No Fault Law Law & Legal Definition
No-fault, in a strict application, would entirely eliminate any concept of fault from the civil tort system when dealing with car accident claims. It would also deny any claim by the victim for non-economic losses, including physical and mental pain and suffering, permanent impairment, and disfigurement. Economic losses such as medical bills and lost income would be paid by a person's own automobile insurance.
This type of law favors the insurance industry, because it would increase profits by both substantially increasing premiums and by eliminating a major component of fair compensation for victims of automobile accidents, namely, recovery for non-economic losses. Fortunately for drivers, no state has adopted a pure no-fault system for car accident claims, and several have specifically rejected such proposals. Rather, several states have adopted modifications of pure no-fault. In some states, a party's own insurance pays for medical and lost income expenses, and the victim cannot make a claim against the negligent driver for non-economic damages unless and until a threshold has been reached of a specific dollar amount.
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