the premiums and “punishing”, you if someone hits you. Find out the laws in your state regarding automobile insurance. If you live in a state that does not have mandatory coverage, ask your insurance company about it.
