To meet the financial responsibility requirements needed to register your car and get license plates, you must buy at least the following types and amounts of insurance:
New York is one of 12 states that require drivers to carry no-fault auto insurance. This system is quite different from traditional liability coverage so it’s important for drivers to understand how no-fault works when getting insured in the state.
This comprehensive guide provides an overview of key aspects of New York’s no-fault system, including required coverage, benefits provided, how claims work, and tips for consumers.
What is No-Fault Auto Insurance?
With a traditional auto policy, when an accident occurs, insurance companies determine who was at fault and that driver’s insurer pays for damages. No-fault eliminates this process for minor injury claims.
Instead, under no-fault, your own auto insurer covers costs like medical bills and lost wages up to the policy limit, regardless of fault. You can only sue another driver if serious injury thresholds are met
No-fault aims to reduce lawsuits and speed up claim payments. Drivers trade the ability to sue for minor injuries for guaranteed coverage of losses through their own policy.
Required No-Fault Coverage in New York
All motor vehicles registered in New York must carry no-fault coverage. The state minimums are:
- $50,000 for medical expenses
- Up to $2,000 per month for lost wages (80% of gross income)
- Up to $25 per day for other expenses like transportation
Higher optional limits are available. Additional no-fault and umbrella policies can provide further protection.
How No-Fault Claims Work in NY
When you’re in an accident, here’s how no-fault claims work:
- Report details to your insurer within 30 days of accident
- Submit medical bills within 45 days, lost wage claims within 90 days
- Your insurer pays covered costs up to policy limit, regardless of fault
- Once limit is reached, other policies or health insurance covers additional costs
- You can only sue another driver if you meet “serious injury” threshold
Insurers must follow tight regulations on claim procedures and prompt payment. Report non-compliance to the NY Department of Financial Services.
Key No-Fault Benefits for New York Drivers
No-fault coverage provides vital protections by covering costs related to auto accidents Here are some of the most significant benefits
Medical Expenses – Pays for treatment, rehabilitation, prescriptions, and more. Covers hospital, surgery, chiropractic care, physical therapy, etc.
Lost Wages – Reimburses up to 80% of gross income if you miss work due to accident-related injuries.
Other Expenses – Provides up to $25 daily for costs like transportation, household help, and other accident-related costs.
Death Benefit – Pays up to $2,000 to the estate of anyone killed in an accident.
Pedestrian Coverage – Applies no-fault benefits if you’re struck as a pedestrian. Covers medical, lost wages, other costs.
Having guaranteed coverage for these accident-related costs provides significant financial protection. Make sure to get high enough limits when buying a policy.
“Serious Injury” Threshold to Sue in New York
Under no-fault, the ability to sue another driver is restricted to protect the system. However, seriously injured victims can still pursue legal action if the below statutory thresholds are met:
- Death
- Dismemberment
- Significant disfigurement
- Fracture
- Loss of fetus
- Permanent loss of use of body organ, member, function or system
- Permanent consequential limitation of use of a body organ or member
- Significant limitation of use of a body function or system
- Injury resulting in inability to perform usual activities for 90+ days
If your doctor certifies your injury as “serious” per the above criteria, consult an attorney on possible negligence claim options against the at-fault driver.
This allows those with major damages to still recover complete compensation through lawsuits.
No-Fault for Motorcycles and Other Vehicles
-
Motorcycles – Excluded from no-fault benefits. Riders can sue other drivers from first dollar of loss.
-
Out-of-State Drivers – Their home state’s coverage rules apply. NY residents hit by out-of-state drivers can still claim no-fault benefits from their own policy.
-
Commercial Vehicles – Exempt from no-fault requirements if registered as commercial. Still need liability coverage.
-
Off-Road Vehicles – Not required to have insurance if used exclusively on private property and not on public roads.
If other vehicle types are involved in accidents, consult the NY Department of Financial Services on how no-fault rules apply.
Tips for Consumers Dealing with No-Fault Issues
Here are some tips for New York consumers to make sure you maximize your no-fault protections:
-
Review required policy coverages when shopping for insurance. Consider higher limits.
-
File claims promptly. Insurers can deny late submissions. Send medical authorizations quickly.
-
Save all accident records, treatment notes, expenses, lost wage documentation, etc. to support claims.
-
If an insurer disputes a claim, file for arbitration within 180 days of denial.
-
Consult a personal injury attorney on options if “serious injury” threshold is met.
-
Report claim delays, denials, or bad faith actions by insurers to the Department of Financial Services.
-
Request additional no-fault coverage from other household policies if yours is exhausted.
Know your rights and remain persistent until you recover all benefits entitled by law. Don’t hesitate to file official complaints if an insurer fails to comply with regulations.
Is New York’s No-Fault System Here to Stay?
While no major reforms have passed recently, there has been ongoing debate about problems with New York’s almost 50 year old no-fault system.
Critics argue it drives up auto insurance costs due to excessive litigation over “serious injury” thresholds. There are also problems with fraud from unscrupulous medical clinics.
Supporters counter that no-fault has achieved its main objective of speeding up claim payments for minor injuries, while still allowing seriously injured accident victims to pursue lawsuits.
