Clever or unscrupulous, no matter how you characterize it, no

Clever or unscrupulous, no matter how you characterize it, no one likes to fall victim to fraud and scams. Unfortunately, we're all likely to be victimized even if we never actually come across someone who's cutting corners to make a buck.

Insurance Fraud

Generally, fraud occurs when someone intentionally lies about something to get something he doesn't deserve or hasn't earned. Money or services are usually what he's after. Fraud is a crime in every state. It's usually treated as theft because the person gets or takes something he's not entitled to legally.
Insurance fraud happens when someone gets the benefits of an insurance policy he's not entitled to. Or, insurance agents - either real agents or scammers - take your insurance premiums and don't provide you with the coverage you're after, and sometimes no coverage at all.
According to the Coalition Against Insurance Fraud (CAIF), the economy has had a big impact on insurance fraud. In 2009, state fraud bureaus - agencies in charge of investigating and preventing fraud - reported a 15 percent increase in all of the major categories of fraud tracked by CAIF.

Many Forms

Insurance fraud takes many forms. For instance:
Slip-and-Fall "Accidents." There's been a big increase in personal injury claims by customers and patrons against property owners and insurance companies. The claims have doubled across the US, but they've skyrocketed in Las Vegas.
Accidents. Fake or staged car accidents are widespread. One common ploy involves scammers intentionally causing an accident to collect insurance money for property damage and medical expenses. Sometimes the scammers work with clinics and share the money they bilk out of insurance companies for unneeded medical treatment.
Property Damage. People with insurance are setting their cars on fire and falsely reporting them as stolen to collect on insurance. They're also padding or inflating insurance claims when personal property is lost or damaged, either on purpose or in a real incident, like a fire or burglary.
Agents, too? With the new health care law, there's no shortage on health insurance scams. Some popular ones involve insurance "firms" and "agents" offering plans that provide no coverage at all; claiming "full coverage" but giving only very limited coverage; charging high premiums for very small discounts on prescription medicines.

Impact

The net effect of these and dozens of other insurance fraud schemes and scams hits us all, whether or not we actually come face-to-face with a scammer. When insurance companies pay out on false or fraudulent claims, they pass on that expense to you and me. We pay higher premiums for car, homeowners', and other insurance.
We may pay more for goods and services, too. The store or mall hit with a bogus slip-and-fall accident may increase prices to recoup the money it pays to the "victim" or has to pay in increased insurance premiums.

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In the end, someone always pays. It just may not be the person you expect

In the end, someone always pays. It just may not be the person you expect. If someone injures you or damages your property, your insurance policy may cover your damages. But it may not end there, especially for your insurance company - and maybe even for you.

Toyota's Continuing Woes

You may have heard about Toyota's recall saga: Millions of its cars were recalled in 2009 and 2010 for various defects, ranging from faulty floor mats to sticking gas pedals. Hundreds of lawsuits were filed across the US by drivers (or their families) injured, killed or suffered property damage because of the alleged defects.
A new chapter in the saga began in February 2011 when the car maker announced a recall of around 20,000 vehicles because of problem with the carpeting near the gas pedals. Another wave of lawsuits is almost a certainty.

Who Pays Insurers for the Claims?

Naturally, injured drivers and owners with damaged cars looked to their insurance companies whether or not they filed lawsuits or joined any of the class action lawsuits against Toyota, and the companies have paid many claims already.

Insurers Want Their Money, Too

Pay outs by the insurance companies didn't end the matter, though. Insurance companies such as Allstate and Fireman's Fund, along with at least six others, sued Toyota. They want Toyota to pay them what they paid out to their customers on claims involving the defective cars.
In all, they want a little over $3 million from Toyota in compensatory damages. They just might get it, too.

Subrogation

Subrogation is a legal tool where someone steps into the shoes of another person to enforce that person's legal rights. It's very common in the insurance field, especially when personal injuries happen.
For example, say you're injured in a car accident with Driver A. You file a claim for $10,000 for your medical bills and car repairs with your insurance company. Your insurance company pays the claim. Then, your insurance company goes after Driver A to recover the $10,000 it paid to you.
This is exactly what the insurance companies are doing with Toyota. The trick is that they have to prove Toyota was at fault or to blame for the injuries and damages suffered by the insurance companies' customers. Driver-owner victories against Toyota already - including a $10 million settlement in 2011 in a wrongful death case - bode well for the companies.

What It Means for You

Subrogation by your insurance company can impact you and the rest of us. It can be good, and maybe not-so-good. On the upside, subrogation helps keep insurance rates down. After all, if the insurance companies can recoup what they pay out in claims, it's like not paying claims at all.
Instead of recouping the money from you and me in the form of higher premiums, they recoup it from the parties at fault. Customers save money, the person or company who's truly to blame for injuries and damages is held responsible and accountable: Win-win.

Impact on Legal Rights

On the downside, subrogation may have a negative impact on your legal rights and maybe your wallet - so to speak. You see, as a general rule, you can't get paid by your insurance company and by the person hurt you, too. The law lets you recover for your damages, but it doesn't let you profit from your injury or damage.
So, in the example above, say after you're paid $10,000 by your insurance company you file a personal injury lawsuit against Driver A. A jury awards you $20,000. As a general rule, you'd have to repay your insurance company $10,000 it paid to you. If you don't repay it, it could place a lien against your award and have the money taken directly from it.
You may be able to file a claim with your insurance company if you've been injured, but understand how your claim may impact your legal rights and ability to get reimbursed. It might benefit you to talk to a lawyer about how this affects your claim.

