Jessica Sautter is a Content Writer for CarInsuranceCompanies.com with a Bachelor’s Degree from Eastern Michigan University in Elementary Education with a Major in Reading and a Minor in Mathematics.

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Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

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Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager

UPDATED: Sep 25, 2020

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Key takeaways...

  • No-fault car insurance is essentially a way to process liability and not a replacement for car insurance
  • Many states have enacted no-fault car insurance laws
  • No fault car insurance laws help streamline the liability process

The term “No-Fault Car Insurance” is widely known by most drivers however it should never be assumed that no-fault car insurance is a blanket protection to indemnify drivers from all liability in a car accident.

The reason states implemented no-fault car insurance laws were to help insurance companies limit liability, provide drivers easy access to claim to process and reduce government workforce to assess responsibility.

The laws were passed with the intention that car insurance companies would benefit from the laws and help maintain affordable car insurance premiums.

No-fault car insurance is essentially a way to process liability and not a replacement for car insurance.

There are many ways a driver involved in a car accident can quickly realize he is still subject to liability even with no-fault car insurance. Use our FREE quote tool to compare rates now!

Table of Contents

Responsibility for Car Accidents

Someone has to bear responsibility for every car accident and because monetary damages are almost always involved.

Liability is a crucial factor to help determine who will pay the bills.

This legal assessment not only costs millions of taxpayers money, court time but can often last for years.

No-fault car insurance laws help streamline the liability process by eliminating the issue of fault, so each driver shares equally in the liability equation for assessing blame.

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Restrictions to Sue

In most states, no-fault car insurance prevents drivers from suing each other.

Many industry experts believe this single element has been a critical factor in maintaining affordable car insurance rates year after year.

Some states with no-fault car insurance laws do have exceptions for minor accidents.

All states allow injured parties to file suit should serious injuries occur or the offending action was deliberate or extremely negligent.

The ability to sue for silly, small items were removed from most states which many drivers will attest is both logical and efficient use of laws.

All states allow injured parties to file suit if only there are serious injuries or the offending action was deliberate or extremely negligent.

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No-Fault Can Mean Your Fault

As we stated above, no-fault car insurance is not a substitution for state minimum car insurance requirements, so every driver still needs auto insurance coverage.

In most no-fault states, you can still and will be held liable for damages to another driver should you not have auto insurance. Learn more about what happens if you have no car insurance here.

The auto insurance is heavily regulated, but any wise driver should educate themselves with state laws well ahead of buying a car.

Car insurance quotes for states with “no-fault” car insurance are very competitive so use our zip code below to search to find local car insurance companies and get a FREE quote today.

References:

  1. https://www.esurance.com/insurance/car/coverage
  2. https://www.allstate.com/tools-and-resources/car-insurance/no-fault-insurance-cover.aspx