It’s unclear whether the New York legislature will ever fully repeal no-fault. However, many advocate for reforms to tackle fraud, reduce disputes over thresholds, and control costs.
The Bottom Line on NY No-Fault Insurance
New York’s unique no-fault auto insurance system has its strengths and weaknesses. But it provides guaranteed coverage of accident losses through your own insurer.
Make sure you understand requirements, benefits and claim procedures. Seek expert guidance on maximizing protections if you are hurt in a crash. No-fault insurance delivers vital benefits, but consumers must be diligent to avoid potential pitfalls.
Insurance Information and Enforcement System (IIES)
Keep in mind how important it is to keep up with your required auto insurance coverage as long as you own a car. The Insurance Information and Enforcement System (IIES) is a system run by the New York Department of Motor Vehicles (DMV) that finds cars that don’t have insurance.
Insurance companies must give the DMV information about everyone they insure for auto insurance, including when policies are canceled, renewed, or issued for the first time. This information is entered into an electronic database that will continuously track insurance coverage for each registered vehicle. Not having liability insurance on your car at all times can get you fines, the suspension of your vehicle registration, and even the loss of your driver’s license.
By following these steps, you might get a letter from the DMV asking about your insurance, even if your car is already covered. Do not wait to respond to any correspondence like this from the DMV, even if you are sure that your insurance is still valid. You can get help responding to these letters from your insurance agent, broker, or company, or you can call the DMV directly to find out how to handle such letters.
Liability Insurance-Bodily Injury & Property Damage
If someone else (a “third-party”) makes a claim against you, saying that you were careless or otherwise at fault, this liability coverage will protect you and anyone driving your car with your permission. In the event that your car is involved in an accident that seriously hurts or kills someone or damages their property, this coverage will pay that person on your behalf.
Your insurance company must also give you a legal defense against these kinds of claims without lowering the liability limits in your policy.
The minimum limits of third-party bodily injury liability coverage mandated by New Yorks Vehicle and Traffic Law are:
- $25,000 for bodily injury that doesn’t lead to death and $50,000 for injury that does lead to death in any one accident;
- $50,000 if two or more people are hurt physically in the same accident but don’t die, or $100,000 if two or more people are killed in the same accident (this does not include the above per person limits).
It is the law that you have to have at least $10,000 in property damage liability coverage for damage to someone else’s car or property. In New York, these minimum liability limits are sometimes referred to as “$25,000/$50,000/$10,000” or “25/50/10.”
If, on the other hand, you use or drive your car in another state or Canadian province that has higher liability limits than the ones required by New York or what you bought, your policy will cover those higher limits.
You might be able to make a claim against the other driver’s auto insurance for bodily injury and property damage liability if they hurt you or damage your car in an accident because they were careless. You must establish that the other party was at fault. You can sue the other driver in the car accident for pain and suffering, but only if you had a “serious injury,” as defined by the Insurance Law. You can also sue a third party in court for damage to your property and, if you were hurt, for other economic loss that isn’t covered by or goes beyond your No-Fault coverage.
You would be suing someone else on your own, and your insurance company would not be involved because of your policy. Even if you decide to sue someone else, your own insurance company is not required to give you or pay for a lawyer to handle your claim against them.
Your auto liability insurance covers every passenger in your car who gets hurt in an accident caused by the driver’s carelessness. However, if your spouse gets hurt, your insurance probably won’t cover any liability unless you buy Supplemental Spousal Liability Insurance. However, your spouse would still be eligible for basic No-Fault coverage as discussed earlier. If you are shopping for insurance, please ask your insurance company, agent, or broker if your policy covers your spouse for bodily injury liability.
Another important part of your auto insurance is bodily injury protection for you, your family members who live with you, and other people who are in your car if you or they get hurt because of someone else’s carelessness, like a hit-and-run driver or someone who doesn’t have insurance. Please note that this required coverage only covers injuries to people hurt in accidents in New York State. It does not cover damage to your car or other property.
For accidents in New York, the minimum amount of protection for uninsured drivers must be the same as the minimum amount of protection needed for liability insurance. For a small extra fee, this uninsured motorists coverage can be expanded to cover accidents that happen in other states by endorsement. If you want this coverage to be extended, you should talk to your agent, broker, or insurer.
If someone in your car gets hurt by an uninsured driver or a driver who hits and runs, you should file a claim with your auto insurance company under this coverage. Also, you should file a claim with your car insurance company if you or a family member gets hurt while riding in an uninsured car or if you get hurt while walking by an uninsured or hit-and-run driver. You can make a claim under that policy even if you don’t have a car but someone in your family does.
If you don’t have your own policy and are not covered by a family member’s policy in your household and if you are injured as a pedestrian by an uninsured vehicle or hit-and-run driver or as an occupant of an uninsured vehicle in New York State, you may still be eligible for uninsured motorists protection and No-Fault coverage. You or your representative should immediately report the accident to proper authorities, and then promptly (because there are stringent time limits) file a claim with the Motor Vehicle Accident Indemnification Corporation (MVAIC), located at 110 William Street, 19th Floor, New York, New York 10038 (Tel: 646-205-7800) (Fax: 212-732-1826). Additional information on the MVAIC website.