New York No-Fault Insurance Explained: What Every Driver Must Know

What Is No-Fault Insurance?

New York is a "no-fault" insurance state. This means that after a car accident, your own insurance company pays for your medical expenses and lost wages — regardless of who caused the accident. This system is designed to speed up the claims process and reduce lawsuits over minor injuries.

The no-fault system is built around Personal Injury Protection (PIP), which is a mandatory part of every NY auto insurance policy. PIP covers you, your passengers, and even pedestrians injured by your vehicle.

What Does PIP Cover in New York?

New York requires a minimum of $50,000 in PIP coverage per person. This covers:

• Medical expenses — hospital bills, surgery, rehab, prescriptions, and more
• Lost wages — up to 80% of your income, capped at $2,000 per month for up to 3 years
• Other reasonable expenses — up to $25 per day for services you can no longer perform yourself (like household help)
• Death benefit — $2,000 paid to the estate of anyone killed in a covered accident

PIP benefits are available no matter who caused the accident. You file with your own insurer, not the other driver's.

The "Serious Injury" Threshold

While no-fault covers medical bills, it limits your ability to sue the other driver. In New York, you can only file a lawsuit against the at-fault driver if your injuries meet the "serious injury" threshold defined by Insurance Law § 5102(d). This includes:

• Significant disfigurement
• Bone fracture
• Permanent limitation of a body organ or member
• Significant limitation of a body function
• Full disability for 90 days within 180 days of the accident

If your injuries don't meet this threshold, the no-fault system is your only recourse for compensation.

No-Fault vs. Full Coverage: What Else Do You Need?

No-fault / PIP is just one piece of the puzzle. New York also requires:

• Bodily injury liability — $25,000 per person / $50,000 per accident minimum
• Property damage liability — $10,000 minimum
• Uninsured motorist coverage — $25,000/$50,000 minimum

Many drivers also add collision and comprehensive coverage, especially if you finance or lease your vehicle. Want to see how much you could save? Try our savings calculator for a quick estimate.

How No-Fault Affects Your Premium

Because New York mandates no-fault coverage, premiums in the state tend to be higher than national averages. NYC drivers pay some of the highest rates in the country — an average of $3,000-$5,000 per year in boroughs like Brooklyn and Manhattan.

The good news: shopping around and comparing carriers can save you hundreds. Licensed NY agents at NY Car Insurance Quotes compare rates from top-rated carriers to find the best deal for your situation. Call us at (718) 801-2720 or get a free quote online.