Top Things You Should Know About No-Fault Auto Insurance

No-fault auto insurance provides insurance protection and will pay certain benefits regardless of who caused an accident. Not every state recognizes no-fault auto insurance, and as such, those that do require a minimum coverage amount. When inquiring about no-fault auto insurance, ask your auto insurance agent if it is required in your state.

No-fault auto insurance, or personal injury protection, is a portion of your auto insurance policy that will cover medical bills, and loss of income, but only up to the limit of coverage. Should your medical bills, and loss of income, be more than the limits of your policy, you may have to recover your expenses in court.

Not every state is considered to be a no-fault state. Because of this, your auto insurance may or may not offer this protection. Further, because no-fault auto insurance is not required in every state, there are several differences between those that do.

Here are the top things you should know about no-fault auto insurance:

The following states require no-fault auto insurance:
Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania and Utah.

In these states, drivers do not have to prove who was at fault in an accident. Their insurance policy pays for lost wages, and medical bills up to the policy limits. In return, the driver can not take the other driver to court to try to recover monetary value for things such as pain and suffering, or emotional distress.

No-fault auto insurance does not take into consideration damages to your vehicle. As such, these claims are made either with the other driver's insurance company or in a court of law.

The following states offer no-fault auto insurance as an add-on to their auto policies:
Arkansas, Delaware, Washington, D.C., and Maryland.

In these states, the insurance will pay for medical bills and lost wages, however, either party can sue or be sued in a court of law for pain and suffering, and/or emotional distress.

Further, there are three states which have the option to choose to have a policy be based upon no-fault or a right to sue system. They are: Kentucky, New Jersey, and Pennsylvania. Though these states require no-fault insurance, in these states the policy holder retains their right to to sue for accident compensation.

No-fault insurance can be confusing. It is best to discuss your obligations and options with a qualified auto insurance agent who knows what your state requirements are.

For more information and a listing by state of minimum insurance requirements, including personal injury amounts, visit: Edmunds.com