No, no-fault insurance will not pay for your car repairs after an accident. Even in no-fault states, the at-fault driver is responsible for paying for vehicle repairs after an accident, as no-fault rules do not apply to property damage. No-fault states simply require drivers to use their own personal injury protection (PIP) insurance to pay for their medical expenses after a wreck.
As a result, if the other driver is at-fault in an accident that damages your car, requiring repairs, then you need to file a property damage claim through their insurance company. But if you caused the accident, then you need to file a claim with your own collision coverage.
The no-fault states for car insurance are Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania, and Utah. In the 12 no-fault insurance states, each driver’s car insurance provider pays their own medical claims after an accident regardless of who was at fault.
A no-fault insurance system limits the ability of drivers and passengers to sue for additional compensation. Drivers in no-fault states can sue for injuries only if they are determined to be “severe” – the legal definition of which varies from state to state. No-fault rules only apply to injuries, however. Property damage claims in no-fault states are still paid by the at-fault driver’s liability insurance.
Of the 12 “pure” no-fault states, New Jersey, Pennsylvania and Kentucky are the only ones that give drivers an option to choose between buying a no-fault insurance policy and a traditional auto liability insurance policy.
Besides the 12 no-fault states, some “add-on” states have auto liability insurance laws that are a blend of the no-fault and at-fault insurance systems. These add-on states, such as Virginia and Texas, are not considered to be true no-fault states by the Insurance Information Institute because they do not restrict or place limits on a driver’s right to sue for additional compensation.
Finally, at-fault states follow a tort system, which assigns responsibility for an accident to a driver or drivers. At-fault states also allow injured parties to sue negligent drivers for injuries, as well as pain and suffering, without restrictions. Most U.S. states are at-fault states.
Insurance Rates in No-Fault States
Drivers who live in one of the 12 no-fault insurance states can expect to pay more for auto insurance than those in at-fault states. Insurance fraud is more common in no-fault states, given that claims are paid regardless of who was at fault, providing an incentive for some individuals to exaggerate the extent of their injuries. Those heightened rates of fraud, combined with mandatory PIP insurance, raise costs for auto insurers, which are passed on to consumers.
It should be no surprise that the three most expensive states in WalletHub’s Cheap Car Insurance Study – Michigan, New York, and New Jersey – are all no-fault states. So if you live in a no-fault state or will be moving to one, be sure to compare quotes so that you can get an auto insurance policy that fits your needs and your budget.
No, traditional car insurance does not cover ordinary repairs or maintenance to your car. If your car is covered by comprehensive insurance, your insurance company will cover mechanical repairs caused by a car accident, natural disasters, or other unforeseeable events.
Insurance companies do offer a type of coverage that policy holders can use for repairs. This coverage is called … read full answermechanical breakdown insurance (MBI), or repair insurance. MBI is offered by some insurance companies and comes with a deductible. MBI deductibles tend to be low, and in the event your car needs major mechanical repairs, this type of coverage could save you thousands of dollars. It usually covers repairs to your vehicle’s engine, drivetrain, transmission, brakes, exhaust and power system.
With many policies, MBI coverage cannot be used for car maintenance, or for tire replacement, coolant replacement or other minor repairs. It’s also important to keep in mind that some insurance companies that offer MBI only do so for newer models and vehicles under a certain mileage.
If you’re considering purchasing MBI coverage, it’s a good idea to carefully read the provider’s policy in order to understand required qualifications for and limitations of the offered coverage.
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