Understanding No-Fault Insurance
October 16, 2018
No-fault insurance is one of the most misunderstood legal terms. Many first-time drivers imagine that it means you are covered, even if you drive recklessly. This is not the case. No-fault auto insurance does not give you license to crash your car and cause harm to others. It simply means your claims for you and your passenger’s injuries and lost income are paid, no matter who caused the accident.
It may help to think of no-fault insurance as first-party coverage. Under no-fault, as it is applied in New Jersey and Pennsylvania, you are compensated not by the insurance policy of the other driver in an accident, but through your own policy. No-fault appears in your car insurance policy as PIP, which stands for personal injury protection.
Cons of No-Fault Insurance
The biggest beneficiaries in a no-fault system are the car insurance companies. They incur fewer legal costs and typically pay less in compensation. One can no longer file a suit against the other driver’s insurer and you are covered even when the other driver has no insurance, which happens all too often.
There is also a significant downside to no-fault. Under no-fault, your options for recovery are limited. You can sue the other party only in certain situations. This means your compensation can be less than in another state that does not have this feature. You are usually stuck with your own insurance company.
Pros of No-Fault Insurance
This does not mean no-fault insurance is always a bad thing. It provides assurance that you are covered in an accident, provided you have PIP coverage in your auto policy. In addition, no-fault removes anxiety from the process of being compensated. Since the payer is your own insurance company, you will receive a check for compensation sooner than if your case gets tied up in a lawsuit. With no-fault, you worry less about a third-party insurance company refusing to pay.
It is not a sure thing that you and your own insurance company will agree on the proper amount of compensation. The Camden car accident lawyers at DiTomaso Law step in when insurers refuse to properly compensate policyholders.
Camden Car Accident Lawyers at DiTomaso Law Help Victims of Car Accidents Claim the Compensation They Deserve
No-fault insurance in New Jersey and the Philadelphia area has its own complexities and exceptions that call out for diligent, knowledgeable legal assistance. If your insurance company is not being fair to you, or if you find yourself in special circumstances, talk to the Camden car accident lawyers at DiTomaso Law. Call us today at 856-219-4970 or contact us online for a free consultation. With office locations in Philadelphia and Cherry Hill, New Jersey, we proudly serve clients from the surrounding areas.
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