No-Fault Vs. At-Fault Insurance

No-fault and at-fault insurance systems vary widely and can affect nearly every aspect of your claim, including:

• With whom you file your insurance claim
• How much compensation you can recover
• Your deadline to file a claim
• Your responsibilities related to the claim
• Good faith insurance practices
• Whether you need to collect evidence to establish fault
• Whether or not you can sue the at-fault party

An experienced car accident lawyer can review your circumstances and explain the insurance system that applies to your case.

Most states use an at-fault insurance system for car accidents. Here is what you should know about this type of insurance system:

What Is At-Fault Insurance?

At-fault insurance or liability insurance covers the damages you cause to someone else if you are in a car wreck. If you are found at fault for an accident, you are responsible for the resulting damages. The accident victim makes a claim with your insurance provider for the losses they suffered. This type of insurance is sometimes referred to as “full tort” insurance.

Purpose Of The At-Fault Insurance System

The at-fault insurance system makes the person who was legally responsible for the accident financially responsible for the accident. This system often rewards safe drivers with no history of accidents or traffic violations with lower insurance premiums.

States That Use An At-Fault Insurance System

Most states use an at-fault system for car insurance, including:

• Alabama
• Alaska
• Arizona
• Arkansas
• California
• Colorado
• Connecticut
• Delaware
• District of Columbia
• Georgia
• Idaho
• Illinois
• Indiana
• Iowa
• Louisiana
• Maine
• Maryland
• Mississippi
• Missouri
• Montana
• Nebraska
• Nevada
• New Hampshire
• New Mexico
• North Carolina
• Ohio
• Oklahoma
• Oregon
• Rhode Island
• South Carolina
• South Dakota
• Tennessee
• Texas
• Vermont
• Virginia
• Washington
• West Virginia
• Wisconsin
• Wyoming

The remaining states are no-fault or choice no-fault states.

Some states use a no-fault insurance system. Here are the important details of this type of insurance system.

What Is No-Fault Insurance?

With no-fault insurance, accident victims turn to their own insurance provider for coverage following an accident, regardless of who is at fault. No-fault insurance may only cover a portion of accident victims’ damages. For example, in Florida, no-fault insurance provides coverage for 80% of medical expenses and 60% of lost wages, up to $10,000.

No-fault insurance is sometimes referred to as “limited tort” insurance because it limits the insured’s right to sue. For example, the accident victim may only be allowed to sue the at-fault driver if they suffered a serious injury or a certain amount of compensation.

Purpose Of The No-Fault Insurance System

The no-fault insurance system is supposed to simplify the process of recovering benefits after being involved in a car accident. Because insured drivers are approaching their own insurance provider for coverage, the process should be friendlier and less antagonistic. Proponents for no-fault insurance also say that this type of insurance system limits lawsuits for low-value car accident claims and prevents the clogging of the court system.

States That Use A No-Fault Insurance System

Only a few states have full no-fault insurance systems in place. These include the following:

• Florida
• Hawaii
• Kansas
• Massachusetts
• Michigan
• Minnesota
• New York
• North Dakota
• Utah

These states have different rules about minimum insurance requirements and the insured’s limited right to sue.

Exceptions To The No-Fault Insurance System

Most states that have a no-fault insurance system have exceptions when the accident victim can step outside this system. For example, Florida allows accident victims to pursue the at-fault driver if they suffer a serious injury as defined under state law. Accident victims may also be able to step outside the no-fault system if their damages exceed their amount of insurance coverage. Additionally, no-fault insurance does not apply to motorcycle accidents in Florida. There are also other rules for out-of-state drivers.

Here is a summary of the key differences between at-fault and no-fault insurance systems:



• In no-fault states, you turn to your own insurance first for coverage after an accident, regardless of who was at fault
• In fault states, you file a claim with the insurance provider that covers the at-fault driver
• You give up your right to sue the at-fault driver in no-fault states in some cases, including your right to pursue pain and suffering damages
• Fault may still need to be established in no-fault states if you sue because you suffered a serious injury or damages that exceed your insurance coverage
• The state where you live dictates the type of insurance you must carry

A knowledgeable car accident lawyer can discuss how these differences may impact your claim.

At the time of publication, Florida is a no-fault insurance state. Minimum insurance requirements in Florida are $10,000 in property damage liability coverage, which covers the damages to the other driver’s vehicle, and $10,000 in PIP insurance, which covers a percentage of your medical expenses and lost wages.

You can sue the at-fault driver for pain, suffering, and other accident-related expenses if you suffer any of the following types of injuries:

• Significant and permanent loss of an important bodily function
• Significant and permanent scarring
• Significant and permanent disfigurement
• Permanent injury

Your family can sue if the accident resulted in your death.

While Florida is currently a no-fault insurance state, there have been significant advances to change this. In 2021, Florida Governor Ron DeSantis vetoed a bill that would have repealed the no-fault insurance system. It’s important to understand both systems in case the law changes.