What is no-fault car insurance?

No-fault car insurance means that all injured parties' insurance companies will pay for injuries regardless of who caused the accident. Liability insurance is required in all no-fault states

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UPDATED: May 28, 2020

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Here's what you need to know...
  • No-fault car insurance attempts to prevent delays in medical payments for injuries after an accident
  • No-fault car insurance means that all injured parties’ insurance companies will pay for injuries regardless of who caused the accident
  • No-fault car insurance is usually more expensive than other car insurance

Shopping for car insurance and comparing coverage can be a confusing process if you are not familiar with how auto insurance works.

If you live in a no-fault state, understanding car insurance can be even more complex.

Fortunately, there are few differences between traditional tort and no-fault car insurance quotes.

Knowing the differences between these types of car insurance coverage will help you understand how your coverage protects you after an accident.

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What does it mean to have no fault insurance?

Tort and no-fault are terms that indicate which insurance company is responsible for paying for medical and rehabilitative expenses after a motor vehicle accident.

  • Tort state – the offending party’s insurance pays for the damages to the other parties.
  • No-fault state – each party’s own insurance pays for damages regardless of who is at fault.

In a tort state, the at-fault driver’s insurance coverage pays for injuries sustained by the not-at-fault party. If you cause an accident that injures another driver or pedestrian, your insurance carrier would pay for that person’s injury expenses.

Tort liability varies considerably from state to state.

In some states, your coverage will only pay for an injured person’s medical expenses if you are solely at fault and the injured person did not contribute in any way to the accident.

In some states called comparative negligence states, the injured person may recover from your insurance coverage as long as your actions contributed more greatly to the accident than the injured person’s actions.

Determining fault can be a lengthy process, particularly if you or others involved in an accident do not clearly recall all of the details.

No-fault states seek to prevent these delays by making each person’s insurance company responsible for his or her injuries.

In a no-fault state, your insurance carrier would pay for your medical expenses, up to your coverage limits.

By reducing payment delays caused by disagreements, no-fault insurance allows injured drivers, passengers, and pedestrians to seek medical services quickly.

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How much does no fault insurance cover?

When you obtain car insurance quotes in a no-fault state, you still have to purchase liability coverage.

Liability insurance is required in all no-fault states, and you cannot purchase no-fault coverage without liability coverage.

Liability coverage kicks in when the injured person’s no fault coverage limits have been exhausted. This coverage provides additional protection if a person sustains severe injuries, particularly if those injuries require ongoing medical treatment.

Liability coverage also pays for damage you cause to vehicles belonging to others if you cause a motor vehicle accident.

No-fault coverage does not provide any payment for the replacement or repair vehicles or property.

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Personal Injury Protection Coverage

The no-fault portion of your auto insurance policy is called personal injury protection coverage.

The addition of this coverage is the main difference between tort and no-fault car insurance quotes.

Personal injury protection coverage varies from state to state:

  • In some states, such as Kentucky, this coverage is designed only to pay for medical expenses and rehabilitation costs
  • In other states, such as Kansas, personal injury protection includes payments for other losses, such as lost wages and home services

Is no fault insurance cheaper?

Because auto insurance in no-fault states includes personal injury protection coverage, car insurance is typically more expensive in these states than in tort states.

The level and types of personal injury protection each state requires insurance carriers to offer factors into the overall cost of auto insurance coverage.

Insurance company rating algorithms also factor into the cost of no-fault coverage.

In most states, insurance carriers can develop their own base rates and algorithms, which means that you might obtain different rate quotes from different insurance carriers operating in the same state.

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Lowering Your No-Fault Insurance Rates

Because insurance companies charge different rates for the same coverages, you can save money on no-fault auto insurance by obtaining quotes from several different companies.

One of the easiest ways to compare rates is to shop for quotes online.

You can obtain no-fault insurance quotes from the websites of insurance carriers licensed in your state, and your state’s insurance department can provide you with a list of licensed carriers in your state.

Insurance comparison websites can also help you obtain no-fault auto insurance rates. These websites allow you to obtain a side by side comparison of each company’s rates and coverages, showing you which company offers you the best deal.

Although looking for no fault car insurance rates is not among the most exciting tasks, taking the time to shop for quotes online can help you obtain the proper coverage for your situation while lowering your costs.

Enter your ZIP code below and we will help you find affordable car insurance by sending you FREE quotes.

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