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Car accidents are an unfortunate fact of life. The majority of people

Car accidents are an unfortunate fact of life. The majority of people, at some point in their lives, will likely be involved in a car accident. It could be a minor fender bender, or, sometimes, a serious crash involving lawyers, doctors, hospitals and repair shops.
A car accident can be a physical and mental pain. Besides the injuries resulting from the actual crash, your insurance premiums may go up, you'll have to pay for car repairs and doctor visits, and you may be involved in a lawsuit as a result.
Collectively, car accidents cost a lot of money. The Centers for Disease Control (CDC) says that the costs of car crash injuries are more than $99 billion a year¹.
In addition, car crash-related injuries are the leading cause of death for people between the ages of one to 34. From Car-Accidents.com:

Car Crash Stats: There were nearly 6,420,000 auto accidents in the United States in 2005. The financial cost of these crashes is more than $230 billion dollars. 2.9 million people were injured and 42,636 people killed. About 115 people die every day in vehicle crashes in the United States - one death every 13 minutes.

What We Can Do to Reduce this Impact?

The CDC's fact sheet shows ways to reduce the human and economic toll of car accidents. Suggestions include:

• Improve child passenger safety
• Improve teen driver safety and skills
• Reduce drunk driving
• Increase seat belt use

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Automobile insurance is a contract between a policyholder and

Automobile insurance is a contract between a policyholder and an insurance company to cover losses due to use and operation of the automobile. Many states require drivers to have automobile insurance. Even if not required, you need insurance since the cost of some losses is likely to exceed the net worth of individuals. There are many different types of policies, and policyholders can choose from a number of options when buying insurance.

Automobile insurance considers four primary risks:

• Physical damage to your automobile or another person's automobile
• Liability for physical injuries to other persons
• The cost of your medical care if you're injured in an accident
• Attorney's fees if you are sued

Automobile insurance may cover each of these risks; the amount of coverage per claim depends on the dollar amount of the policy. Not having automobile insurance exposes you to tremendous financial risks because of the high costs of property, medical care and lawsuits.

No-Fault and Fault Systems

Each state has one of two kinds of automobile insurance systems:

• No-fault automobile insurance systems
• Fault automobile insurance systems

No-fault. In states with no-fault automobile insurance systems it doesn't matter who caused the accident. Each insurance company pays for the property damage and medical expenses of its policyholders according to the terms of the policy. If the property damage or medical injury is serious and expensive, the no-fault system may not apply and fault will have to be determined to identify the insurance company that is liable for the loss.

Fault. In states with fault automobile insurance systems, it does matter who caused the accident. Fault is either admitted or proved. Determining fault may involve a lawsuit. The insurance company of the at-fault driver pays the losses of the other driver. The insurance company of the at-fault driver also pays the losses of the at-fault driver according to the terms of the policy.

There are three major types of automobile insurance: collision, liability and medical expense.

• Collision covers property damage to your car caused by an accident. It doesn't cover the other person's car.
• Liability insurance covers property damage and personal injury to the other driver.
• Medical insurance covers the cost of your personal injury. Your health insurance company also may cover the cost of your medical care resulting from an automobile accident.

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Liability auto insurance is required in all states. Benefits are provided

Liability auto insurance is required in all states. Benefits are provided under a fault or no-fault system. Under the "fault" system, the insurance company pays benefits based on whose fault the accident was, whereas "no-fault", benefits are paid regardless of who is at fault for the incidence.
In both cases, states make sure that car owners and drivers have the required liability insurance by:

• Financial responsibility/security laws, or
• Compulsory insurance

Financial Responsibility/Security Laws

Ownership of motor vehicles became more popular in the early 1900's, but there was no insurance for them yet. As ownership became more widespread, some states realized the need to cover owners if someone was hit by a driver and they didn't have enough money or assets to recover costs. Who was supposed to pay the injured party's damages - especially medical bills?
This problem was initially solved through financial responsibility/security laws. These are still used today although the statutes have somewhat changed.
The basic idea is if a driver caused an accident resulting in an injury or death of another person, he was required to show proof of financial responsibility. That is, proof that the he could pay any judgment against him for damages to the other person or party. If the driver couldn't, his license could be suspended or revoked. Also, the driver would have to provide some type of security - financial or property - to guarantee payment to the injured person.
Over time, this became more and more difficult to administer, especially to determine what type of security was needed and why a driver's license could be revoked and for how long. These laws aren't widely used today for these reasons.

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Think twice before agreeing to arbitrate. By asking yourself a few questions

Think twice before agreeing to arbitrate. By asking yourself a few questions, you can make an intelligent decision as to whether or not arbitration of a dispute will be in your best interest.

The Basics

What is arbitration?

The essence of arbitration is that it is an agreement between two or more parties to try to resolve a dispute outside of the court system. The parties agree upon a third party as an arbitrator who will act as a judge and jury. After giving the parties the opportunity to present their side of the story and to present any relevant documents or other evidence, the arbitrator will act as King Solomon to decide who wins and who loses.

