What Is No-Fault Car Insurance And How It Works In Ontario? – ListDen

Have you ever been in a car accident? Do you know how the car accident insurance system operates in your region? In today’s fast-paced life, vehicle accidents are on the rise. The people involved in car accidents not only suffer the physical and mental trauma but also have to deal with financial expenditures such as medical bills and car repair cost. The whole situation becomes even more troublesome when the drivers are not aware of the insurance rules of their province. So, if you live in Ontario, in this post you’ll get to know about the no-fault insurance system that operates in this Canadian province.

For people living in a “no-fault” insurance province, it’s imperative to know what exactly no-fault car insurance coverage means. Several jurisdictions follow some version of a “no-fault” car insurance system such as New York, Massachusetts, Michigan, New Jersey, Florida, and many more. However, the rules followed in each state may slightly differ. No matter in which “no-fault” insurance state you live, it’s crucial to have a basic understanding of this system. So, here we’ll first understand what no-fault insurance means and then move to how it works.

What is No-Fault Insurance?

Possibly, like many other people you also think that the term “no-fault” means that in the event of a car accident, nobody is at fault. This is a common misconception about no-fault insurance.  No-fault insurance is a type of auto insurance that allows people to get reimbursed in case of the accident regardless of the party at fault. A no-fault insurance claim, sometimes also called a personal injury protection claim, intends to save on expensive litigation costs that can occur when two parties are trying to prove fault on the other party. This means your medical costs will be covered in the event of a car accident, regardless of who is at fault.

This system came into existence because earlier the process was costly and time-consuming. Back in the 1980s, first the party responsible for the accident was determined. Once the insurance companies determine who was at fault, the provider of the responsible party will pay out the claims of the injured party. This process used to take a lot of time and prevented involved parties from receiving prompt medical assistance. Now, no-fault insurance has made the process faster because there is no question about who will pay the claim. If you’re injured in a car accident, your own car insurance coverage will pay some or all of your medical bills and lost earnings.

How Does No-Fault Insurance Work?

Unlike the common misconception, Ontario’s no-fault insurance system doesn’t imply that nobody is held responsible for a car accident or there won’t be any legal action taken against those who have been found in violation of the law. No-fault insurance system simply means that in the event of a collision, the involved parties will receive individual claims through their own insurance companies. The entire purpose of this system is to make the process faster and easier by prioritizing the claims process for drivers who need prompt reimbursement. As far as determining the fault is concerned, the concerned insurance companies will investigate the case. The investigation process is based on the Fault Determination Rules which are regulations laid out by the Ontario’s Insurance Act.

The insurance companies determine who was at-fault in an accident and assign fault from zero to 100 percent to each driver. Your fault in an accident can impact future premium rates. The at fault party in an accident may have to pay the collision deductible. If it is determined that you are not at-fault, your base insurance rates will not increase. Then there is the issue of liability which is a separate issue and will affect the prospect of the third party claim against the responsible driver and others. All of the above is separate from charges drivers may face under the highway traffic rules of the jurisdiction. To help navigate these and other issues in the event of a car accident, an experienced personal injury should be best to help from as early as possible after the accident.

 

Share:

Facebook
Twitter
Pinterest
LinkedIn

Leave a Reply

Your email address will not be published. Required fields are marked *