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16 January 2015

Car Accidents: Understanding New York’s No-Fault Insurance

In 1974, the State of New York implemented “No-Fault” insurance legislation to compensate people injured in motor vehicle accidents for their expenses and economic losses resulting from an accident. Although no-fault insurance was initially intended to simplify the compensation process for people injured in car accidents, insurance companies often make the process for filing a claim very complicated. By making mistakes during this process, car accident victims can often lose out on the money that they are owed. Additionally, victims who are seriously injured in a car accident will often be limited by the amount of compensation that they can recover under no-fault insurance. Ultimately, understanding how no-fault insurance works is important for anyone involved in a New York car accident.

No-Fault Insurance Explained

No fault insurance means that the insurance company will cover your expenses for your car accident no matter who is at fault for the accident. This type of insurance is available in 12 states, including the State of New York where it is actually required by law for all insured drivers. In other words, if you drive a car that is insured in New York then you have no-fault insurance. The good thing about no fault insurance is that you are essentially “guaranteed” coverage for your accident even if you are at fault. However there are some downsides in terms of the coverage and limitations.

What Is Covered By No-Fault Insurance In New York?

In New York, those insured under no-fault insurance are covered by what is known as mandatory personal injury protection, which compensates people for basic economic loss. Mandatory personal injury protection allows people involved in a car accident to recover:

  • Lost Earnings (Up to $2,000 per month)
  • Medical Expenses (hospital costs, service bills, prescriptions, etc.)
  • Other relevant expenses (travel, documentation, etc.)

Although no-fault insurance automatically covers the basic economic losses mentioned above, it limits each person to $50,000 of coverage for any particular accident. Additionally, it does not compensate for non-economic losses such as pain and suffering caused by a serious personal injury.

So what happens if a person suffers a serious personal injury and/or incurs expenses that exceed $50,000?

No-Fault Insurance Vs. Personal Injury Lawsuits

Sometimes the $50,000 limit is sufficient in covering the expenses incurred in a  car accident, however it can be significantly limiting in severe car accidents where there is major damage and victims suffer serious personal injuries. In the unfortunate event that an accident causes a person to suffer serious injuries and incur expenses of more than $50,000, victims have the right to file a personal injury lawsuit based on negligence.

Under a personal injury claim, an injured person is eligible to recover compensation for additional expenses. In order to file a car accident lawsuit, there needs to be another person involved in the accident whose negligence caused the accident which led to your personal injury. Additionally, a person needs to have suffered a “serious injury” as defined in section §5102 of New York ISC Law. According to section §5102, serious injury can vary from a fracture to dismemberment or death.

Applying For No-Fault Benefits

The process to apply for the benefits that you are owed under a no-fault policy can be quite complicated. Insurance providers can actually complicate the process intentionally in an effort to avoid paying out claims. Therefore, it is important to understand some of the basics when it comes to the application process aside from simply filling out the appropriate form.

Don’t Wait To Apply

In order to even be considered for compensation you will need to either file your application within 30 days of the accident or provide a written notice of your application within that time. If you do not apply within 30 days of the accident you will need to prove to the insurance company a legitimate reason for missing the deadline.

Obtain Documentation

It is also important to collect as much documentation about the accident and your injuries as possible. For example, you will want to have a record of the police report if applicable, as well as all medical records associated with the injuries you’ve sustained. Additionally, you will need to provide proof of wages from your employer in order to recover and lost wages that you may be seeking.

Contact A New York Car Accident Lawyer

The last thing you want to do after a car accident is lose out on money that you are owed. Unfortunately, many people involved in car accidents are unaware of their rights and what to do after an accident.

If you are involved in a car accident you should contact a New York car accident lawyer to discuss your options. Even if you do not believe that your expenses are more than $50,000, an experienced lawyer will be able to help you navigate the complicated application process for a no-fault claim and recover the maximum compensation for your accident.