There are usually no set rules as to how arbitration is conducted. It is typically left to the agreement of the parties. To facilitate the process, though, the parties will oftentimes agree to use the rules of an established organization like the American Arbitration Association.

There can be binding and non-binding arbitration. A "binding" arbitration generally means that the winning party can take an arbitration award to a court of law and enforce it if the losing party does not comply with the terms of the decision.

"Non-binding" arbitration refers to a situation where the parties agree to use arbitration as a forum to try to resolve their differences, but neither party is bound to comply with any decision by the arbitrator.

What are some of the benefits of arbitration?

The number-one benefit of arbitration is that it serves as a forum to resolve disputes outside of the judicial system. Arbitration can be fast, quick and easy, whereas lawsuits can drag on for years and years. Since the rules of evidence and procedure are usually relaxed in arbitration proceedings, the parties are also in a better position to represent themselves without having to get lawyers involved.

It naturally follows that arbitration also tends to be less expensive than pursuing a lawsuit. While the parties will usually end up having to pay the arbitrator, his or her fees will inevitably be less than the attorneys' fees that they may have to pay to take the same case to trial.

Even in non-binding arbitration, a benefit can be that it serves to bridge the gap in an adversarial proceeding so that the parties can get a better glimpse of where things are headed if they are unable to resolve their differences. Most cases settle, but many times it is not until the parties are "on the courthouse steps." Non-binding arbitration may help to facilitate a settlement sooner rather than later.

Another good thing about arbitration is that an arbitrator is typically not bound by the strict rules of procedure in reaching a decision. He or she can consider a lot more facts and circumstances than a judge or jury. Arbitrators typically try to be practical and oftentimes look at compromise as being inherently fair. Thus, the likelihood is that an arbitrator's decision will award something to at least one of the parties. However, you would not expect that damages would be awarded that were anywhere near what a jury might have awarded if (and that is a big if) the matter were to have been tried before a jury.

Arbitration can also bring finality. Sometimes for the better, a decision on a binding arbitration cannot be appealed or overturned in the absence of a showing of extraordinary circumstances (for example, fraud, bias or other inappropriate actions on the part of the arbitrator). Thus, once a decision is rendered, the case is over. The losing party will typically not be able to appeal (which can make the matter drag on for years and years).

What are some of the drawbacks of arbitration?

There are no guarantees that arbitration will be a fair process. As noted, once a decision is rendered in a binding arbitration, the parties are generally stuck with that decision. Without the right to appeal, there is always the risk of being subject to the whims and prejudices of the arbitrator. Overall, this is probably the biggest drawback to the arbitration process.

Identifying other drawbacks will typically depend upon which side of the fence you are on. For example, if a party were concerned about a large jury verdict in the event a dispute ever arose, that party would negotiate for an arbitration clause so as to keep things out of court if a dispute happens to arise. For example, in view of the potential for a large jury verdict on a wrongful termination case, this might explain why an employer would want an arbitration clause in an employment contract. Given the potential for a large jury award on a malpractice action, this would also help to explain why a medical provider would want a patient to sign an arbitration clause.

Ironically enough, the rationale for having an arbitration clause in the first place may actually encourage parties to fight about something where a dispute otherwise could have been avoided. In the absence of an arbitration clause, the parties may be more inclined to compromise rather than pursue an expensive lawsuit. If arbitration is an option, though, there may not be the same deterrents and the parties may simply elect to fight about something rather than try to work out their differences more informally.

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When you've been injured by someone else's negligence, that person is responsible

When you've been injured by someone else's negligence, that person is responsible to you. Usually this means dealing with the person's insurance company. Sometimes the person's not insured, or doesn't have enough insurance to pay you. Then you may expect your insurance company to pay some or all of your damages.

Either way, dealing with an insurance adjuster can be frustrating and complicated. An adjuster is the person who decides what your claim is worth. It's important to get the most money for your claim. That's why it's a good idea to hire a lawyer to help you talk with the insurance company.

Negotiation

Your lawyer tells the people responsible you've been hurt. She lets them know you'll be filing a claim for your damages.

Your lawyer investigates the facts of your injury. You can help your lawyer by providing copies of the:

• Police report
• Traffic tickets given to the other person
• Photos of the scene of the accident
• Names, addresses and phone numbers of any witnesses and what they saw
• Medical records and bills
• Photos of your injuries
• Wage stubs proving how much you made at the time of the accident and how much work time you missed due to your injury

You'll also want to provide your lawyer with any other papers you may have showing how your injury has negatively affected your life.

Your lawyer won't want to begin serious negotiation with the insurance company right away. She must wait until your injuries have stabilized enough to know what the permanent effects are. This can sometimes take months or even years. Don't pressure your lawyer into negotiating too soon with the insurance company. It's a mistake to settle your claim before you know the full extent of your injuries.

After collecting all the information about your injury, your lawyer writes what's called a demand letter to the insurance company. This letter explains:

• Why the other person is responsible for your injuries
• The extent of your injuries and how you're likely to be affected by them in the future
• What type of medical treatment you've had and need to have in the future and how much it will cost
• Current and future income losses 
• Any other damages you've suffered as a result of the accident.

The settlement package sent to the adjuster includes all the documentation you've given your lawyer to support your claim.

