Fault vs. No-Fault Insurance in Personal Injury Cases

You may know Colorado is an "at fault" state, but are you aware that this designation affects everything from how insurance claims are processed to how much compensation you can recover from your injuries?

When it comes to personal injuries, understanding the law is critical—which is why we're breaking down exactly what this means for Colorado drivers and personal injury victims.

At-Fault, No-Fault Insurance Coverage: What’s the Difference?

To understand the difference between at-fault and no-fault insurance coverage, consider how an auto claim would be handled in an at-fault state like Colorado versus a no-fault state.

In Colorado, the driver who caused the accident is responsible for paying damages. Because of this, the injured parties must prove negligence to receive compensation.

However, in no-fault insurance states, both party’s insurance companies pay for injuries, regardless of who is at fault. Further, lawsuits are typically only allowed in cases of serious injury.

Additionally, no-fault insurance coverage states often restrict injured parties from suing for pain and suffering. These rules do not apply in at-fault insurance states like Colorado.

What is No-Fault Insurance?

No-fault insurance coverage typically compensates for medical expenses for the policyholder and passengers, lost wages, damage to the other party’s property, and even funeral and burial expenses. In no-fault states, this coverage is mandatory.

However, because Colorado is an at-fault state, residents cannot purchase no-fault insurance. Instead, they must carry liability insurance to cover any damage they cause to others.

States With No-Fault Coverage

Most states require at-fault coverage. However, there are some exceptions:

• Florida
• Hawaii
• Kentucky
• Massachusetts
• Michigan
• Minnesota
• New Jersey
• New York
• North Dakota
• Pennsylvania
• And Utah are all no-fault states

Advantages and Downsides

The benefit of living in a no-fault state is that you do not have to prove fault before receiving compensation. Your insurance company will pay medical expenses and lost wages, regardless of whether you caused the accidents.

The drawbacks?

• Higher insurance premiums
• Limited ability to pursue additional damages
• Capped coverage
• You pay higher insurance premiums, even if you have a spotless driving record
• You may not be able to hold negligent drivers fully accountable

At-Fault: The Advantages and Downsides

Ultimately, the benefits and downsides of living in an at-fault state boil down to whether you are responsible for the accident.

If you aren’t at fault, you can sue for full compensation without caps on recovery amounts. There are also two recovery avenues—filing an insurance claim or a lawsuit to hold negligent parties accountable. Additionally, at-fault state law permits you to pursue compensation beyond medical bills and lost wages.

However, things shift out of your favor if you are at fault. In addition to paying the damages you caused, you may be responsible for paying any damages that exceed your coverage limits. You may also face additional legal action from injured parties.

This is why consulting with an experienced legal team like JBP is so important. Our attorneys deeply understand Colorado law. So, whether you are fighting for compensation or defending against a claim, our attorneys have the experience to guide you through the at-fault system and ensure the best possible outcome.

When You Need an At-Fault State Legal Expert, We’re Here

Whether you are a personal injury victim or a negligent party, our attorneys can help. For victims, we will fight against insurance companies who attempt to minimize the extent of your injuries, help you gather evidence, and build a case to prove fault. If you caused the accident, we will protect you from claims that exceed your insurance policy coverage and investigate any other factors that may have contributed to the accident. Need help? Contact us today !