What Does No-Fault Insurance Mean for a Car Accident?

When you have no-fault auto insurance and get into a car accident, you can pursue compensation for your injuries and out-of-pocket costs from your own auto insurance company. Under a no-fault system, your insurer pays for your medical expenses, lost wages, and other damages—regardless of who was at fault for the accident.

It may appear that no-fault insurance offers all-inclusive compensation for drivers without requiring them to prove fault in a car crash. A closer look, however, shows no-fault insurance only pays limited benefits through Personal Injury Protection (PIP) coverage and restricts motorists’ right to collect non-economic damages, such as pain and suffering and emotional distress.

For help understanding what no-fault insurance means for a car accident, contact the attorneys at the Law Offices of Ogle, Elrod & Baril, PLLC, at 865-546-1111 today. We offer free consultations for car crash victims.

How Does No-Fault Auto Insurance Work?

A no-fault auto insurance system lowers insurance costs by reducing costly litigation over proving fault for a car crash. The system allows drivers to seek compensation for medical bills, lost income, funeral expenses, and other out-of-pocket expenses associated with a car accident without having to build a case against the other driver.

In no-fault states, vehicle owners purchase PIP coverage that pays the expenses up to the limits of a driver’s insurance policy or the limits given under state law. No-fault insurance generally does not pay for vehicle repairs or replacement. Motorists have an option to purchase collision coverage to help in paying for car damages, however.

PIP policy limits vary on a state-by-state basis. Basic PIP coverage in Kentucky, for instance, provides up to $10,000 per person for medical expenses, lost wages, and other costs after an accident. Michigan’s PIP coverage pays all medical costs and covers up to 85 percent of victims’ lost income for a period of up to three years after a car accident.

In some no-fault states, PIP and motorists’ health insurance combine to pay for car accident injuries. In these instances, a driver’s health insurance pays for medical costs and PIP coverage pays expenses that exceed health insurance limits.

Does Tennessee Have a No-Fault Insurance System?  

No, Tennessee has a fault-based auto insurance system. This means the at-fault driver’s insurance company pays for damages. Whether an out-of-state driver has no-fault insurance or the driver is from Tennessee, you must prove which driver caused the accident and is responsible for paying damages.

What Happens When a Driver With No-Fault Insurance Causes an Accident in Tennessee?

No-fault states require motorists to purchase liability auto insurance to cover bodily injuries and property damage resulting from any accident they cause. If motorists with no-fault insurance cause an accident in a fault state like Tennessee, they can be liable for any damages resulting from the accident.

We encourage you to call us if you were in an accident a driver with no-fault insurance caused. Navigating the claims process when it involves an out-of-state policy can be difficult. We can help you pursue fair compensation for your damages.

Can Drivers From No-Fault States Seek for Additional Compensation?

Some no-fault states allow motorists to seek additional compensation outside of their PIP policies, but only if their injuries meet a certain threshold. Severe injuries, such as significant disfigurement or death, generally qualify. If they meet the state’s requirements, they can pursue compensation for the full value of their pain and suffering and other damages their PIP policy may not cover.

In some no-fault states, the requirement to seek additional compensation involves a monetary threshold. This means that injured motorists’ medical costs must exceed a particular dollar amount before they can seek additional compensation.

How Can I Talk to a Car Accident Attorney in Tennessee?

If you sustained physical injuries or vehicle damage in a car accident in Tennessee and have questions about how no-fault insurance may impact your claim, the Law Offices of Ogle, Elrod & Baril, PLLC, can help. Call us today at 865-546-1111 to discuss your car accident, your injuries, and the damages you sustained. The initial consultation is free, so there is no risk to you. Let us help you pursue the compensation you deserve after a car crash.