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Plaintiff Finance

No-Fault Insurance: a Personal Injury Primer

November 5, 2014
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3min read

In spite of the caution that we take in our daily lives, accidents happen. When cars are involved, they happen in excess of five million times each year in the US. Though fault may be clear in many collisions, it can be more difficult to demonstrate in others. Proving liability - and receiving damages from either the negligent driver or his insurance company - can involve a lengthy process of submitting police reports, photographs, statements, and more to the other driver's insurer.

Due diligence is essential because in most states, the at-fault party can be sued directly for the damage caused; if he is uninsured or underinsured, he must pay the victim out of his own pocket.

But in some cases, fault doesn't matter at all.

In the dozen states that practice no-fault personal injury protection insurance, the victim of a car accident submits a claim to her own insurer, who pays the requisite damages even if the other driver was legally at fault. No-fault means a claim cannot be filed against the negligent driver except in two cases: either medical bills must reach a certain threshold, or the extent of injuries sustained is deemed sufficient enough to merit damages beyond what was paid out by the insurance company. These statutes aim to streamline tort provisions in car accident claims, and to limit costs associated with damages and litigation.

The states (and district) that practice no-fault personal injury protection are Florida, Hawaii, Kansas, Kentucky, Michigan, Minnesota, New Jersey, North Dakota, Pennsylvania, Utah, and the District of Columbia.

For drivers with no-fault insurance, cases can vary by state.  One constant across the board is that lawsuits are only permitted for injuries meeting a certain threshold, the definition of which varies considerably among the no-fault personal injury protection states.

An injured person can sue if the claim exceeds either a monetary or verbal - that is, descriptive - threshold. In monetary states, medical expenses must be over a certain dollar amount; in verbal states, injuries must be relatively severe - loss of body part, disfigurement, permanent disability, broken bone resulting in limited mobility, and the like - or there must be an expressed term of length of disability, which usually means full disability spanning over 180 days.

Some no-fault states have clauses in which an injured person can file a liability claim if they meet either condition; in all of them, victims may still file property damage claims directly against the negligent driver.

There are also situations where a party can incur personal liability without even setting foot in the car. Most states practice vicarious liability, in which the car's owner can be sued even if someone else was driving. Even in states that don't, the owner can be sued under the theory of negligent entrustment, alleging it was careless of the owner to enable the driver.

Accidents can sometimes turn into very sketchy situations very quickly, so the best defense a driver has is documentation.  Open communication with the other driver, if possible, is always a great option to ensure that the story from both sides has few, if any gaps.  Finally, accident victims should always consult with a legal professional should the need arise.

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