At-Fault and No-Fault Accident Compensation Schemes: What’s the Difference?
If you get into an accident, your car insurance policy can help compensate for your damages. However, the process of getting compensation can change per state. The state you live in might have either an at-fault or no-fault accident compensation scheme. This can also affect the process you need to go through in order to get financial compensation. Either way, you must learn about the regulations and procedures that apply where you live. This can help you if you get into an accident.
Are you confused about the differences between at-fault or no-fault accident compensation schemes? Read on to learn more:
Table of Contents
At-Fault Accident Compensation Scheme
In an at-fault accident compensation scheme, the driver who caused the accident is financially responsible for covering the cost of the damages of other people involved in the incident. This basically means that the at-fault driver can file an insurance claim or use out-of-pocket money to pay for other people’s losses linked to the accident. At-fault states have this type of compensation scheme.
For instance, you accidentally rear-ended the vehicle in front of you because you got distracted. In this case, you are the at-fault driver. If you cause the accident, you’ll use the property damage liability parts of your car insurance policy to pay the damages to the other driver’s vehicle. If the other vehicle’s driver or passengers got injured in the accident, your bodily injury liability insurance is meant to cover their medical treatments. However, these coverages can only be used as indicated on your policy limits. Any cost exceeding your policy limits might need to be paid out of your pocket.
Does Full Coverage Car Insurance Cover At-Fault Accidents?
The short answer is yes. However, full coverage car insurance might not be as “full” as you think. This type of insurance is usually a bundle of liability insurance, comprehensive insurance, and collision insurance. These can generally cover at-fault car accident costs, but they might not include other additional damages related to accidents. These can include costs of medical treatments for the at-fault driver’s injuries, emergency road service, and more.
Full coverage car insurance definitely has the correct types of protection for at-fault accidents. However, it might not be enough for severe accidents where some people might’ve sustained life-threatening injuries. This is why you always need to pay attention to your insurance coverage and policy limits, so you can responsibly respond to an accident you caused.
No-Fault Accident Compensation Scheme
If the compensation scheme is called “no-fault,” who pays? With this type of compensation scheme, all injured people involved in the accident are entitled to compensation for their medical treatments regardless of who caused the accident. This means that involved parties can use their personal injury protection (PIP) coverage to pay for their medical costs. However, this doesn’t mean that they don’t need to determine who caused the accident. They still need to pinpoint fault because the at-fault party needs to compensate for property damages received by other parties.
The “no-fault” portion of this compensation scheme only applies to select damages. These can vary per state, but it usually covers the following damages:
- Medical costs
- Loss of income related to the accident (has a maximum dollar limit)
- Costs to replace services (inability to drive, do chores, etc.)
- Funerals costs if the accident caused the death
A no-fault compensation scheme usually has easier procedures because you can simply file a claim with your own insurance provider. Then, they can pay out your compensation without needing to prove who caused the accident. However, a no-fault accident insurance coverage has its own limitations and policies in terms of the types of compensation you can get.
Does California Follow a No-Fault Accident Compensation Scheme?
California doesn’t follow a no-fault accident compensation scheme. In California, an injured driver can generally file a claim against the at-fault driver’s insurance as the first option. However, that means you need to file a strong insurance claim in order to receive your rightful compensation. To do that, you need to have solid proof to prove fault. Although, insurance companies might find ways to pay out a minimal amount. So, you might need an attorney to help you build your claim.
In some instances, the at-fault driver’s insurance might not be enough to cover your damages. If this happens, California car accident lawyers can advise you to pursue a claim with the insurance provider, so you won’t need to pay out of pocket. This can assure you that all of your medical expenses are sorted out.
The process of filing and pursuing a claim can become incredibly complex, intense, and overwhelming. Most legal professionals suggest victims get a California car accident lawyer’s help. A professional will have better knowledge of the processes and documentation involved in building your claim. This can also help you focus on recovering and healing from your injuries.
Which States Follow a No-Fault Accident Compensation Scheme?
Here are some states that use a no-fault compensation scheme:
- New York
- North Dakota
These states generally use your own insurance as the first option to compensate for your damages, depending on the circumstances of your accident. However, some states like New Jersey, Pennsylvania, and the District of Columbia use a hybrid or combined form of the compensation scheme. Some states also offer no-fault coverage as an add-on to your car insurance policy.
Do Insurance Rates Go Up After a No-Fault Accident?
An increase in insurance rates ultimately depends on your state’s laws and insurance provider’s policies. In most states, your insurance premium won’t go up unless you’re the at-fault driver. If you’re not at fault in an accident, you file against the insurance policy of the at-fault driver for your vehicle damages. However, it is possible for your premium to increase if you filed against your own insurance policy. Some states, such as California and Oklahoma, forbid insurance providers from increasing rates following a no-fault car accident claim.
Getting Help from a Car Accident Lawyer
Whether you plan on filing through an at-fault or no-fault accident compensation scheme, dealing with insurance companies can be overwhelming. The process of filing a claim or pursuing a lawsuit can become extremely complicated, depending on the intricacies of the accident. All that combined with the stress of sorting out car accident insurance claims can be too much if you are still trying to recover from a car accident injury.
Enlisting the help of a car accident or personal injury lawyer can help you heal and recuperate much faster, while still keeping up with important timelines for your claim. On top of that, your lawyers will always have your best interest at heart and they are professionally equipped to give you the help you need.
If you’re looking for a skilled and experienced accident attorney, look no further than Jacoby and Meyers. We have a team of the best personal injury or auto accident lawyers in California, including Los Angeles, Bakersfield, Fresno, and Sacramento. Hire one of our car accident lawyers to help you get justice. Also, they can help you get the compensation you rightfully deserve, including car accident settlements and more. In addition, they can help you:
- Prove negligence
- Define the Cost of Damages
- Build a strong claim
- Negotiate a Settlement
- Proceed with important deadlines in mind
Give us a call today at 888-960-0480 for a free consultation. We are available 24 hours a day, 7 days a week to help you.