No Fault Insurance Explained

No Fault Insurance Explained

No-Fault Insurance Explained
If you’re fortunate,​ or​ depending on​ how you​ look at​ it,​ unfortunate to​ live in​ one of​ the​ twelve states that are under a​ non-fault auto insurance system,​ you​ can cause an​ accident,​ yet your insurance company won’t pay for the​ other parties’ damages.
If you​ live in​ a​ No-fault state (DC,​ FL,​ HI,​ KS,​ KY,​ MA,​ MI,​ MN,​ NJ,​ NY,​ ND,​ PA,​ UT) that means you​ live in​ a​ state that both requires drivers to​ carry insurance for their own protection and places limitations on​ their ability to​ sue other drivers for damages .​
Your auto insurance company will pay for your damages (up to​ your policy limits),​ regardless of​ who was at​ fault for the​ accident .​
Any other drivers involved will be covered by their auto insurance policies .​
Since all are required to​ carry insurance,​ in​ theory,​ there should be no uninsured motorists in​ those states .​
Stop laughing; the​ term in​ theory was used!
These states opted for the​ no fault insurance system because it​ guarantees every driver immediate medical treatment in​ the​ event of​ an​ accident .​
Further,​ it's intended to​ reduce the​ legal and administrative fees associated with insurance claims .​
Again,​ in​ theory,​ this should equate to​ lower premiums .​
Unfortunately,​ often times the​ liability issues that still remain will actually drive premium costs up.
However,​ because no state is​ pure no fault,​ drivers can always be held financially responsible for the​ cost of​ injuries they cause in​ certain circumstances – that’s the​ loop hole .​
Some states allow injured parties to​ sue if​ their injuries meet certain standard for severity,​ while others allow it​ when total costs reach a​ certain dollar level.
Below is​ a​ classic case of​ a​ no-fault situation .​
Neighbor lived in​ a​ four-plex apartment building .​
It had a​ 4-stall garage along with a​ 4-stall wide driveway .​
Because the​ driveway was so wide it​ was second nature for the​ tenants to​ pull out of​ their parking spots and turn around in​ the​ driveway instead of​ backing into the​ street.
One Sunday afternoon,​ one of​ the​ tenants decided to​ go visit a​ friend .​
She got into her car and began backing out of​ the​ driveway in​ her normal manner .​
When all of​ a​ sudden she felt a​ bump and heard a​ scream .​
At first she thought she ran over her cat who would occasionally escape .​
She opened her car door and found half of​ a​ body .​
Scared half out of​ her mind,​ she shut the​ car off and ran into the​ house and immediately called 911.
The driver was too scared to​ go outside at​ that point .​
As far as​ she knew,​ the​ half body,​ belonging to​ one of​ her neighbors,​ was still under the​ car and the​ driver was certain the​ injuries were serious .​
Her left rear wheel had crossed her body from her thigh on​ one side on​ the​ diagonal to​ above her pelvic region .​
The driver later learned that some strong man from across the​ street came over and picked up the​ car so she could get out from underneath.
The neighbor announced that she was feeling fine and didn’t want to​ go to​ the​ hospital .​
But the​ police and ambulance didn’t feel the​ same way so they took her the​ four blocks to​ the​ hospital .​
Turns out the​ neighbor was sunbathing behind her car and somehow the​ driver didn’t see her when she walked to​ her car .​
She ended up with no broken bones,​ no internal injuries; just a​ tire track from her right thigh across to​ her left stomach.
The driver felt absolutely terrible,​ accepted full responsibility,​ wanted to​ do everything and more to​ make it​ up to​ her .​
The next day,​ the​ driver phoned the​ insurance company to​ explain to​ them what had happened .​
They asked her two questions .​
#1 Does she drive? (yes) and #2 Does she own a​ car? (yes) .​
The insurance company informed the​ driver that due to​ No Fault insurance the​ neighbor’s own car insurance would have to​ cover the​ medical costs .​
The driver was clearly at​ fault,​ yet the​ driver’s insurance wouldn’t cover the​ damages even though it​ was her fault.
The driver went as​ far as​ to​ tell the​ neighbor to​ sue her since it​ was her fault and she felt totally responsible .​
The neighbor merely responded,​ It was just an​ accident .​
The lesson here - next time lay on​ the​ grass,​ instead of​ the​ drive way to​ sunbathe and risk the​ doggy doo.
Interesting No-Fault system,​ wouldn’t you​ say?

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