Getting auto insurance can be a long and demanding process, especially if you are new at it. If you want to be sure that you are in fact getting the best deal for your money, you need to be sure that you are opting for coverage that you can afford and also one that can work for you during the time for claims. This might be difficult to find immediately, but then, you will eventually stumble upon it when all the options are clear to you.
Some states in the USA, 38 to be precise, mandate by law that the car drivers should go in for fault based insurance. This simply means that you should opt for coverage that is going to pay for you as well as for the other party, if the accident was caused due to a fault of yours. In such cases, you are expected to report the accident at once to your insurance company and ensure that they have released the money that you can sue to pay the other party with. This is the more expensive option, but there is nothing much that you can do about it if it is required by the law.
On the other hand, a no fault policy works in such a way that you need to just pay for yourself and it is the same for the other party involved in the accident as well, regardless of who might be at fault. This is something that you might be using, as most people would go in for this policy unless they have been forced to opt for a fault based coverage by the law. It is cheaper, and one can even add a lot of features to it without having to worry too much about the costs of being insured.
Fault based and no fault based policies are just one of the ways that you can use to distinguish the policies. There are other ways as well that you can use to differentiate the policies and it is not essential that you use only these parameters to identify the policies. Remember that lots of other features like collision coverage, comprehensive coverage, liabilities and other such things also constitute an auto insurance policy. Consequently, take your time and decide only on the one that is going to work for you based on all of these parameters; not just what you see in the bigger picture.