For a long time, courts were flooded with cases concerning automobile accidents. This glut clogged the system and led to several detrimental consequences. These included delayed medical coverage reimbursement, sometimes for many months, or even for years in some cases. A specialty practice for accident lawyers thrives because of this unfortunate situation. The idea behind no fault insurance coverage was to make it a form of tort-reform. Tort systems depend upon proving negligence, which takes time. The desired result of no-fault provisions is to expedite insurance payment claims.
These systems have a number of advantages:
- All parties are covered, no matter who is at fault. The good drivers benefit because they don't have to wait to receive the money due them. It's frustrating enough to deal with an accident, but even worse to have to fight out a case in court.
- No trials mean less time to receive insurance reimbursement.
- Lawsuits are limited to extreme reasons, such as for disabling injuries or fatalities.
Twelve states have no fault insurance systems:
- New Jersey
- New York
- North Dakota
Even with the advantages, some people are not convinced that no-fault is the way to go. Those in the industry worry that it has led to an increase in insurance fraud scams in the states where it is practiced. Lawyers have found a new opportunity due to an increase in personal injury claims. This litigation has led to higher St Paul auto insurance premiums. It seems that some problems have been traded off for a new set of consequences. There are other disadvantages that affect consumers:
- Property damage is not covered, which means parties involved in an accident are open to lawsuits if their vehicles damage buildings, fences, lawns, or other property owned by a third party.
- Policies only cover up to a set amount of medical coverage. If this is exceeded, then a lawsuit is still necessary to recoup additional amounts.
- There are no provisions for any inconvenience the driver has experienced, or for any emotional suffering or physical pain.
- Bad drivers are not punished for their negligence.
Even laws in no-fault states can be quite different from each other. For instance, Michigan has a system where payments are determined based on an order of priority which is more complicated then it sounds.
If you need some more guidance concerning no-fault insurance guidelines in Minnesota, give Lancette Agency a call at 651-264-1230. It's a complex issue, but information is available to ensure understanding.