Whether it's required in your state or you've added it to your policy, no-fault or "personal injury protection" (PIP) coverage can make things easier after a car accident.
Drivers are required to carry no-fault car insurance in a number of states, and it's available as a coverage add-on in most others. This kind of insurance is meant to streamline the injury claim process after a car accident, but things can play out differently if your injuries are serious enough. Here's what to know:
- With no-fault coverage, your own insurance company will pay your medical bills and certain other out-of-pocket losses no matter who or what caused your car accident.
- Even in states where it's required, you can always step outside of the no-fault system if the medical bills resulting from your car accident reach a certain dollar amount, or if your injuries qualify as "serious" enough.
- "Personal injury protection" is another name for no-fault car insurance, and you can usually add it to any policy.
How No-Fault Car Insurance Works
When you're in a car accident in a no-fault car insurance state, your own car insurance company pays for certain accident-related losses, regardless of who caused the crash. In most states, no-fault car insurance is considered "primary to" your health insurance, meaning it pays for any medical treatment made necessary by your car accident injuries before your health coverage kicks in.
So, when you make a no-fault car insurance claim after an accident, you don't have to worry about showing that the other driver was at fault for the crash. There's no back-and-forth over who pays. You turn to your own car insurance first, and often exclusively.
What's Covered by No-Fault Car Insurance?
You make a no-fault car insurance claim to get compensation for out-of-pocket losses stemming from a car accident—most notably medical bills and lost income—up to your coverage limits. Other covered expenses might include the cost of getting household help when you're unable to perform your usual chores, and reimbursement for getting to and from medical appointments if you're unable to drive. The details depend on where you live, and the fine print of your policy.
So, what's not covered in a no-fault car insurance claim? The good news is that when you file a no-fault claim with your own car insurance company, the process is typically conflict-free, and payment usually comes a lot faster than it might with a traditional fault-based car insurance system. The bad news is that unlike in a fault-based claim system, you can't recover compensation for any "pain and suffering" resulting from the accident and your injuries in a no-fault claim. Especially when injuries are significant, pain and suffering damages can really add up after a car accident, but only true out-of-pocket or easily quantifiable "economic" losses are compensated with no-fault.
It's possible to step outside the restrictions of no-fault and pursue a claim or lawsuit against the at-fault driver (which would allow you to recover for the full spectrum of damages, including pain and suffering). But to do this, your car accident injuries (and/or the cost of treating them) must qualify under the threshold in your state. For example, in Minnesota you can pursue a claim against the at-fault driver if:
- you've incurred at least $4,000 in "reasonable" car accident-related medical expenses, and/or
- you've suffered 60 days of disability, permanent injury, or permanent disfigurement because of the accident.
The other big category of car accident-related losses that no-fault coverage won't help with is vehicle damage. You can turn to your own collision coverage (if you're at fault) or to the other driver's property damage liability coverage (if they're at fault) to get your car fixed or replaced after an accident, but no-fault won't apply.
Who Else Is Covered Under My No-Fault Car Insurance?
Your no-fault or PIP insurance probably covers any passengers who are in your vehicle at the time of the accident, and anyone who borrows your car with your permission, and it may also cover others injured in a traffic accident involving your vehicle (including pedestrians and bicyclists). The coverage picture can get a bit blurred if the injured person has their own insurance coverage, however.
What Are the No-Fault Car Insurance States?
No-fault car insurance is more or less mandatory if you want to register and drive a vehicle in:
- Florida
- Hawaii
- Kansas
- Kentucky
- Massachusetts
- Michigan
- Minnesota
- New York
- North Dakota, and
- Utah.
A "choice no-fault" or "hybrid" system is in place in the District of Columbia, New Jersey, and Pennsylvania. That usually means car insurance customers can choose whether they want to go with no-fault or fault-based liability insurance (at the time of the policy purchase, or after an accident occurs, depending on the state). Note that in some states (like Delaware and Oregon), drivers are required to buy no-fault as a policy add-on, but there are no restrictions on your right to pursue compensation from the person who caused your car accident.
In states not mentioned above, you can get "personal injury protection" or PIP coverage as an add-on to your policy (on top of the liability coverage that's required in your state, for example).
What's Next?
If you've been injured in a car accident in a no-fault state—and especially if you think your injuries might allow you to make a claim against the at-fault driver—it might be a good idea to discuss your options with a skilled legal professional. Use the tools on this page to connect with a car accident lawyer in your area, and learn more about when you need a lawyer for your car accident claim.
