When you get caught in a car crash that leaves you injured and your property damages, who pays? Well, the answer will vary depending on your state of residence and the type of car insurance coverage that you have. Let’s discuss further.
Fault vs. no-fault
In an accident, at least one driver is usually identified as the one at fault. The party who is determined to be the primary reason for the accident is the one responsible for whatever the outcome may be. In the majority of cases, this means that the at-fault driver’s insurer will have to pay and cover the damages.
In some states, however, the no-fault process is followed. With this, every driver should carry PIP or Personal Injury Protection Coverage. This policy serves as a rider to the basic car insurance plan.
Under the no-fault policy, insurance providers are held responsible for paying the expenses, medical or material, of their policyholders no matter who’s found to be at fault.
The coverage of no-fault car insurance policy
The no-fault car insurance policy reimburses the policyholder for expenses that were incurred as a result of an injury. These include:
- Medical bills
- Wages lost
- Funeral expenses
This type of policy was introduced to the market so disputes about payments after a collision will be minimized. By having an unambiguous compensation system, the no-fault insurance policy keeps injury-related claims from reaching the courts. Additionally, it ensures that all parties receive money without any delay.
States that mandate no-fault policy has identified caps on the amount of coverage. Policyholders can make use of this policy along with health insurance coverage. This was, expenses can be cut down as the costs are split up between the providers.
There are people, however, who do not believe in the efficiency of no-fault coverage. They think that the state prohibits them from filing a case against the other party involved in the collision. But in case the coverage threshold is met or the crash caused grave injuries, additional compensation may be awarded.