Fault vs. No-Fault Car Insurance

The main difference between fault vs. no-fault insurance is that no-fault insurance coverage will often cost more. In states with no-fault insurance laws, drivers are responsible for their own damages and medical bills and must carry higher levels of coverage. No matter if you live in a fault or no-fault insurance state, you can still find affordable coverage when you shop online with our free quote comparison tool below. Enter your ZIP code to get started.

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Natasha McLachlan is a writer who currently lives in Southern California. She is an alumna of California College of the Arts, where she obtained her B.A. in Writing and Literature. Her current work revolves around insurance guides and informational articles. She truly enjoys helping others learn more about everyday, practical matters through her work.

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Laura Walker graduated college with a BS in Criminal Justice with a minor in Political Science. She married her husband and began working in the family insurance business in 2005. She became a licensed agent and wrote P&C business focusing on personal lines insurance for 10 years. Laura serviced existing business and wrote new business. She now uses her insurance background to help educate...

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Reviewed by Laura Walker
Former Licensed Agent

UPDATED: Nov 12, 2020

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There are two types of car insurance, fault and no-fault. The primary difference between the two is whose insurance pays for damages to the vehicles, and how fault in the accident is handled. Which type of car insurance is used in your state is determined by the state department of insurance.

Fault insurance is the traditional type of coverage. When an accident occurs, the person who is deemed to be at fault is responsible for insurance claims. If you were not at fault and the other  driver did not have insurance, you would be responsible to pay for your own damages and injuries, and could then sue the other driver. The ability to sue the other driver is an option for anyone who feels that they did not get what they deserved.

In no-fault states, you file insurance claims with your own insurance company, and then the insurance companies of everyone involved negotiate settlements behind the scenes. There is no question of whether the other person has insurance, because your claim will be paid by your own company, insurance and they will seek restitution from the responsible parties. Under a no-fault rule, you are only able to file lawsuits against the other parties under certain circumstances, such as the loss of life.

No-fault is a little more expensive than traditional coverage, but it provides the insured person with more dependable coverage and prevents you from being left without medical care just because someone else is not paying for their own insurance.

No-fault insurance is also called PIP, or personal injury protection, because it puts the personal welfare of the insured driver first, paying for immediate medical attention and then sorting out the details of who is responsible for the accident later.

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