Auto insurance. It’s something that you don’t want to have to use but want to know it is there if you need it.
This really comes in handy if you get into an accident with an uninsured driver, as about 12.6% of drivers in the United States do not have car insurance.
There are several different options when it comes to choosing insurance policies, with one of them being no-fault auto insurance.
What is no-fault auto insurance? This is your guide.
What Is No-Fault Auto Insurance?
To put this simply, it is a type of car insurance that allows for your own car insurance company to cover personal injuries no matter who is at fault in the car accident. This is mainly useful if you are at fault or if the driver who causes the accident is uninsured.
This type of insurance is mandatory in certain states, and sometimes, it can offer protection from unnecessary lawsuits from happening. This depends on what state you live in but some require your injuries and medical expenses to reach certain thresholds if you go outside of no-fault insurance.
For more extensive information, read this guide to auto insurance.
No-Fault States and More
As stated above, some states require you to have no-fault insurance and others have different rules. Some states offer it as an add-on and others offer it as a choice. Here is the breakdown by category.
- New York
- North Dakota
- Puerto Rico
States that offer a choice of No-Fault:
- New Jersey
States that offer No-Fault as an add-on to their auto insurance:
- New Hampshire
- South Dakota
In total, about 23 states offer no-fault insurance as an option for you in some shape or form. With Kentucky and New Jersey, your insurance is automatically no-fault if you do not make a choice.
If a state is not on this list, that means that they likely go with a more traditional type of insurance with liability, basing the expenses solely on whoever is at fault.
Pros and Cons
So, what are the pros and cons of no-fault insurance?
The pros are that you have some type of guaranteed coverage for injuries that you may suffer in an accident. Without this, car insurance may not cover you if you are not at fault in an accident or if the other driver is uninsured.
As for the cons, the truth is that this type of insurance really only covers personal injuries. If your car is stolen or if you have property damage because of a car accident, this type of insurance is not going to cover you.
Instead, you would have to seek out insurance with wider coverage. Also, if your medical expenses go over a certain threshold, then your insurance will no longer cover you and then you would have to file a liability claim in court.
Review the No-Fault Option
If you are in a state that has no-fault auto insurance as a choice or an add-on, you should seriously consider taking it in the event that you get hurt in a car accident. It is not something that you want to have to use but may end up being something you are glad you have.
For more related articles, check out the Popular Car Help section.