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[N306]No Fault Insurance Coverage

by Tom Mcknight, Tom

If you live in a No-fault state (DC, FL, HI, KS, KY, MA, MI, MN, NJ, NY, ND, PA, UT) that means you live in a state that both requires drivers to carry insurance for their own protection and places limitations on their ability to sue other drivers for damages. Your auto insurance company will pay for your damages (up to your policy limits), regardless of who was at fault for the accident. Any other drivers involved will be covered by their auto insurance policies. Since all are required to carry insurance, in theory, there should be no uninsured motorists in those states. Stop laughing; the term “in theory” was used!

These states opted for the no fault insurance system because it guarantees every driver immediate medical treatment in the event of an accident. Further, it's intended to reduce the legal and administrative fees associated with insurance claims. Again, in theory, this should equate to lower premiums. Unfortunately, often times the liability issues that still remain will actually drive premium costs up.

However, because no state is pure no fault, drivers can always be held financially responsible for the cost of injuries they cause in certain circumstances – that's the loop hole. Some states allow injured parties to sue if their injuries meet certain standard for severity, while others allow it when total costs reach a certain dollar level.

Below is a classic case of a no-fault situation. Neighbor lived in a four-plex apartment building. It had a 4-stall garage along with a 4-stall wide driveway. Because the driveway was so wide it was second nature for the tenants to pull out of their parking spots and turn around in the driveway instead of backing into the street.

One Sunday afternoon, one of the tenants decided to go visit a friend. She got into her car and began backing out of the driveway in her normal manner. When all of a sudden she felt a bump and heard a scream. At first she thought she ran over her cat who would occasionally escape. She opened her car door and found half of a body. Scared half out of her mind, she shut the car off and ran into the house and immediately called 911.

The driver was too scared to go outside at that point. As far as she knew, the half body, belonging to one of her neighbors, was still under the car and the driver was certain the injuries were serious. Her left rear wheel had crossed her body from her thigh on one side on the diagonal to above her pelvic region. The driver later learned that some strong man from across the street came over and picked up the car so she could get out from underneath.

The neighbor announced that she was feeling fine and didn't want to go to the hospital. But the police and ambulance didn't feel the same way so they took her the four blocks to the hospital. Turns out the neighbor was sunbathing behind her car and somehow the driver didn't see her when she walked to her car. She ended up with no broken bones, no internal injuries; just a tire track from her right thigh across to her left stomach.

The driver felt absolutely terrible, accepted full responsibility, wanted to do everything and more to make it up to her. The next day, the driver phoned the insurance company to explain to them what had happened. They asked her two questions. #1 Does she drive? (yes) and #2 Does she own a car? (yes). The insurance company informed the driver that due to No Fault insurance the neighbor's own car insurance would have to cover the medical costs. The driver was clearly at fault, yet the driver's insurance wouldn't cover the damages even though it was her fault.

The driver went as far as to tell the neighbor to sue her since it was her fault and she felt totally responsible. The neighbor merely responded, “It was just an accident.” The lesson here - next time lay on the grass, instead of the drive way to sunbathe and risk the doggy doo.

Interesting No-Fault system, wouldn't you say?

There is a type of car insurance that has been mistaken by some policy holders, seeing it as immunity against faulty or irresponsible driving. The ?no fault? insurance refers to the liabilities and policy that is managed by your state. Through this kind of car insurance, financial losses and liabilities are taken over by the residence state of the policy holder. If you have this insurance and you are held liable for an accident, your state will pay for it, whether you are to blame for the incidence or not. There are different insurance regulations for each state in the country. Some car insurance companies call this policy ?tort coverage.? When you are endowed with a no fault insurance policy, this does not mean that you can drive irresponsibly.

Each state within the United States has different application methods for the no fault insurance policy. In some states, the car insurance company covers for minor injuries due to the accident that the policy holder is in, regardless of who is to blame. On the other hand, there are some policy regulations that allow the policy holder to file for a lawsuit if his conditions are not complied with. In Florida, the car insurance company can lessen liability coverage by acquiring smaller claims from the court. This is an advantage to the insurance company because of affordable legal expenses and the cutback of total insurance costs.

If your state offers this kind of insurance policy, you might want to avail of it. The ?no fault? insurance policy covers for your minor injuries in case of accidents, even if it is not your fault. When you have this insurance and your car collides with another vehicle, your insurance company or your state laws will cover for your injuries. If you are riding with someone, you will be provided with a ?first party? benefit. Your passenger gets treated for his or her incurred injuries. If your no fault insurance policy is comprehensive, the coverage is vast. Your insurer will cover all your medical expenses and other costs. Among the states that offer this type of policy are New Jersey, Florida, Michigan, Kentucky, Kansas, and New York.

There are some state laws that allow the policy holders to add service reimbursements. This means that they are not only covered for their losses, they can also sue the third party. When you are planning to avail of a ?no fault? car insurance policy, it is up to you whether you want to add this privilege or not.

Article Source : Pg. 318

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Both Tom Mcknight & Glubakov are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Tom Mcknight has sinced written about articles on various topics from Finances, Auto Insurance and Travel and Leisure. . Tom Mcknight's top article generates over 3600 views. to your Favourites.

Glubakov has sinced written about articles on various topics from Alaska, Auto Insurance and Car Rental. Vehicular accidents are inevitable, which is why you have to prepare for such incidents. A policy is most beneficial when you ge. Glubakov's top article generates over 3600 views. to your Favourites.