Phabbyfundz
Active member
State auto liability insurance laws fall into four broad categories; no-fault, choice no-fault, tort liability and add-on. The major difference are whether there are restrictions on the right to sue and whether the policy holder's own insurance pays first party benefit up to the state maximum amount, regardless of who is at fault in the accident. These alternative systems has evolved over time as consumers, regulators and insurers have sort ways to lower the cost and speed up the delivery of compensation for auto accidents.
The term "no-fault" auto insurance is often used loosely to denote any auto insurance program that allows policy holders to recover financial losses from their own insurance companies, regardless of fault. But in it strictest forms no- fault only applies to state laws that both provide for the payment of no-fault first party benefits and restrict the right to sue.
The term "no-fault" auto insurance is often used loosely to denote any auto insurance program that allows policy holders to recover financial losses from their own insurance companies, regardless of fault. But in it strictest forms no- fault only applies to state laws that both provide for the payment of no-fault first party benefits and restrict the right to sue.