The primary differences between no-fault and fault insurance are the types of damages paid by the insurance company and whether the injured party has the right to sue the at-fault party for damages.
Most states are fault states, including Texas. About two dozen states have adopted no-fault insurance laws for car accidents.
In no-fault states, drivers must have a minimum amount of no-fault insurance coverage. The insurance company compensates the insured for losses incurred because of a car accident. The company pays the losses to its insured regardless of who caused the car accident.
For example, suppose a driver causes a car accident in a no-fault state. The driver would file an insurance claim with their own insurance company.
Likewise, the injured party files an insurance claim with their no-fault insurance company instead of the company for the at-fault driver. Each driver receives compensation from their respective insurance providers.
Unfortunately, most no-fault insurance policies limit coverage to medical bills, lost wages, and some incidental out-of-pocket expenses. Furthermore, some no-fault states limit the compensation for economic damages to a percentage of the total losses. Non-economic damages for pain and suffering are not covered by no-fault insurance.
Generally, an injured party cannot sue an at-fault driver for damages in a no-fault insurance state. Their only source of compensation is from their no-fault insurance provider. However, many states make exceptions for severe injuries or substantial medical expenses.
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By contrast, in an at-fault state like Texas, you can sue the driver who caused your car crash. The insurance company for the at-fault driver investigates the claim. It is responsible for paying your claim if it determines its driver caused the car crash.
However, if the insurance company does not offer a reasonable settlement amount, you can decline the settlement offer and negotiate for a higher settlement amount. If the insurance company refuses to pay the claim or pay an amount sufficient to compensate you fairly for your damages, you can sue the driver who caused the accident.
The driver’s insurance company usually will hire a lawyer to respond to the lawsuit. Many lawsuits settle before going to trial. However, some car accident lawsuits go to trial to be resolved by a jury verdict.
Because Texas is an at-fault state for car accident claims, the injured party has the burden of proving liability for damages. Most car accident claims are based on negligence. Proving negligence requires you to have evidence to convince a jury that:
Car accident cases can be complicated. It can be challenging to prove who is responsible for causing the collision, especially when the accident involves multiple parties who could be liable. Crashes that occur without eyewitnesses or video evidence can also be challenging to prove.
Therefore, our Austin car accident lawyers work diligently to gather evidence proving fault. Evidence in a car accident case includes, but is not limited to:
In some situations, we might hire accident reconstructionists and other expert witnesses to assist in the investigation. Evidence from experts can be valuable in proving fault for a disputed car accident case.
Contributory fault refers to an individual’s responsibility for causing a car accident. If a party contributed to the cause of their injury, they might not be entitled to compensation for their injury, or their compensation could be reduced.
Texas has a proportionate responsibility law that sets a 50% bar for recovering damages for a personal injury claim. If your fault for the car crash is more than 50 percent, you do not receive any money for your damages.
However, if you are 50% or less to blame, you could receive a portion of your damages. The compensation you receive is reduced by your level of fault for causing the car accident. If you are being blamed for contributing to the cause of a car crash, it is crucial to speak with an attorney before talking with an insurance adjuster or other party.
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