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New York’s No-Fault System

The state of New York is one of a few states around the country that operates a “no-fault” insurance system concerning vehicle accidents. This means that insured individuals will typically receive reimbursement after an accident from their insurance carrier, regardless of which party caused the incident. Here, we want to examine what the New York no-fault law means for you.

A No-Fault System – There Are Benefits and Drawbacks

No-fault insurance, commonly referred to as Personal Injury Protection (PIP), can help quickly pay for economic losses resulting from a vehicle accident, regardless of which party caused the incident or whether there was any negligence at all. Basic no-fault coverage is $50,000 per person, including the driver and all passengers who sustain injuries in the vehicle and any pedestrians injured by the car accident.

The main benefit of the no-fault insurance system in New York is that individuals can typically recover compensation much quicker than they would otherwise be able to if they had to establish negligence to recover compensation from an at-fault party. This type of system also helps individuals recover the compensation they need even if they made a mistake and did happen to cause the accident.

However, no-fault insurance only pays up to the insurance policy amounts, and individuals cannot recover compensation for pain and suffering damages. Under this type of insurance system, crash victims are typically prohibited from filing a claim directly against an at-fault party. However, there are some caveats, including the serious injury threshold.

The “Serious Injury” Threshold Explained

In New York, the no-fault insurance system is designed to streamline the process of compensating losses from auto accidents, regardless of fault. However, this system has specific criteria for stepping outside its bounds to seek further compensation. This is known as the “serious injury” threshold, as defined in the Insurance Law, which must be met to pursue a lawsuit for more immeasurable non-economic losses, such as pain and suffering, outside of the no-fault system.

Key Elements of the Serious Injury Threshold:

  1. Definition of Serious Injury. Under Insurance Law § 5102(d), a “serious injury” is defined as one resulting “in death, dismemberment, significant disfigurement, fracture, loss of a fetus, permanent loss of use of a body organ or member,” marked limitation of use of a body function or system, or an injury preventing the person from performing their typical activities for not less than 90 days during the 180 days immediately following the injury.
  2. Recovery Limitations. Insurance Law § 5104 shows that a person can only sue for non-economic loss in the case of a serious injury. Additionally, the recovery under an automobile liability policy for serious injury is subject to policy limits. For instance, if an insurer agrees to pay the maximum under a policy for a serious injury such as the loss of a fetus, any other serious injuries arising from the same accident would not be additionally covered under the same policy.
  3. Wrongful Death Consideration. In cases where a child is born alive but then dies shortly after as a result of an accident, a wrongful death action can be pursued on behalf of the decedent. The representative may seek damages, with recovery subject to the policy limit for the death of one person.

Contact an Attorney for Help After a Vehicle Accident

Suppose you or somebody you care about has been injured in a car accident and are confused about how you will recover compensation. In that case, we encourage you to contact a lawyer today. A Buffalo car accident attorney can examine every aspect of your claim and walk you through the processes needed to recover monetary compensation.