Statutes of limitations determine how long you have to file a lawsuit

Statutes of limitations determine how long you have to file a lawsuit (or other claim) against another driver. If you fail to file a suit or claim within the specified amount of time your suit can't be pursued and you lose the opportunity to make a claim. Check with your state and insurance company to find out their statutes of limitations.
For example, if you are injured in an automobile accident and the state law provides that personal injury lawsuits must be filed within two years of the date of the injury, you must file your lawsuit within two years of the date of the accident or lose forever the right to sue the responsible party.
If you want to file an insurance claim against your insurance company or the insurance company of the other driver, you should file this claim within the time limits stated in the insurance policy. States also have statutes of limitations for filing insurance claims. Check with your state insurance department to determine what those limits are.

Claiming No-Fault Benefits

No-fault insurance is a type of insurance that pays for injuries and damages for each person in the claim regardless of whose was actually at fault.
Generally, the injured party should obtain and file the required claim notice with the insurance company within the first 30 days after the accident. If the specific claim form is not available, file a written claim anyway and then obtain the specific form. If the accident created multiple sources for payment of benefits, for example, if the injured person had several insurance policies, file claims with every insurer.
The injured party should promptly notify the insurer, because shortened periods of time to respond under statutes of limitations are quite common in no-fault laws. The penalty for failure to submit a timely claim may mean the entire loss of benefits. Courts have also upheld the limitations provisions in statutes as genuine statutes of limitations, and not mere requirements for notice.

Recovery and the Monetary Threshold

If you can't obtain payment from the insurance carrier, you may want to file a personal injury lawsuit against the person who caused the accident. This is also called a tort. Traditionally, tort law says the limitations for filing a lawsuit begins from the time of the accident. However, some states won't let you file a lawsuit until the damages exceed a certain dollar amount. In this case, the date fhat the statute of limitations isn't as clear. Check with your state laws or find an attorney who will know what your state's laws are.

Uninsured Motorist Actions

Subrogation Rights of the Insurance Company and the Uninsured Motorist Coverage

Insurance companies may refuse to pay uninsured motorist benefits under a insurance policy if a lawsuit was not filed within the statute of limitations.
The courts, however, tend to disregard this defense by the insurance company and view the lawsuit as a breach of contract lawsuit. This changes the statute of limitations for bringing a suit against the insurance carrier to the statute of limitations for contract actions. In some states, an insured's action against the insurance company is considered to stem solely from the car accident, and thus the statute of limitations for tort actions will apply.
Additionally, in lawsuits dealing with uninsured motorist coverage, court decisions vary as to whether the use of the statute of limitations defense can be used by an insurance company or only by the uninsured motorist.

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Most states have laws that require vehicle owners to have uninsured motorist

Most states have laws that require vehicle owners to have uninsured motorist (UM) insurance, which protects people injured in accidents caused by uninsured motorists. Victims would receive an amount equal to what they would have been paid had the motorist had been insured.
Uninsured motorist laws are different from state to state, but usually have two things in common:

• Requirement that insurance covers all payments that the victim is entitled to, and
• Meets the definition of uninsured vehicle (see below for definition)

Most UM policies spell out the following items:

• Who is an "insured"?
• Who is considered "uninsured"
• The types of vehicles that are and are not covered by the UM policy (ex. Whether motorcycles or trailers will be covered.)

It's critical to understand what your policy covers in regard to uninsured motorists. Don't wait until you're in an accident to find out. Find out what your state's policy is.

Who Is Covered?

It is crucial that the person claiming benefits under an uninsured motorist policy fall within the policy's definition of an "insured" because that is who the coverage is intended to protect. In general, insured persons fall into one of three classes:

• Class 1: The person named as the insurance holder and their family members
• Class 2: Authorized occupants of the vehicle
• Class 3: Persons related to the insured that suffered an injury from an accident with an uninsured vehicle. For example, children who seek damages for the death of a non custodial parent fall into this category.

Determining who falls into each category varies from state to state. The courts make this decision in many cases so it's important to know your state's laws if you need to claim UM benefits from your policy.

Getting or Having Coverage

Almost all states require insurers to offer uninsured motorist coverage. However, rental car companies generally do not have to offer uninsured motorist coverage through their insurance.
In some states you can refuse to carry UM insurance. The decision must be made by the "named insured" on the policy and:

• Must be in writing
• Must show that the insured understands what UM coverage is and what it means if the coverage is rejected, and
• Is effective on the date the rejection was signed, which is usually when the full application was signed.

What's Covered and What's Excluded?

The amount of UM coverage is usually set by the state, which is state or minimum coverage, that the insurer must provide. You may also purchase additional coverage up to a specified point, called maximum coverage.
Property damage coverage is most often excluded in UM policies, but a few states require coverage in the policy. Damages to your car in an accident with an UM will most likely be paid for with out-of-pocket funds or under another part of your policy.
Almost all UM laws give coverage for all sums that the owner is legally entitled to recover, but the laws do not define what that exactly means.
In many instances, you are legally entitled to recover damages when you can prove:

• That the uninsured motorist was at fault in causing your damages or injuries, and
• That damages can be measured and a certain amount of money will fully pay for your damages

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Insurance companies ("insurers") often include provisions in their automobile insurance

Insurance companies ("insurers") often include provisions in their automobile insurance policies that lower the amount of benefits that will be paid under the policy's no-fault provisions, that is, the provisions that allow for payment of such things as medical expenses and lost wages. Items like medical expenses and lost wages are known as "economic losses," as opposed to non-economic losses, such as payments for pain and suffering.
The requirements for coverage vary by state so you need to examine your policies and laws to determine if there are minimum or maximum payments you can pay before the policy starts paying for damages.

