There are a number of different ways that no-fault states handle car accident lawsuits. Some states, such as Indiana, have a modified no-fault system in which drivers can file a lawsuit for certain types of injuries. Other states have a pure no-fault system in which drivers can only file a claim with their insurance company. There are also a number of states that have a combination of the two systems.
No-fault states handle car accident lawsuits differently because they have different insurance laws. In a no-fault state, drivers are required to have personal injury protection (PIP) coverage. This coverage pays for the driver's medical expenses and lost wages regardless of who is at fault in the accident. PIP coverage also protects the driver's family members if they are injured in an accident.
Because no-fault states have these insurance laws, drivers are not allowed to file a lawsuit against the other driver in most cases. The only exception is if the driver suffers a serious injury, such as a broken bone or a head injury. In these cases, the driver can file a lawsuit against the other driver.