While most states operate their insurance policies based on the conventional fault-based auto insurance policies, there are other states that follow a no-fault auto insurance system. This coverage is also better known as PIP and it is being followed in states like New York, Michigan, Florida, Kansas, Minnesota, Massachusetts, Kentucky, Hawaii, New Jersey, Washington D.C., and Pennsylvania etc.
As per the no-fault coverage each policyholder can recover their financial losses from their respective insurance company regardless of who was at fault. This type of coverage was set up in order to remove the fault out of the liability and in order to cover medical costs from their own insurance providers. This was one way of avoiding ugly court battles where one has to prove the fault. This was also a good option for those individuals who were not covered by health insurance.
These states have limited tort, and there are restrictions on the right to sue in the event of an accident. Under this no-fault system, the insurance provider will pay for damages irrespective of who was at fault but only up to the specified limit. This payment is guaranteed and in exchange for this you will be expected to forego some of your rights to sue the opposite party when involved in a crash. You will also be protected in case you are at fault. Hence the benefits work both ways.
The medical benefits as well as the monetary limits will vary largely from one insurance provider to another depending on the state you purchase your policy. Auto insurance fraud is a constant problem in states where the PIP benefits are much higher. In such states, fraud rings operate on a large scale and this causes the no-fault auto insurance rates to go up.
The second highest auto insurance premiums are paid by the New Yorkers. The no-fault auto insurance policy could be expensive due to some of the liability issues. Although there are no policies that can offer prevention from all lawsuits or policies that can cover all the costs, this coverage offers some basic protection.
Although the no-fault auto insurance rates are among the highest you can obtain cheap no-fault auto insurance quotes online. The best way to do it is to go to a website which offers multiple quotes from all the major auto insurance providers. Then choose the option that is best suited for your needs after comparing the quotes and the various features.
