no-fault insurance


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no-fault insurance,

type of indemnity plan, usually applied to automobile coverage, in which those injured in an accident receive direct payment from the company with which they themselves are insured. Originated (1947) in Saskatchewan, Canada, no-fault insurance eliminates the need for accident victims to establish another's liability, or fault, through a civil lawsuit. Lawyers' groups oppose no-fault, saying that it limits the citizen's right to sue. Supporters say that it leads to quicker settlement of accident claims and lower premium rates than the traditional tort liability system because it reduces legal fees and court costs. The first comprehensive no-fault plan in the United States was adopted (1971) in Massachusetts. Currently 13 states have no-fault auto insurance laws that in some way restrict the right of parties to file legal suits. Provisions defining when a person can sue in no-fault states vary, but motorists can generally sue for severe injuries. Recently, however, rising insurance costs have led some states to reexamine the effectiveness of no-fault insurance laws.
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Control of medical service corporations by unlicensed individuals leads to higher costs, less effective medical treatment, and mistrust of the no-fault insurance system.
At the present, only 12 states mandate no-fault insurance: Delaware, Florida, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New York, North Dakota, Oregon, Utah, and Texas.
At least as interesting an alternative, not under active discussion, is private no-fault insurance. A hospital with an effective quality-assurance program could offer no-fault insurance to its patients for a reasonable premium, with an even lower premium for patients who agreed to forego filing a tort claim in the event of an injury.
For example, if the lessee signs a lease with the lessor that requires $100,000/$300,000/$25,000 policy limits, but for some reason, the insurance is not collectible when an accident occurs, CA 20 09 provides liability coverage and any required no-fault insurance. This protects the lessor in case it is sued as the owner of the car involved in the accident and as the "deep pocket" for coverage because the lessee has no insurance money available for the claimants.
The insurers accuse the defendants of establishing a insurance fraud network to take advantage of New York's no-fault insurance law, which guarantees persons hurt in automobile accidents up to $50,000.
NEW ORLEANS -- A complete overhaul of the medical justice system and a no-fault insurance plan were among the possible solutions to the medical liability insurance crisis suggested by speakers at the annual meeting of the American College of Obstetricians and Gynecologists.
Colorado's no-fault insurance law has undergone 10 major revisions since 1974.
This is precisely what many states had in mind when they adopted no-fault insurance legislation in the 1970s.
Fifteen states worked out legislation along those lines and created no-fault insurance. If a driver is in an accident, her insurance company pays her bills.
The other, Pay-at-the-Pump No-Fault Insurance (PPN for short), is now being pushed by a guerilla band of consumer advocates in California.
The largest first-year savings projection of $9.2 billion assumes that 60% of liability costs above premiums result from defensive medicine and that no-fault insurance would reduce the total by 85%.
reform auto insurance continue, the pay-at-the-pump concept - whereby consumers would no longer pay for basic no-fault insurance but instead would be assessed a tax on gasoline - may gain momentum.