Typically, when someone is involved in an automobile accident and they get injured and/or their automobile is wrecked, the party at fault has to pay for the injured person’s injuries or property damages. This is known as a third-party system. However, what if someone is involved in an automobile accident and they get injured or their automobile is wrecked by another party, but instead of going after the person causing the accident or their insurance company, the injured party is compensated through his or her own insurance company? This is known by a first-party system. Somewhere in between a first party and third party system falls the no-fault system. Since the 1970’s, many states adopted variations of the no-fault system in order to reduce the number of auto accident lawsuits, expedite recovery of compensation for the injured party from the insurance companies, and keep insurance premiums down.
Drivers frequently ask the following questions before purchasing no-fault automobile insurance in states that have that option to choose or after they are involved in a no-fault accident:
As briefly explained below, no fault insurance, or personal injury protection (PIP), allows insured parties to get compensated for medical bills, lost wages, or cost of rehabilitation stemming from an automobile accident regardless of who was fault in causing the accident. Currently in the U.S., 12 states have enacted no-fault laws. Out of these states, New Jersey, Pennsylvania, and Kentucky, drivers have a choice between purchasing no-fault insurance over traditional insurance. Drivers may opt for purchasing no fault insurance so that they may be quickly reimbursed for medical expenses rather than pay for out of pocket expenses and wait until filing a lawsuit to be reimbursed.
Upon filing your claim, you will be reimbursed up to the policy limit of the PIP, hospital bills and any associated loss (depending on the state law) such as lost wages if you are unable to work. The PIP may also provide death benefits. Some states may allow those who exceed the policy limits of the PIP or experience a serious death or injury to file a claim or lawsuit against the at fault driver.
You are limited to receiving reimbursement for medical expenses, lost wages, and death expenses within the policy limits of the PIP and are excluded from obtaining pain and suffering, for which you may have to file a separate lawsuit against the at fault driver, depending on your state law. Insurance companies may deny medical benefits or require you to go to their medical providers of their choice that may not find certain treatments medically necessary. Also, no-fault insurance will not compensate you for damages to your vehicle unless you buy collision coverage. Our seasoned Automobile Accident Attorneys can help you negotiate with the insurance companies if you are involved in a no fault automobile accident.
If you or a loved one has no-fault insurance and is injured in a car accident in New Jersey or Pennsylvania please contact the Personal Injury Lawyers at 1 (800) LUNDYLAW®. We are highly experienced and know how the no-fault insurance rules apply and will maximize the compensation you may be entitled to receive.