No-fault insurance
A scheme under which an injured person’s own insurer pays defined benefits regardless of who caused the accident, with the right to sue restricted to cases that meet a serious-injury threshold.
What it means in practice.
Florida (PIP), Michigan, New York, New Jersey, and several other US states operate no-fault schemes; so do Quebec and several Australian CTP schemes. Threshold definitions vary.
Under no-fault car insurance, your own policy pays your medical bills and lost income after a crash, whoever caused it. In exchange, the right to sue the other driver is limited: you can claim pain and suffering only if your injury passes a threshold.
Thresholds come in two kinds. A verbal threshold describes the injury, such as a fracture, permanent impairment or significant disfigurement. A monetary threshold turns on money, such as medical bills over a set amount. Some states use both.
British Columbia went further. For crashes from 1 May 2021, a person has no right to sue for bodily injury caused by a vehicle in most cases, and benefits from ICBC’s Enhanced Care scheme replace the lawsuit.
How it works in different places.
| Where | How it works | Source |
|---|---|---|
| New York | Pain and suffering needs a serious injury, such as a fracture or significant limitation of use. The 90/180 day category was removed from 26 May 2026. | Insurance Law § 5102(d) |
| Michigan | Death, permanent serious disfigurement, or an objectively manifested impairment of an important body function that affects the ability to lead a normal life. | MCL 500.3135(5), as quoted in Patrick v. Turkelson (Mich. Ct. App. 2018) |
| Florida | Significant and permanent loss of an important bodily function, a permanent injury, significant and permanent scarring, or death. | Fla. Stat. § 627.737(2) |
| Minnesota | Medical expenses over $4,000, or permanent disfigurement, permanent injury, death, or disability of 60 days or more. | Minn. Stat. § 65B.51, subd. 3 |
| Kentucky | A fracture qualifies on its own; tort liability is abolished to the extent PIP benefits are payable, so the first $10,000 of economic loss is not recovered from the other driver. | KRS 304.39-060(2) |
| British Columbia | For crashes from 1 May 2021, no right of action for most bodily injury; ICBC Enhanced Care benefits instead. | Insurance (Vehicle) Act, ss 114, 115 |
A worked example.
A broken wrist that did not pass: Rodriguez v. Crosby (Utah Ct. App. 2024)
- Accident
- September 2017; a driver turned left in front of the family’s van
- Injury
- A child’s fractured right wrist; cast for about six weeks, no surgery
- Argument
- The injury met the old threshold or the amended one in force at trial
- Held
- The version in force on the accident date applies, and it was not met
- Result
- Summary judgment for the driver affirmed
In Kentucky a fracture passes the no-fault threshold by itself. Under the Utah threshold that applied to this 2017 crash, the healed wrist fracture was not enough to sue for pain and suffering.