Basics of No-Fault Insurance Coverage

For the majority of the states in our nation, your insurance company will make payments on your behalf based on your degree of fault in the accident. However, determining who exactly is at fault in an accident is not always so clear-cut. This is why several states have adopted a no-fault insurance policy – and it has been working out great thus far.

What is a no-fault insurance policy?

In a no-fault insurance policy, your insurance company guarantees a certain payment, regardless of your level of fault in an accident. For those who tend to be more accident-prone than others, this can save you quite a bit of cash in the long run. However, the no-fault insurance policy is not exactly without its problems, as well.

For starters, what exactly your insurance company will pay for under a no-fault insurance policy is actually quite limited. They will typically take care of medical bills and lost wages, but they will not pay for pain and suffering and other problems that arise as a result of any injuries. Furthermore, a no-fault auto insurance policy will not cover claims for vehicle damage, either.

What states currently offer a no-fault insurance policy?

At the time of this writing, there are currently thirteen states in the country that offer a no-fault insurance policy. These states are by no means required to offer this kind of auto insurance policy, and therefore it is not guaranteed that you'll be able to find a no-fault insurance policy in your area – even if your state is on this list. Moreover, additional states may begin offering a no-fault policy at any time; and you should check with your local agencies if you have any questions about this.

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