No Fault Accidents: The Role it Plays on Your Record

Imagine you’re driving to the beach with your best pal Bob. Bob runs a stop sign and t-bones another car. You suffer a neck injury and the driver of the other car comes away with a laceration that needs stitches.

In an at-fault state

Bob’s bodily injury liability insurance should pay for your medical bills and the other driver’s medical bills. Note that Bob’s bodily injury liability insurance would not pay for any injuries Bob might sustain, however.

In a no-fault state

Bob’s PIP coverage pays for your medical bills. If Bob is also hurt, his PIP coverage covers his medical bills, too. The other driver files a PIP claim with his or her own insurer to pay for the stitches.

The purpose of a no-fault system is to help injured parties get their medical bills paid quickly and without court involvement. In the Bob scenario, the other driver doesn’t have to chase after Bob or his insurance company to secure funding for those doctor’s visits. And while the insurance company may still investigate the incident and decide who was at fault, that investigation shouldn’t delay payment on the PIP claim.

The no-fault system is most advantageous in situations where the at-fault driver is unreachable or has no insurance. Someone who’s injured in a hit-and-run, for example, can settle the medical bills right away — without having to wait for a police investigation to identify and track down the driver who caused the accident.

Yes, a no-fault accident can be your fault. Interestingly, the fault is still an important concept even in no-fault states. In our scenario above, Bob was clearly at fault. For that reason, the accident will show up on Bob’s driving record no matter where he lives.

The accident may also show up on the other driver’s record, but this depends on state law. For example, Florida lists accidents on your record if a citation was issued, which normally means you did something to cause the accident.² Michigan law is similar.³ In Pennsylvania, though, all accidents are kept on your record, regardless of fault.⁴

Usually, a no-fault accident will stay on your record for three to five years — but the specifics are determined by the laws in your state. Generally, smaller accidents and tickets will roll off your record after three years, while major violations can stick around for much longer. Often, it’s the violation, rather than the accident, that lingers. For example, if you cause an accident because you were driving recklessly, the reckless driving violation might remain on your record for 10 years or more.

Your insurance provider may increase your rates after a no-fault accident, whether or not you were at fault. That’s more likely to happen if the insurer paid out money on your PIP claim. But know that a history of accidents is a red flag to any insurance company, even if those accidents were caused by someone else.