New York is only one of 12 states, as well as Puerto Rico, in the United States that requires insurance companies to utilize a no-fault policy after an insured driver is involved in an accident. This policy states that motorists involved in accidents will first go to their own insurance for coverage, instead of filing with the other driver’s company.

The law is intended to benefit small claims disputes, expediting compensation to the policy holder. However, how air-tight is the no-fault law? Are there limitations to what a policyholder can file for? 

Auto insurers and their defense attorneys frequently face protecting themselves from inflated or fraudulent claims that seek to exceed the limitations of policy coverage under New York’s insurance laws. This post will discuss coverage limits, which plaintiffs often overlook when filing a claim or seeking excessive damages through a lawsuit.

Monetary threshold

Typically, no-fault will pay up to $50,000 for medical expenses or lost wages. These expenses can include bills for hospital expenses, prescriptions, x-rays and other tests, as well as physical therapy. A possible other expense includes payment for the driver’s loss in wages. 

Time threshold 

There are three instances of limitations that are time specific when looking at no-fault coverage.

• 30-days: An insured driver only has 30 days to submit their claim. Anything past the 30 days can either be denied, or the insurer can request written documentation of why the claim was overdue.
• 45-days: An injured driver only has 45 days to submit medical bills in order to receive compensation. The 45-day timeline starts on the date of treatment.
• 90-days: A driver that lost wages due to an accident only has 90 days to file a lost wage claim. After this, an insurance company has the ability to deny coverage for any wages lost.

Insuring a driver involved in a car accident can be costly for insurance companies, especially with the no-fault law in place. However, there are limits to the law.