Deductibles

You may hear the word deductible used when deciding how much coverage you want to pay before the insurance company starts covering your claim. While you may pay less for a higher deductible, it also means that you'll have to put in more toward the cost of repairing damages to your vehicle.
For example, your policy might state that you have $10,000 coverage for medical expenses and there is $1,000 deductible. If, after an accident, you have $10,000 in medical expenses, you're responsible for $1,000 before the benefit of the policy starts paying the remaining $9,000. However, if you have only $500 in medical expenses, the insurer will pay nothing, because it'is less than the deductible. You may still put in a claim, but the policy won't cover it.
This also applies to damage to your vehicle.
You'll need to determine if you want to pay higher premiums for a lower deductible, or less money for higher deductibles. It depends on many factors, including your net worth, how much your vehicles are worth, how much cash you have available, and more.

Reductuion of Benefits

Each state has its own method about how insurers can apply deductibles.
For example, in some states, the insurer is allowed to pay 100 percent of the accident victim's economic losses, medical expenses and lost wages, up to the maximum amount allowed by the state's law, without any reduction of benefits by any deductible.
In several states, insurers can either deduct a certain percentage from the insured's medical or disability expenses or offer the deductibles and then pay the remainder to the insured. The deductible might be specified in the law, by a particular dollar amount, or the law may allow for a range of amounts, such as from $50 to $2,000.
In some states, deductibles may be applied only to the named insured on the policy and to the insured's relatives, who live in the same household. The idea here is to allow the insured to restrict his or her own recovery, but not to allow a reduction of benefits against the relatives, who are not parties to the insurance contract.

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Automobile insurance is a contract between a policyholder and an insurance

Automobile insurance is a contract between a policyholder and an insurance company to cover losses arising out of the use and operation of the automobile. Many states require drivers to have automobile insurance. Even if not required, automobile insurance is necessary since the cost of some losses is likely to exceed the net worth of some individuals and businesses.

Automobile insurance may be purchased by an individual or a business. There are many different types of policies, and prospective policyholders may elect among a number of options. For example, a small business owner may choose to insure all vehicles owned by the business when the vehicles are being driven for business purposes and when the vehicles are being driven by company officers for any purpose.

Automobile insurance for a business considers four primary risks:

• Physical damage to your business's automobile or another person's automobile
• Liability for physical injuries to other persons
• The cost of your medical care if you are injured in an accident
• Attorney's fees if you are sued

Automobile insurance may cover each of these risks; the amount of coverage per claim depends on the dollar amount of the policy. Not having automobile insurance exposes you and your business to tremendous financial risks because of the high costs of property, medical care, and lawsuits.

No-Fault and Fault Systems

Each state has one of two kinds of automobile insurance systems:

• No-fault automobile insurance systems
• Fault automobile insurance systems

No-fault. In states with no fault automobile insurance systems, it doesn't matter who caused the accident. Each insurance company pays for the property damage and medical expenses of its policyholders according to the terms of the policy. If the property damage or medical injury is serious and expensive, the no-fault system may not apply and fault will have to be determined to identify the insurance company that is liable for the loss.

Fault. In states with fault automobile insurance systems, it does matter who caused the accident. Fault is either admitted or proved. Determining fault may involve a lawsuit. The insurance company of the at-fault driver pays the losses of the other driver. The insurance company of the at-fault driver also pays the losses of the at-fault driver according to the terms of the policy.

There are three major types of automobile insurance for a business: collision, liability, and medical expense.

·  Collision covers property damage to your business's car caused by an accident. It does not cover the other person's car.

·  Liability insurance covers property damage and personal injury to the other driver.

·  Medical insurance covers the cost of your personal injury. Your health insurance company also may cover the cost of your medical care resulting from an automobile accident.

Uninsured and Underinsured Motorists

Let's say you're in an accident and the other driver doesn't have insurance or is underinsured; that is, the insurance doesn't cover the amount of your losses. What happens?

If you are in a no-fault state, it doesn't matter so long as your insurance policy is adequate to pay for all losses. However, if your losses exceed the value of your policy, then you have a problem.

In an at-fault state, it creates a problem for the innocent driver. There are two ways to solve this problem:

• You can buy uninsured motorist coverage from your insurance company to guard against this risk. In this case, your insurance company covers your losses to the extent of the dollar amount of the policy.
• You can sue the uninsured or underinsured driver. This method assumes that the negligent driver has assets to cover the cost of the accident. It also involves the expense of hiring a lawyer and possibly going to trial.

If you have any legal questions about the automobile insurance policies for your business or if someone in your company has been in an accident in a company vehicle, contact a small business attorney in your area.

