When it comes to car insurance laws, fault and no-fault refers to the states’ rules on how a car accident victim must pursue the claims-filing process. In the U.S., most states abide by fault-based laws; however, 13 states actually mandate no-fault insurance policies. The state of Pennsylvania is unique in that it is neither of the two – fault or no-fault. In fact, PA classifies as a choice, or hybrid, state. What does this mean? The decision is up to each individual driver, whether to purchase fault or no-fault auto insurance.
Understanding Fault vs. No-Fault Insurance States
In fault-based insurance states, the accident victim cannot receive relief for property damage or medical bills until he or she is able to prove who was at fault for the car crash. This first has to be proven since the at-fault party’s auto insurance company will pay for the damages. Crash victims have two options in fault-based insurance states – they can file claims with the at-fault driver’s insurance company for a settlement, or they can file personal injury lawsuits against the negligent driver for further damages, regardless of the seriousness of their injuries.
On the other hand, auto accident victims in no-fault insurance states must seek damage recovery through their own auto insurance companies, regardless of which party was at fault for the crash. In a no-fault state, the victim is not required to determine fault or prove negligence of the other party to receive immediate financial recovery. The auto accident will file a claim with their own insurance company, and they should receive a prompt response. More states in the U.S. started switching to the no-fault system because following an accident, victims often need financial assistance to help cover property damages and medical expenses, and may not be able to wait until the conclusion of an accident claim investigation.
Under no-fault insurance laws, accident victims usually cannot file a personal injury claim unless their injuries meet a threshold to qualify as a serious injury. While each state’s definition of this threshold may differ, it typically refers to injuries that cause temporary or permanent disability, loss of organ or body functions, or loss of limb/disfigurement. If the crash injuries suffered do not meet this threshold, then an insurance claim will be the only form of recovery available to the victim.
Pennsylvania’s Car Insurance Laws
Pennsylvania is unique in that it uses both fault and no-fault insurance laws, and is actually considered a “choice no-fault” state. This system allows the citizens of Pennsylvania the choice to choose when purchasing their insurance coverage. Pennsylvania’s hybrid laws are complex and require motor vehicle drivers to fully understand both types of insurance systems before even taking out a policy. However, people who drive in the state of Pennsylvania are required by Pennsylvania state law to have PIP coverage (Personal Injury Protection) included in their vehicle insurance coverage. Drivers in Pennsylvania have the choice to either opt-in or opt-out of no-fault insurance rules.
If the driver chooses to opt-in, they will receive benefits from their own insurance company following a crash regardless of fault. And, if the driver chooses to opt-out, they will have to prove the fault of the other driver to file a claim with the negligent party’s insurance company. Under Pennsylvania laws, drivers are mandated to choose their auto insurance preference when buying their policies, not after a collision. And, once they purchase their insurance plan type, they must stick with it until they are eligible to switch their plan, which is usually at the end of the contract period.
When purchasing an auto insurance policy, drivers may not the listed language as fault or no-fault. Instead, the state refers to insurance options as full tort or limited tort. The option of full tort insurance means that the driver is opting out of the no-fault system and that the driver would prefer to use fault-based rules following an accident. The option of limited tort means that the driver is opting in, and wants no-fault insurance. Selecting a limited tort insurance policy limits the driver’s ability to file a lawsuit for most auto accidents, other than very limited exceptions. Limited tort means that the driver surrenders many of their rights if a crash occurs.
If you or a loved one have already been involved in a car accident, a personal injury lawyer can help with filing your auto insurance claim or investigating the fault for the crash. Contact the law firm of HGSK today at (267) 350-6600 to discuss your claim with a free consultation.