Teen Auto Insurance Quote » Fault Insurance

What is No-fault auto insurance?

Kamlesh Desai — Thu, 08 Dec 2011 01:22:27 +0000

What is no fault auto insurance?

No-fault insurance is a term used to describe the auto insurance system in States where an insured driver policy violations that paid in an accident, regardless of who was to blame for the accident occur. If you in a strict life and you buy to protect, not cover your medical expenses are not be covered if someone else caused the accident. Your insurance policy protects only they – not you.

Cheap teen auto insurance

The covering that is acquired in a no-fault State is called personal security violations or PIP. The amount and type of PIP coverage varies widely by the State. In General, an insured in a no-fault State would be reimbursed for medical costs of wages and other costs in connection with the violation, and it may in General not to sue for additional money from the person who caused the event. Other insured drivers, which can be injured by their own policy in your car or, according to the laws of the State gathered your policy.

24 States, including the District of Columbia have laws that allow the policyholder to pay for car accidents due to their own insurance. Of the 12 States, the below true “no-fault” apply as laws restrict the insurance if the policy holder can sue the person who caused the accident. The guidelines for suing will be, either on a “threshold”, meaning that costs more than a specific amount or a “verbal threshold” allows a lawsuit, if the injury of life, permanent disability or disfigurement. Additionally, some States drivers allow to seek payment for “non-economic losses”, such as pain and suffering. States, which include true no-fault States, Hawaii, Florida, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania, and Utah.

While no-fault insurance the right of an injured driver to sue is limited, which can to fault tolerance driver across the border injured personal injury protection coverage costs for be. For example, in Minnesota, driver to acquire assault and property damage must liability coverage to cover the costs that exceed the height of the PIP coverage may an injured.

In New Jersey and Pennsylvania drivers can personal security violations or buy physical injury liability coverage, which pays for injuries, is the blame for the accident. In Kentucky when drivers buy PIP coverage, they can also “back right to sue another driver, pay more for personal injury liability coverage buy”. With the increase in the number of uninsured drivers on the road, especially in urban areas offers personal injury protection often buy a better value as you have the certainty, that you will cover for your own expenses.

Strict laws apply only to personal injury. Is your car or other personal items not covered by no-fault insurance, so it is important to protect the value of your vehicle through the purchase of comprehensive and collision coverage. And purchasing property damage liability coverage pays for damage, which you one other property in a car accident, to lead, that if you are responsible for the repairs.

Mandatory coverages vary by State. Your agent or insurance company explain how does each coverage, and the decisions, you have to protect yourself and your family.

Car insurance – No fault pros and cons.

Kamlesh Desai — Wed, 11 Nov 2009 02:21:00 +0000

Jeff Walker: Thanks for the information on No fault auto insurance coverage. If this is bringing in so much auto insurance claims than why do you need “No fault coverage” under auto insurance policy? Would teenagers be able to get cheap automobile insurance coverage if the no fualt coverage was not given by insurance companies?

Car insurance : No fault

Response: Jeff, I understand what you are trying to say, however the purpose of auto insurance is not just to pay low premium but also be able to get a claim payment in the event of an auto accident. At the same time it would be wrong to spend a lot of money on legal matters and also auto insurance fraud. Let me first give you the benefits of “No fault” coverage and also the drawbacks of the No fault auto insurance.

Benefits of a no-fault system
No-fault system offers many benefits, including the following:

Quicker payment of claims by eliminating costly and time-consuming litigation over liability.

No splitting of fees with lawyers.

Lower insurance rates because expensive non-economic damage awards and legal fees required to defend liability claims are eliminated–legal fees currently account for 12% of premium costs.

Reduction in the number of lawsuits.

No subsidizing uninsured motorists; your insurer covers the cost of your medical bills.

Lower rates mean that auto insurance is accessible to people of lesser means.

Drawbacks of a no-fault system
No-fault insurance argue that the benefits are purely theoretical and that past performance has proved that no-fault is ineffective. Drawbacks include the following:

No compensation for pain and suffering, paralysis, or other non-economic damages; arbitrary limits are imposed.

Under pure no-fault and choice systems, bad drivers are protected because they cannot be sued for the damages they cause. Thus, there’s no incentive to be a good driver.

Rates are actually higher under no-fault. Regardless of theory, insurance premiums in no-fault states are on average 25% higher than in traditional liability states.

There is no reduction in litigation costs under a no-fault system. The time and effort insurers once spent defending litigation claims is now spent defending lawsuits brought by their own insureds for failure to pay no-fault benefits. In modified no-fault states, tremendous time and energy is spent litigating over whether or not the tort threshold requirement has been met.

Even your economic damages are limited by the terms of the policy. In traditional tort states, you are fully compensated for your loss by suing the driver responsible for your injuries. No-fault states have limits on liability, even for your basic economic damages. These limits result in people being forced to pay for any unpaid medical bills without recourse against the driver who caused the injuries.

Its really diffcult to decide what really works and so you will appreciate what the insurance companies also have to go through. However, keen competition in the market makes it possible for even young drivers to get cheap auto insurance quote.

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News: No fault auto insurance in New York for 2009

Kamlesh Desai — Mon, 09 Nov 2009 01:46:20 +0000

Jeff Walker (New York): I live in New York and am a teenager. I want to know what “No fault” insurance is and whether or not this would affect my auto insurance?

No fault insurance
Response: A very interesting question. The main intent for brining in “No fault” insurance was to enable cheap auto insurance rates. Normally the auto insurance rates increase due to the expense of loss or car insurance claims payments and legal expenses for settling the claims. To avoid legal payments No fault was accepted by many states like Colorado, Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania, and Utah. The more the insurance companies save on auto insurance expenses the more cheaper auto insurance rates can be.

When you have an accident under a no-fault system, your insurer automatically pays for your damages, regardless of fault (up to the specified policy limit). In exchange for this guaranteed payment, you must give up some of your rights to sue the other driver involved in the accident. There are elements of no-fault in all auto insurance coverage. For example, medical payments and property damage are typically paid regardless of fault.

Here the intent of No-fault insurance is to reduce auto insurance premiums by reducing the number of automobile accident cases in the courts, by restricting recovery for pain and suffering damages, and by providing limited payment for losses.

However, for New York, as per the latest as per the Insurance Information Institute (III), New York’s auto insurers saw their typical no-fault payment for the medical care of accident victims rise by 56 percent to $8,748 per claim in the second quarter of 2009. In late 2004, the average no-fault payment stood at $5,615 per claim.

In a speech to the New York Insurance Association (NYIA) this week, Robert Hartwig, the group’s president, said the insurance industry, the New York State Insurance Department, National Insurance Crime Bureau and law enforcement agencies continue to investigate suspicious claims vigorously, but loopholes in the no-fault system make it particularly vulnerable to what he described as “fraud and abuse by a ‘no-fault industry’ of corrupt medical professionals, attorneys, and street-level criminals who work on their behalf.”
“The costs of fraud and abuse of the state’s no-fault system ultimately are borne by New York’s honest policyholders,” Hartwig said. “New York’s no-fault claim costs are now the second highest in the country and are 111 percent higher than the U.S. average of $4,152.”

This would mean either that the cost of auto insurance premium will increase for New York and secondly as per the insurance companies they would have to take more preventive and loss control measures so that the claims can be curtailed and kept very low.

It would be best for you to shop online for cheap auto insurance quote. Please check out the quote here. You will be suprised at the amount you can save.