Legal liability insurance requires every driver to file a claim with their own insurance company after an accident, regardless of who was guilty. What is no fault car insurance?
Car insurance without fault
Car insurance without a fault requires each driver to file a claim for personal injury and medical expenses after an accident, regardless of who is to blame. The purpose of insurance without fault is to limit the number of lawsuits in the Small Claims Court, which may slow down the recovery process.
Theoretically, no guilt insurance makes sense. In practice, this can lead to high premiums, fraud and inconvenience to both insurance companies and drivers.
In the broadest sense, no guilt insurance is any type of insurance contract under which the insured is insured by his own insurance company for losses, regardless of the source of the damage. In this sense, it is no different from your own reach. The term “no fault” is most commonly used in the context of state or regional motor insurance regulations in the United States, Canada and Australia, where the policyholder and its passengers receive reimbursement from their own insurance company without proof of guilt, and have limited right to seek compensation for through the civil justice system for damages caused by other parties. The purpose of insurance without fault is to reduce premium costs by avoiding costly disputes regarding the causes of the collision, while ensuring quick payments for injuries or loss of property.
Variants of approach without flaws
In the early 1990s, the concept of pure lack of guilt, which prohibits most lawsuits regarding personal injury, began to gain support. A clear, error-free response to several social concerns: waste of resources and inequalities in the liability system, and the need for affordable medical and rehabilitation costs. The first attempt to create a clean system without defects was “pay-at-the-pump”, a payment plan for auto-insurance without defects through a fee charged on the sale of gasoline. The pay-at-the-pump campaign was unsuccessful in all states in which the plan was considered, including California, due to opposition to the gasoline charge, but the pure idea did not contain errors legislative proposals in different states, in Hawaii and California. Congress’ proposals for a ‘clean’, faultless car insurance system never got a say in the vote.
Does the fault insurance cover no damage to the car?
Although your liability insurance covers economic losses, damage to your vehicle would be covered by collision insurance or another driver’s liability policy – rather than guilt insurance.