Insurance Westchester NY

What Is No-Fault Insurance?

It’s a fact of life that our homes, cars, and even our lives need to be insured for losses due to an injury, accident, fire, or death. Insurance helps us or our surviving family members to live with some stability after a life-altering event; it pays out funds to cover repairs, living costs, funeral expenses, and other things. According to the Insurance Information Institute (III), “The term ‘no-fault’ auto insurance is often used loosely to denote any auto insurance program that allows policyholders to recover financial losses from their own insurance company, regardless of fault. But in its strictest form no-fault applies only to state laws that both provide for the payment of no-fault first-party benefits and restrict the right to sue, the so-called ‘limited tort’ option. The first-party (policyholder) benefit coverage is known as personal injury protection (PIP).”

Currently, twelve states and Puerto Rico have no-fault auto insurance laws. The others are:

  • Florida
  • Michigan
  • New Jersey
  • New York
  • Pennsylvania
  • Hawaii
  • Kansas
  • Kentucky
  • Massachusetts
  • Minnesota
  • North Dakota
  • Utah

In New Jersey, Pennsylvania and Kentucky, motorists may reject the lawsuit threshold and retain the right to sue for any auto-related injury.

No Fault in New York

In his 2014-15 executive budget, New York State Governor Andrew Cuomo said he would expand the New York Financial Services’ ability to audit healthcare providers participating in the no-fault auto insurance system to prevent fraudulent insurance providers from receiving payment and fining providers who engage in illegal activities. The department will be authorized to make unannounced inspections. Insurers are also pushing for legislation that accomplishes the following: makes staged accidents a felony; ends fraudulent billing by fly-by-night durable medical equipment providers; permits retroactive cancellation of fraudulently obtained auto insurance policies; and requires medical care providers to prove that a prescribed treatment is medically necessary, according to the New York Insurance Association and Insurance Journal.

The Cuomo administration has already taken steps to curb insurance fraud. In February 2013, the New York State Department of Financial Services adopted three amendments to Regulation 68, the law that implements the state’s no-fault law claim settlement procedures. The first amendment would prevent billing for services that were not provided or billing more for services than the established fee. The second amendment would set a deadline for health care providers to respond to requests for verification that the treatment provided was medically necessary. The third amendment would prevent immaterial paperwork errors from invalidating a denial of a claim or a request for verification. This last amendment should substantially reduce litigation and arbitration dealing with claim processing errors and speed up the resolution of no-fault claims, the department says.

No Fuss Insurance

Luis Guerra has been in the insurance business for more than twenty years. He has the experience with the industry and the commitment to his customers’ complete satisfaction that you have been looking for in an insurance agent. With a dedicated staff working to support him, you can bet that no one will work harder than the team at Luis Guerra Agency LLC.