What Is No-Fault Insurance?
No-fault insurance covers medical expenses for victims of auto accidents, regardless of blame.
Personal Injury Protection (PIP) and First Party Benefits are both types of no-fault insurance.
No-Fault Insurance Has One Purpose:
To provide victims of auto accidents access to medical care, without having to worry about the bills.*
No-Fault Insurance Has Two Parts:
- Coverage for medical treatment from hospitals and other medical providers
- Reimbursement for other expenses like lost wages and costs to hire someone to take care of your home or family.
No-Fault Insurance Covers:
- You, if you have a personal auto policy;
- Any family member who lives in your household; and
- Any passenger in your car who doesn't have coverage through another policy.
Usually, no-fault insurance does not cover people using a vehicle for business or transporting people for hire. It has other exclusions, too, which you can find in your personal auto policy.
Choosing a Coverage Limit
Most no-fault states require drivers to maintain a minimum amount of no-fault medical coverage. You can purchase higher limits than required by state law.
When choosing your coverage limits, consider:
- The cost of medical care in your state;
- The cost of a hospital stay, rehabilitation, and further treatment;
- Your lost wages if you can't work while you recover; and
- The cost to hire someone to care for your house and family, if needed.
PIP has a deductible and co-payment.