What is No-Fault Car Insurance and How Does It Apply to You?

If you’ve lived in Utah very long, you probably know it’s a no-fault state when it comes to car insurance in Salt Lake City and the rest of the state. If you’re new here, you may not be sure what this term means and how it will apply to you as a driver. It’s an important part of auto insurance in Utah, so you should have a basic understanding of this part of your coverage.

What No-Fault Means

Utah is one of only a handful of states that uses no-fault coverage. The idea is it will result in fewer lawsuits because everyone is responsible for the damage to their own vehicle regardless of who is at fault.

If you’re involved in a collision with another person, each party will report the accident to their own car insurance. It will pay for medical costs through what is known as personal injury protection or PIP. You’re required to carry a minimum of $3000 of coverage for PIP in Utah. It provides protection for you and your family members who are injured in a car accident.

What Happens When PIP Runs Out?

In an accident, $3,000 isn’t a lot of money, so you may wonder what will happen once your medical costs have exceeded that amount. Once you’ve used up your PIP coverage, you can file a claim against the other driver’s insurance company if they were at fault.

No-fault doesn’t mean no one was at fault, but it requires you to seek coverage from your own insurance provider before filing a claim against the other driver. The idea is fewer people will file minor and frivolous claims if it must be against their own policy first.

You’re still required to carry liability auto insurance in Utah. In fact, you must have the following amount of coverage if you’re a resident of this state:

$25,000 for injury per person

$65,000 maximum for injury per accident

$15,000 for property damage per accident

Remember, these are the minimums required by the state. You can take out a policy with higher limits. In fact, this is advisable if you travel a lot or live in an area with a higher rate for accidents. A major accident will max out your coverage pretty quickly if you only carry the minimum.

Once you’ve used up your policy’s coverage limits, you’re the person who is responsible for any other costs in the accident if you’re found to be at fault. Don’t just look at the cost of having liability insurance. Think about the cost of not having it.

The term "no-fault" may be misleading. It doesn’t mean you can never be held at fault for an accident or that you won’t have to pay for expenses associated in an accident where you are at fault. It’s important that you carry enough coverage to protect you from a major incident. However, you also need to know that you will file with your own insurance provider for many minor incidents.

ASA Insurance provides excellent coverage for car and home insurance in the Salt Lake City area with the lowest rates to the English and Spanish communities. Affordable rates and superior service for all home, auto and business/commercial insurance needs.

Asa Insurance provides excellent coverage for auto insurance in the Salt Lake City area with the lowest rates to the English and Spanish communities. Affordable rates and superior service for all home, auto and business/commercial insurance needs.