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Under a "no-fault" auto insurance system - also called "personal injury protection

Under a "no-fault" auto insurance system - also called "personal injury protection" or "PIP" - the insurance company ("insurer"), pays for a car accident victim's "economic losses," which include things like:

• Medical expenses
• Lost income or wages and
• Burial and funeral expenses

"Non-economic losses," which include things like pain and suffering and emotional distress, usually are not covered by the no-fault insurance provisions. In some states, the victim can sue the driver who caused the accident to recover these damages, and there usually are restrictions on when such a suit can be filed. In some states, the victim can't sue the other driver at all.
The type of expenses that are covered and the amounts that insurers will pay vary from state to state, so it's important to know your state's no-fault laws and the specific language of your policy.

Limitations on Benefits

In some states, an insurer can limit the amount of PIP benefits that will be paid to an insured victim. The limitations can be based on time or the language in the insurance policy.
Time Limits
Some no-fault laws specify the period of time during which no-fault benefits will be paid. For example, in some states, all no-fault payments stop after two years, which is measured from the date of the loss, which is usually the date of the accident.
Other states might limit only some types of payments, like lost wages, to a certain period, while other states might limit the amount. For example, the victim might receive 90% of his or her lost wages in the first year after the accident, but then a smaller percentage in years two and three, and so on.
Policy Limits
Some no-fault laws let insurers specify the amount of PIP benefits that are payable - a " benefits ceiling." For example, some statutes allow a limit with a specific dollar amount for medical expenses, like $100,000, while some statutes allow "unlimited" medical expenses, but only if the they are "reasonable and necessary."
No state with no-fault car insurance allows unlimited benefits for wage losses.
Set-Offs
Most states allow insurers to "set-off," or reduce, the amount of no-fault benefits by the amount received by the injured insured from other sources. The most common set-off is for workers' compensation benefits paid to the insured victim.
Some states allow set-offs for Social Security disability payments and Social Security retirement benefits, while most states do not allow a set-off for Medicare and Medicaid benefits.
Other insurance coverage can also work to limit or reduce no-fault benefits in some states. Benefits that a victim receives from one insurance policy, such as accident insurance, can lower the benefits owed by the no-fault insurer.

Medical Expenses

To recover medical expenses, the insured victim has to show that the medical condition or problem was connected to his or her use of a motor vehicle. Most courts use a test that mixes being at or near the site of the accident and strict proximate cause in tort - showing a direct and near-immediate connection between the injury and the accident.
For example, a victim usually will be denied medical expenses that resulted from an accident where he exited his car, took several steps away from the car, tripped, and fell on the curb of a parking lot, breaking his leg. But, a driver who was injured when she stumbled into a hole in the driveway immediately after she exited, "or "alighted," from her car, usually will recover medical expenses.
In addition, to be recoverable, most no-fault laws require that the medical expenses be "reasonable and necessary." This issue arises most often when the insurer questions the amount of medical expenses or the type of medical treatment, that is, the insurer thinks he expense is too high, or that the victim could have obtained other, less expensive treatment.
Under some PIP laws, there is a presumption that medical expenses are reasonable and necessary when certain evidence is presented, such as a medical bill. Other laws specify what is reasonable and necessary by setting the charges for diagnosis, treatment and rehabilitation of injured persons, or by adopting the fee schedule and guidelines found in the state's workers' compensation laws and regulations.

Work Loss Benefits

Typically, no-fault statutes provide only for the recovery of wages actually lost, as opposed to also providing for lost earning capacity - the future ability to earn.
As a general rule, in order to qualify for work loss benefits, the injured person must have been employed or employable at the time of the injury and he or she must have suffered an actual or real loss of earnings, that is, the loss is easily measured and certain. Remember too that this type of benefit might only be payable for a certain amount of time after the accident.

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Some states have "no-fault" auto insurance - also called "personal injury

Some states have "no-fault" auto insurance - also called "personal injury protection" or "PIP" - where the insurance company ("insurer") automatically pays, regardless of fault, for certain losses or damages sustained by an accident victim who was covered by the insurer's policy. PIP benefits are designed to reduce the wrongful death, personal injury, and property damage lawsuits that result from motor vehicle accidents.
With that purpose in mind, some no-fault insurance plans include protection for property damage, in many ways similar to the protection provided by the conventional motor vehicle liability insurance that most of us are familiar with and buy. These statutes usually specify what types of property are and are not covered, as well as how to claim benefits.
However, most states have either specifically excluded or do not discuss property damage claims in their no-fault statutes, and so claims for property damage are left to the traditional tort system - that is, you need to file a lawsuit against the other person to recover damages for your loss.
So, if you've been in a car accident and you've suffered property damage, it is very important that you know how your state's no-fault law treats claims for property damage.

Property That Is Covered

The most common type of property damage covered under no-fault statutes that provide for such coverage is non-vehicular property damage. The coverage usually applies to real property, or land, as well as personal property. For example, coverage will usually include damages to things like buildings and even livestock.
In addition, while the typical no-fault property damage laws don't cover damages to motor vehicles that were moving at the time of an accident, insurers usually will pay for damages to vehicles that are damaged while properly parked. The only requirements are that:

• The vehicle was safely parked, and
• It did not pose any significant or unusual risk that caused the damage

Property That Is Not Covered

Damage to motor vehicles involved in accidents and their contents is the prime exclusion in the majority of no-fault laws which provide property damage coverage. However, some laws just limit the amount that can be recovered for damages to a moving car involved in an accident.
Normally, car owners who want to be paid for property damage to their vehicles have to buy separate collision insurance coverage.
It is necessary that you understand how your state no-fault law treats or defines "vehicles." Under some statutes that provide coverage for property damage, things like motorcycles, trailers, and bicycles are vehicles, and are excluded from coverage. So, you won't be able to recover under the no-fault property damage provisions if such a vehicle is damaged in an accident.
Illegally or improperly parked vehicles generally will not be covered by property protection insurance.

