Every state has different laws dictating how fault is determined in a car crash, who is eligible for compensation, how much compensation they can get, and even how compensation is paid out. New York is a no-fault state for auto accidents.
What Does No-Fault Mean?
In “fault” states, the person who is found to be at fault for a car crash is responsible for paying the medical bills (through their insurance coverage) of those involved in the accident, including themselves and the person (or people) they hit.
By contrast, in “no fault” states like New York, both drivers get compensation through their own coverage, regardless of who was at fault.
Because of this, people involved in car accidents in fault states are usually not allowed to sue the other driver for damages.
However, it also means that injured car accident victims can usually get compensation faster, since the insurance companies of both drivers don’t need to waste time arguing over who was at fault and who has to pay.
What’s the Difference Between No-Fault and PIP?
No-fault refers to the laws surrounding insurance claims, while Personal Injury Protection (PIP) is the name of the type of insurance coverage you buy in no-fault states to protect you in case of a collision.
The two terms are often treated interchangeably because PIP insurance is currently required for all vehicle owners in all states that use a no-fault system.
What Does First-Party Coverage Mean?
PIP is a type of first-party coverage, meaning it’s coverage for the person named on the insurance policy and not anyone else (for example, the other driver in a collision).
Other types of first-party coverage include medical payment coverage through an auto insurance policy, and uninsured/underinsured motorist coverage.
When you pursue compensation from someone else’s insurance coverage, that’s called third-party coverage.
Does PIP Cover Passengers?
Yes, if you were a passenger in a car accident in New York and were injured, you could get compensation for your medical bills through the PIP insurance coverage of the person who was driving the car you were riding in, even if they weren’t at fault for the accident.
What Does PIP Cover in New York?
The coverage a policyholder has depends on the extent of their policy. After a car accident in New York, your PIP policy will typically cover:
- Your medical expenses
- Partial wage compensation, if you are unable to work while recovering from your injuries
- Allowance for some “reasonable and necessary” accident-related expenses, such as childcare while you are hospitalized or transportation costs while you are unable to drive
- Death benefits to your family, in case of a fatal accident
Are There Exceptions to No-Fault in New York?
Yes, for starters, PIP only applies to medical expenses. If you are in a car accident with no injuries, but your vehicle is damaged, fault still comes into play when determining which insurance company will pay for your vehicle repairs. Compensation for your property damage will come from the at-fault driver’s collision insurance.
Secondly, you can still sue the other driver directly if you suffered serious injuries as a result of their negligence. However, you must first meet New York’s “serious injury threshold,” which decides whether your injury is serious enough to bypass PIP.
New York defines a serious injury as one that results in:
- Significant disfigurement
- Loss of a fetus
- Permanent loss of use of a body organ, member, function, or system
- Permanent consequential limitation of use of a body organ or member
- Significant limitation of a body function or system
- A non-permanent injury that prevents the injured person from performing most of the actions forming their daily routine for a minimum of 90 days within the 180 days after their accident
- More than $50,000 in medical payments
Finally, you may also be ineligible for PIP benefits if you were at fault and caused an accident because you were driving under the influence of drugs or alcohol.
Suffered a Serious Injury? Contact Our Team
While the no-fault system is designed to bring relief to injured victims of accidents faster, it isn’t designed to help victims of serious injuries who can’t get the compensation they need through PIP alone.