AUTO INSURANCE ARTICLE

No-Fault Coverage and What it Means for your Auto Insurance

By: coppeneur

Just a quick test to see how much you understand about your auto insurance. Is it correct to say that regardless of who was at fault in an accident, your no-fault auto insurance assures you to be off the hook? If you answered yes, perhaps you need to read through your contract again! This article is meant for you, so next time you know better what your coverage is about.

There are only thirteen states in the US, as of this writing, with no-fault car insurance protection for its state's citizens. While there is no common standard for all the states, these thirteen states offer the closest thing to no-fault protection.

This has to be said, no-fault auto insurance coverage does not get you off the hook from an accident where you are at-fault. But having one, however, provides you coverage for vehicular and personal damages in the event of an accident, no matter if you are at fault or not.

So what does it mean? No-fault coverage means that in the event that you are injured or your car is damaged because of an accident, whether you or a third party is at fault, you can go after your own insurance company for damages. If you don’t have the no-fault coverage, you need to deal with the insurance company of the driver who caused the injury, loss or damage. The thing is, it takes longer for you to claim benefits from the other party’s insurance company. This is because the auto insurance company of the other driver has to make an assessment first of who was at fault before paying out any benefits.

Think of no-fault coverage as your lifeline when you need immediate access to any medical benefits, or compensation for workdays lost, even if you were at-fault for the accident.

Usually, a police officer judges who was at fault in an accident. It could be that the may come out with a report that neither of the drivers was “at fault”. But you should not take the law enforcers’ decision as determinate of your auto insurance claims. This has to be understood only within the context of laying charges, and not in relation to auto insurance claims. Your and the other driver’s insurance company may make their own decision and arrive at a settlement based on the degree of responsibility attributed to each person. And from their determine who pays and how much for the damage claims,

Fault is not always 100% of responsibility to one driver. It may also be shared as at-fault liability in a motor accident may be from 0% to 100%. And if you get an at fault rating of more than 0%, you should know that this automatically earns an “at-fault” accident on your auto insurance record. And as much as we don’t want to be the harbinger of bad news, this may bring hikes on your auto insurance premiums.

But some auto insurance companies are more forgiving. Either they keep your driving record clean, if it’s a first-time fault, or they peg your premium at its current level but maintains the at-fault record. Should you happen to disagree with the at-fault assessment of your auto insurance company, you may contest this decision as well. But just to emphasize the point, no-fault coverage doesn’t take the driving responsibility from you.

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