No fault June 5, 2017

Are There No-Fault Laws in Indiana?

Indiana operates differently than other states when it comes to automobile accidents. The state deploys the comparative fault rules, which means that each person’s level of fault is considered in an accident.

All accidents are handled by the Comparative Fault Act of the state. Therefore, the fault is apportioned to the appropriate party, such as the defendant or a third party. A third party can include an employer, vehicle manufacturer, and so forth.(although because of our workers’ compensation system, a party cannot directly sue their employer for the employer’s “fault” in a civil suit) Once all sides are identified, the jury then apportions fault to the plaintiff, defendant, and any associated third party. If the plaintiff’s fault is apportioned below 50  percent, he or she can recover their damages minus the percentage of fault allocated to them.

Indiana is Not a No-Fault State

A vast majority of states now use the no-fault rule for accidents. However, Indiana is not one of them. Instead, Indiana uses the fault system of law. However, it is important that you understand what it means by “fault.”

In a state with a no-fault system, an injured driver must use his or her insurance to collect compensation, up to the limit of that policy. Then, if their costs exceed those limits, they can sue or file a claim from the at-fault driver for additional compensation.

Indiana does not operate this way. Instead, a driver who sustains an injury and damages from an auto accident can use the at-fault driver’s insurance policy to collect compensation for those injuries, lost wages, and property damage, and then in some situations  turn to their own insurance for uninsured or underinsured motorist benefits– which are very important to purchase!

The Tort System of Indiana

There is a tort system in Indiana that helps determine fault. When a person is apportioned their level of fault, their insurance company pays for their damages and the costs of the non-fault victim — up to the policy limits.

Therefore, Indiana requires that drivers carry a minimum level of insurance in the event they are in an accident. Naturally, a driver would want to purchase more than the minimum, because these minimums are substantially lower than most accident compensation settlement needs.

The minimums include:

  • $25,000 for Bodily Injury Liability
  • $50,000 for Bodily Injury Liability per Accident
  • $10,000 for Property Damage
  • $50,000 Uninsured Motorist Coverage

Naturally, a single injury or accident case might exceed $50,000. Therefore, if the driver does not have more than $50,000 in coverage, the driver’s personal assets (those solely in the individual’s name, and without loan encumbrances)  would pay for the excess. It is rare to find a situation where assets are truly collectible from an individual, so uninsured and underinsured coverage of at least  100,000 or 300,000 is an important and highly recommended purchase!

Misconceptions about PIP Insurance– and Indiana’s “Sort-Of” equivalent

Just because Indiana is a fault state does not mean you cannot purchase PIP insurance. PIP is an insurance plan required by no-fault states. If you have PIP insurance, your insurer would pay for medical payments up to a particular value before you collect from the other party’s insurance.  in Indiana, there is a type of coverage- known as medical payments benefits= that operates similar to PIP.  with this coverage– usually in the limited amounts of 1,000, ,5000, or 10,000, coverage is provided for medical treatment for you and  the occupants of your car, even is an accident is your fault. This coverage is especially beneficial to cover health insurance deductibles, and copays, or even as a primary source of payment when no health insurance is not available.

Injured in an Accident? Contact a Personal Injury Attorney

If you or a loved one was injured in an accident, you might be entitled to compensation. To explore your options, speak with an advocate from Jacobs Law, LLC today. Schedule a free consultation by contacting our office directly or by sending us a message online.