Claiming Benefits

If, as a result of a car accident, you've suffered damage to real or personal property and you think the damage is covered under the property insurance provisions of your liability insurance policy and state laws, you should file a claim with the driver or car-owner's no-fault insurance carrier.
The forms needed to file claims for benefits usually are available from the insurer, and most statutes require the insurer to handle the claims quickly. Generally, benefits are overdue if not paid within 30 days after the insurer receives written notice that the damage happened and the amount of the loss.
The person claiming benefits might have to show that he or she actually owns the property that was damaged. In addition, he or she usually has to figure out the amount of the loss or damage. There are several ways to measure the amount of property damage, such as:

• Reasonable costs of repair
• Replacement value
• Market value
• Actual cash value
• Cost, minus depreciation, which is the loss of value that is due to use, or wear-and-tear

When filing a claim, it is important to remember that the insurance policy might limit the amount that the insurer has to pay.

For example, a policy might state that "the amount that will be paid for all damage to real or personal property in a single accident will not exceed $ 100,000."

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Under a "no-fault" auto insurance system - also known as "personal injury protection

Under a "no-fault" auto insurance system - also known as "personal injury protection" or "PIP" - the insurance company ("insurer"), automatically pays for some of a car accident victim's losses, including "death benefits," which include things like funeral and burial expenses.

These payments are made regardless of who was at fault for the accident.

In addition, some death benefits are often called "survivors benefits," because they are paid to the family or "dependents" the deceased person ("decedent"). These include:

• Accidental death benefits
• Continuation of lost earnings
• Periodic "pension" payments, and
• Replacement services payments

To recover no-fault death benefits, the decedent's death has to be directly and clearly connected to the use or operation of a motor vehicle.

Although the availability these benefits vary from state to state, most no-fault laws place limits on the amount of death benefits that will be paid. In addition, there are special rules for when payments will stop, as well as for claiming benefits.

Funeral and Burial Expenses

Most no-fault insurance plans specifically provide coverage for the ordinary funeral and burial expenses of any person who was accidentally killed as a result of the use or operation of a motor vehicle.

In some states, reasonable funeral expenses are protected benefits and have to be paid even when the insurance policy's other benefits - like medical expenses - have been paid to the policy limits.

Survivors' Benefits

Several types off no-fault "death benefits" are paid to the family or relatives of the insured who died in a car accident. In many states, the amounts payable as survivors' benefits are limited by the no-fault law of that state. For example, some states will allow payments for funeral expenses plus the decedent's medical expenses but will not allow payments for lost income.

Accidental Death

These benefits are paid only when the death is in fact "accidental," so if an insured commits suicide, which is generally considered to be an intentional act, no accidental death benefits will be paid.

An "accident" is generally defined as an event, which under the circumstances is unusual and unexpected by the person to whom it happens.

Income Continuation Payments

No-fault statutes generally take one of two approaches when it comes to paying for the decedent's lost income:

• The survivors will continue to receive the lost income benefits that would have been paid to the decedent if he had not died, including wages he should or would have earned in the future, or
• The survivors will be paid only what the decedent lost during his lifetime - the time, if any, between the injury and death - without regard to future wages, that is, wages that he or should would have earned if he or she had not died

Under either approach, income continuation payments are usually denied when the insured-decedent was unemployed when he or she died.

"Pension" Payments

Another benefit found under no-fault insurance laws is for "pension payments," also known as "survivors' economic benefits." This is a disability and income payment that is limited to cases where the insured has not been fatally injured, and like income continuation payments, replaces lost income. A key element of these payments is that they are designed to replace real, material goods that the insured would have provided if he or she had not been injured.

Under some no-fault laws, this benefit is applied if the insured dies as a result of the injuries he or she sustained in a car accident. So, if the insured dies, the survivors would receive payments for the purpose of replacing goods that the decedent would have provided if he or she had not died.

Usually, and unlike income continuation benefits, the statutes that provide for this benefit do not require that the insured be employed at the time of the injury or death.

Replacement Services

A household's loss of an adult or older child usually includes the loss of certain services performed by the decedent, which might be crucial to the household. Things like lawn mowing, cooking, and home maintenance that were done by the decedent might have to be done by hired help. So, many no-fault plans provide for replacement services coverage to cover such costs.

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Some states have "no-fault" auto insurance - also called "personal injury protection

Some states have "no-fault" auto insurance - also called "personal injury protection" or "PIP" - where the insurance company ("insurer") automatically pays, regardless of fault, certain losses or damages sustained by an accident victim who was covered by the insurer's policy or was injured by someone covered by the insurer's policy (the "insured"). These damages are called "economic damages," and include things like medical expenses and funeral costs.
But what about "non-economic" losses or damages, like pain and suffering and loss of consortium, which is the loss of a spouse's companionship?

When Can You Sue?

