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No fault insurance in general is a term used
to describe an
auto insurance
system that requires drivers to carry insurance for
their own protection and
places limitations on their
ability to sue other drivers for damages.
In a pure no fault system, drivers would be completely covered by their own policy, and
would be barred from suing another driver for damages.
If you have an
accident, under pure no fault laws, your auto insurance company will pay for
your damages (up to your policy limits), regardless of who was at fault.
Other drivers involved would be covered by their
auto insurance.
Since no state is pure no fault, drivers can be held financially responsible
for
the cost of injuries they cause in certain circumstances.
States actually use parts of both
the no fault system and the standard liability system (under which you're financially
responsible for the cost of damages you cause).
Some no fault states allow injured parties to sue if their injuries meet certain standard
for severity, while others allow it when total costs reach a certain dollar level.
Always contact the State Insurance Commission Office you live in to find out
about your state insurance liability requirements.
That's
why liability insurance
is still so important,
and why and every no fault state requires it.
Brief history of the No-Fault concept
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