Automobile Accidents and Insurance: No Fault and At Fault Systems
Automobile insurance is an institutional framework for the
defense, settlement, and litigation of tort (an injury to
person or property) claims in the case of an automobile
accident.
The system of automobile accident insurance that a state
adopts answers the following question: Who pays when an
automobile accident occurs? Three systems of insurance for
automobile accidents are possible: no fault, at fault, and
a combination of no fault and at fault.
In a pure no fault system, when an automobile accident
occurs, each driver's insurance company would compensate
their insured for personal economic damages - for example,
medical expenses, lost wages, funeral expenses, and death
benefits - up to the limit of each policy, no matter which
driver caused the automobile accident or was at fault.
This coverage of personal economic damages is called
Personal Injury Protection or PIP. In this system, then, it
is essential that every driver carries automobile
insurance. The tradeoff for each driver's insurance company
paying for their own insured's economic damages is each
driver is prohibited from suing the other driver for
non-economic damages, such as pain and suffering or loss of
companionship.
Theoretically, insurance rates or premiums should be lower
in no fault states since insurance companies are saving
money by not having to initiate lawsuits or defend their
insured's in court. However, no state has adopted a pure no
fault system for automobile accidents.
Instead, states have either adopted an at fault system or a
combination of no fault and at fault for automobile
accidents. When an automobile accident occurs in an at
fault state, the driver responsible for the accident - the
driver who is at fault - or their insurance company pays
for damages.
However, it is not always clear who was at fault in an
automobile accident. And in many accidents both drivers are
to blame to some extent. Since each driver pays based on
their own proportion of fault, drivers may sue each other
to determine these proportions. In an at fault system, each
driver retains the right to sue the other driver for
damages, economic and non-economic, resulting from an
automobile accident.
If a state has adopted a combination system or a modified
no fault system for automobile accidents, drivers are
compensated by their insurance companies for economic
damages up to the policy limits and also have a right to
sue the other driver in certain situations. Usually a
driver may sue another driver for damages sustained in an
automobile accident if the damages exceed a certain dollar
amount that each state has set by statute. Some states also
allow lawsuits in automobile accidents if a driver's
injuries meet a specified standard of severity, for
example, "serious personal injury".
A state can also choose to change their liability system
for automobile accident insurance at any time through the
state's legislature. Check with insurance providers or the
state insurance board in your state to determine which type
of insurance system your state has adopted for automobile
accidents.
----------------------------------------------------
LegalView.com, the number one resource for everything legal
on the Web, has more information on car crashes at
http://crash.legalview.com , as well as other issues
Americans are inflicted with, such as brain injury
accidents or pharmaceutical recalls such as the Avandia
risks, http://avandia.legalview.com/ .
Automobile insurance is an institutional framework for the
defense, settlement, and litigation of tort (an injury to
person or property) claims in the case of an automobile
accident.
The system of automobile accident insurance that a state
adopts answers the following question: Who pays when an
automobile accident occurs? Three systems of insurance for
automobile accidents are possible: no fault, at fault, and
a combination of no fault and at fault.
In a pure no fault system, when an automobile accident
occurs, each driver's insurance company would compensate
their insured for personal economic damages - for example,
medical expenses, lost wages, funeral expenses, and death
benefits - up to the limit of each policy, no matter which
driver caused the automobile accident or was at fault.
This coverage of personal economic damages is called
Personal Injury Protection or PIP. In this system, then, it
is essential that every driver carries automobile
insurance. The tradeoff for each driver's insurance company
paying for their own insured's economic damages is each
driver is prohibited from suing the other driver for
non-economic damages, such as pain and suffering or loss of
companionship.
Theoretically, insurance rates or premiums should be lower
in no fault states since insurance companies are saving
money by not having to initiate lawsuits or defend their
insured's in court. However, no state has adopted a pure no
fault system for automobile accidents.
Instead, states have either adopted an at fault system or a
combination of no fault and at fault for automobile
accidents. When an automobile accident occurs in an at
fault state, the driver responsible for the accident - the
driver who is at fault - or their insurance company pays
for damages.
However, it is not always clear who was at fault in an
automobile accident. And in many accidents both drivers are
to blame to some extent. Since each driver pays based on
their own proportion of fault, drivers may sue each other
to determine these proportions. In an at fault system, each
driver retains the right to sue the other driver for
damages, economic and non-economic, resulting from an
automobile accident.
If a state has adopted a combination system or a modified
no fault system for automobile accidents, drivers are
compensated by their insurance companies for economic
damages up to the policy limits and also have a right to
sue the other driver in certain situations. Usually a
driver may sue another driver for damages sustained in an
automobile accident if the damages exceed a certain dollar
amount that each state has set by statute. Some states also
allow lawsuits in automobile accidents if a driver's
injuries meet a specified standard of severity, for
example, "serious personal injury".
A state can also choose to change their liability system
for automobile accident insurance at any time through the
state's legislature. Check with insurance providers or the
state insurance board in your state to determine which type
of insurance system your state has adopted for automobile
accidents.
----------------------------------------------------
LegalView.com, the number one resource for everything legal
on the Web, has more information on car crashes at
http://crash.legalview.com , as well as other issues
Americans are inflicted with, such as brain injury
accidents or pharmaceutical recalls such as the Avandia
risks, http://avandia.legalview.com/ .
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