A lot of the states' no-fault laws have no restrictions on when you can file a "tort action," that is, a private civil lawsuit against the wrongdoer or "tortfeasor," for non-economic damages.
However, there are some states that place limits or "thresholds" on when the tortfeasor can be sued. These thresholds are typically based on:

• The amount of medical expenses that the injured person has paid or has been billed for payment, known as the "monetary threshold," or
• The type of injury that the victim suffered, known as the "injury threshold"

The main idea of using thresholds is to prevent lawsuits over every single injury, and to limit the suits to "serious injuries." However, state no-fault laws differ on what exactly is "serious."
In addition, not all states use the term "non-economic loss," but could use terms like "pain and suffering," "mental anguish," "other nonpecuniary loss" or "non-monetary detriment."
So, if you've been injured in a car accident, it is vital that you understand your state's no-fault laws and how they treat non-economic damages.

Monetary Threshold

Many states that limit tort actions for non-economic loss include a monetary medical expense threshold in their definition of "serious injury." The monetary thresholds vary, but are usually at least $1,000.
Most no-fault statutes allow the monetary threshold to be met only from expenses "accrued," "rendered" or expenses "incurred." In other words, the expenses have to have been paid by or billed to the victim when the suit is filed, or there must be proof that the threshold will be met by the time the lawsuit goes to trial. The victim can't use future, uncertain expenses to meet the threshold.
No-fault laws require that the injured person's medical expenses be "reasonable and necessary." In some states, a medical bill will be enough to show that an expense was reasonable and necessary. In most states, however, the injured person has to have a doctor testify that the treatment and the accident were connected, that is, the accident made the treatment necessary.
Some states have mathematical formulas that are used to determine if an expense is "reasonable," while many states specifically define the types of medical expenses that can be used to determine whether the threshold has been met. These include things like:

• Hospitalization
• Surgery and
• X-rays

You need to check the law in your area to see if your medical expenses can be used to meet the threshold.

Injury Threshold

Where lawsuits are allowed under no-fault laws, the victim of a "serious" injury still has the right to sue the tortfeasor even if the victim recovers PIP benefits. However, state no-fault laws are not consistent on the meaning of "serious" injury.
Death is a "serious" injury under all no-fault laws allowing for lawsuits against the other driver, and so if an insured dies due to a car accident, his or her survivors can file a lawsuit against the tortfeasor even though PIP benefits, like funeral expenses, were paid.
Most no-fault laws include a list of serious injuries, and state laws vary in the terms used to describe injuries. In general, however, "serious" injuries usually include things like:

• Permanent "disability," "injury" or "loss of a body function"
• Dismemberment, or the "loss of a body member," like an arm or an organ
• Fractures, or bone breakages
• Permanent or "significant" disfigurement

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After you've been in a car accident and reported it to your insurance

After you've been in a car accident and reported it to your insurance company, one of the first things that happens is getting an estimate for repairs to your car. An estimate is the amount of money that an insurance adjuster believes will restore the car to its pre-accident condition. There are a few important steps to this process.

1. Adjuster or Inspector. Your insurance company will usually have a qualified adjuster or inspector look at your vehicle and draw up an estimate of what it will cost to repair it. Rather than send an adjuster to your home or business, they may also send you to specific centers to review your vehicle.

If the damage is minor they will ask you to get estimates from several mechanics or body shops for the cost of repairs. However, if the estimate is less than your deductible, you will end up paying for repairs yourself.

Even if you think your damages may cost less than the deductible, it doesn't hurt to make a claim. If you end up injured or find additional damage related to the crash later on, the insurance company will cover that, too.

2. Mechanic or Body Shop. Choose a mechanic or body shop you trust. Your insurance company may suggest one, but you're also free to choose your own. If your insurance company asks you to provide estimates from multiple repair providers they can then choose which of those you'll go to. If it's important that you see your regular mechanic, make that clear.

Remember: Your insurance company can't force you to work with a particular mechanic they might have a partnership with. Listen to any suggestions, though. They have as much at stake in getting your car fixed correctly the first time around as you do.

3. Additional Damage. During the course of repairs, the mechanic may find additional damage and will contact the insurer. An adjuster may re-inspect the vehicle and reassess the cost of repair given the additional damage. This is a fairly common situation as many times certain types of damage aren't apparent until after repairs have started.
4. Cost of the Repairs. You'll also want to find out what type of parts will be used in the repair estimate. Many insurance companies ask that mechanics repair your car with a used or aftermarket parts. However, you can request a new part, but you may have to pay the difference in price.

You may also wish to have additional work done on your car at this time for damages unrelated to the accident, but you'll have to pay for that directly.

5. Appraisal Provision. If you and your insurer can't agree on the amount the repairs, find out if your insurance policy has an appraisal provision. An appraisal provision describes how disagreements on the value of a loss are resolved. Typically, this directs you and your insurer to each hire appraisers. The respective appraisers will then select a "neutral umpire," who will also be an appraiser.

All of the appraisers review your claim information, and if they can't agree on the value of your loss, the claim information will be submitted to the umpire. The amount that two of the three of them agree on is the value of your claim. The decision on the value of your claim is binding.

The insurance company is responsible to return your car to the state that it was prior to the accident. However, don't expect them to pay for a problem that was present before the accident. Restoring your car to pre-accident shape doesn't mean they have to make it perfect, only as good as it was right before the accident.

They also can't refuse to pay for additional damage found while the mechanic was working on your vehicle as long as it was related to the accident.

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