New York No-Fault: An Introduction

New York state’s No-fault law came into existence during the 1970’s as a means to expedite claim payments tied to motor vehicle accidents. Including both medical and wage replacement coverage, this legislation spared parties from having to navigate the court system through litigation, providing some relief to an already overburdened court system through the utilization of arbitration through the American Arbitration Association.

No-fault legislation applies to any driver, motorcyclist, passenger, or pedestrian that is injured by a motor vehicle within the state of New York. In the instance of a driver or passenger, the injured party should be present within the insured vehicle. In the cases of a cyclist or pedestrian, the injured party would have been struck or come into contact with the insured vehicle. In order for a vehicle to be covered by no-fault coverage the vehicle must be registered with New York State and must be covered by an insurance carrier that is licensed to sell coverage in New York State. While No-Fault coverage is expansive it would not cover motorcyclists, motorized scooters, or injuries that resulted from an accident tied to the consumption of alcohol. Injuries that take place while during the course of employment will also likely not be covered by no-fault.

No-fault coverage is included in insurance plans for applicable New York State registered vehicles and is often referred to as Personal Injury Protection, or PIP, by insurers. This coverage provides each eligible, affected individual with up to $50,000 in benefits; these benefits are comprised of payments for medical expenses and the reimbursement of lost wages. Carriers will often offer insureds the opportunity to purchase additional coverage beyond those statutorily mandated. This coverage, often referred to as Additional Personal Injury Protection, or APIP, could potentially double the amount of protection available for an eligible party subject to no-fault law.

With regards to the payment of a claim, a carrier will typically continue to pay benefits until policy maximums are met so long as services are deemed medically necessary or coverage is not otherwise denied, typically as a result of a policy violation.

At its heart No-Fault coverage is designed to protect motorists and their loved ones, affording them peace of mind in what would otherwise be an incredibly stressful situation.