Can You Sue With No Fault Insurance?

No fault insurance laws exist in several states across the US. These laws are designed to simplify the claims process after an auto accident. However, many people wonder if you can still sue with no fault insurance in place. Below is an in-depth look at how no fault insurance works, when you can sue, and steps to take if you want to file a lawsuit after an accident in a no fault state.

What is No Fault Insurance?

No fault insurance is a type of car insurance policy required in 12 states. It is designed to lower the number of lawsuits between drivers after an accident.

With a traditional auto insurance policy, when an accident occurs, insurance companies investigate to determine who was at fault. The at-fault driver’s insurance typically covers injuries and damages for other parties.

No fault insurance skips this investigation in most cases. Instead, each driver makes an injury claim through their own insurance company, regardless of fault.

There are a few key features of no fault insurance laws:

• Required Personal Injury Protection (PIP) – The minimum PIP coverage varies by state, but helps pay for medical treatment and sometimes lost wages.

• Limited Right to Sue – Drivers usually cannot sue except for serious injuries or when medical costs exceed the minimum PIP limit.

• Property Damage Liability – At-fault drivers are still responsible for repair costs to other vehicles.

No fault insurance aims to lower disputes between insurance companies. It also ensures prompt payment for medical expenses after an accident.

When Can You Sue with No Fault Insurance?

No fault insurance severely limits the ability to sue after a car accident. However, there are some exceptions that still allow injured parties to take legal action.

The main instances when you can sue with no fault insurance include:

1. Serious Injuries

Most no fault states allow lawsuits if injuries meet a specified severity threshold. For example, in Michigan you can sue for pain and suffering if injuries are “serious” based on objective medical evidence.

Other common injury thresholds to sue include death, permanent disfigurement, loss of a body part, or a serious impact on body function.

2. Exceeding PIP Limits

No fault insurance policies include a minimum PIP limit that varies by state. If your medical costs exceed this limit, you may be able to sue the at-fault driver for the excess amount.

For example, if the PIP limit is $50,000 in your state and your medical bills are $70,000, you may be able to recover the extra $20,000 by filing a lawsuit.

3. Exceptions for Property Damage

Drivers must still hold property damage liability coverage in no fault states. This allows owners of damaged vehicles to pursue compensation for repair or replacement costs through an insurance claim or lawsuit.

4. Out-of-State Drivers

No fault insurance rules typically only apply to drivers who are residents of the no fault state. Visitors from other states are not subject to the same limitations on lawsuits.

So if you are injured by an out-of-state driver in a no fault insurance state, you may be able to take legal action even if your injuries do not meet the threshold.

Steps to Take if You Want to Sue in a No Fault State

If your injuries and damages meet one of the exceptions above, you may decide to pursue compensation by filing a lawsuit. Here are some steps to take if you want to sue with no fault insurance:

1. Speak with a personal injury attorney – An experienced lawyer can examine the details of your case and advise if you have grounds to sue. They can also walk you through the process.

2. Collect evidence – Gather police reports, medical records, bills, photos of property damage, and other documentation. Eyewitness statements are also helpful.

3. Send a demand letter – Have your attorney send a letter to the at-fault driver requesting compensation for your damages. This may prompt their insurance company to offer a fair settlement.

4. File the lawsuit – If a reasonable settlement is not reached, your lawyer can file a personal injury lawsuit in civil court.

5. Engage in discovery – During discovery, your attorney can request additional evidence from the defendant to build your case.

6. Reach a settlement or proceed to trial – Many cases settle out of court once the evidence is clear. If not, your case can go to trial where a judge or jury will decide the outcome.

Typical Defenses in No Fault Lawsuits

Insurance companies often fight no fault lawsuits aggressively. Some common defenses you may encounter include:

• Claiming you do not meet the injury threshold to sue.
• Disputing the nature or extent of your injuries.
• Alleging comparative negligence – arguing you were partially at fault.
• Asserting the statute of limitations has expired.
• Disputing the amount of economic and non-economic damages requested.

An experienced personal injury lawyer can anticipate these arguments and build a strong case on your behalf.

No Fault Car Accident Case Results

Despite strict limitations, some no fault cases do ultimately result in favorable verdicts and settlements for plaintiffs. For example:

• A woman severely injured in a Michigan auto accident received a $1.2 million settlement after suing the at-fault driver.

• A Florida plaintiff was awarded over $830,000 by a jury after his PIP benefits were exhausted and injuries exceeded the tort threshold.

• An Illinois court upheld a $3.5 million jury verdict for a plaintiff who suffered severe facial scarring in a car crash.

• A man injured by an uninsured, out-of-state driver in Michigan received a $425,000 settlement.

Outcomes vary case-by-case based on state laws, unique case facts, quality of evidence, and legal expertise. But these examples demonstrate it is possible to achieve justice with no fault insurance.

Alternatives to Lawsuits in No Fault States

Filing a lawsuit is not the only option after a serious accident. Other potential approaches include:

• Settlement negotiations – Your attorney may be able to negotiate a fair settlement with the insurance company without litigation.

• Insurance claims – Make a claim through your own policy for PIP benefits, underinsured/uninsured motorist coverage, and other compensation you may be entitled to.

• Arbitration – Some states allow binding arbitration to resolve no fault disputes as an alternative to court.

• Mediation – You and the defendant may be able to reach a settlement through guided mediation and avoid a trial.

While a lawsuit is sometimes necessary, it is wise to explore other alternatives that may provide compensation faster and with less legal costs.

Key Takeaways

• No fault insurance aims to reduce lawsuits between drivers after auto accidents.

• Seriously injured victims can typically still sue for pain and suffering damages.

• Exceeding PIP limits, property damage claims, and out-of-state drivers also allow lawsuits.

• An attorney can advise if you have grounds to sue and guide you through the process.

• Strong evidence and legal expertise are essential to overcoming insurer defenses.

• Alternatives like settlements and arbitration may also provide compensation without lengthy litigation.

No fault insurance makes obtaining full compensation challenging. But with the right lawyer, many victims are still able to recover damages by filing a personal injury lawsuit or reaching a favorable settlement.