If you've ever been confused by the phrase "no-fault insurance," you're not alone. New York is one of only a dozen states that use this system, and it works differently than what most people expect from car insurance. Here's the surprising part: when you're in an accident in New York, it doesn't matter who caused it—at least not at first. Your own insurance company pays for your injuries and losses, regardless of fault. That's what makes it "no-fault."
This system was designed to speed up the claims process and reduce lawsuits, but it also comes with specific rules you need to understand. Whether you're a New York resident shopping for car insurance or you're dealing with the aftermath of an accident, knowing how no-fault insurance works can save you thousands of dollars and a lot of headaches.
What Is No-Fault Insurance in New York?
No-fault insurance, officially called Personal Injury Protection or PIP, is mandatory coverage in New York. Every driver must carry at least $50,000 in PIP coverage per person. This isn't optional—it's required by law, and you can't legally drive in New York without it.
The core principle is simple: when you're injured in a car accident, you turn to your own insurance company first, not the other driver's insurer. Your PIP coverage kicks in immediately to pay for medical bills, lost wages, and other expenses—no matter who was at fault. This means you don't have to wait months while insurance companies argue about liability. You get the medical treatment you need right away.
This coverage applies to you as the driver, all passengers in your vehicle, and even pedestrians struck by your car. If you're injured while walking and get hit by a car, the vehicle's PIP coverage typically pays for your injuries.
What Does the $50,000 PIP Coverage Actually Cover?
That $50,000 minimum isn't just for hospital bills. Your PIP coverage breaks down into several categories, and understanding what's included helps you know what to expect if you're ever in an accident.
Medical expenses are the big one. PIP pays for reasonable and necessary medical costs related to the accident, including emergency room visits, surgery, X-rays and diagnostic tests, physical therapy and rehabilitation, prescription medications, and dental work if your teeth were damaged in the crash. You can even get coverage for treatment by a recognized religious practitioner if that's part of your belief system.
Lost wages are covered at 80% of your actual earnings, up to a maximum of $2,000 per month. This benefit can continue for up to three years from the date of the accident. So if you normally earn $3,000 per month and you're unable to work for two months due to your injuries, your PIP would pay $2,000 per month during that time.
Other necessary expenses get covered up to $25 per day for up to one year. This includes things like hiring someone to help with household chores you can't do while recovering, transportation costs to get to medical appointments, and other reasonable expenses directly related to your injury. It might not sound like much, but $25 a day adds up to $9,125 over a full year—enough to make a real difference if you need help around the house while you heal.
Finally, if someone is killed in an accident, the PIP policy provides a $2,000 death benefit to help cover funeral and burial costs. While this is a modest amount given typical funeral expenses, it provides immediate financial assistance during a difficult time.
The Serious Injury Threshold: When You Can Sue for More
Here's where no-fault insurance gets tricky. Because your own insurance pays for your economic losses, New York law restricts your ability to sue the at-fault driver. You can't sue for pain and suffering after every fender bender—there would be lawsuits everywhere. Instead, the state created what's called the "serious injury threshold."
You can pursue a lawsuit against the at-fault driver for pain and suffering only if you meet one of two conditions. First, if your economic losses exceed the $50,000 PIP limit, you can go after the at-fault driver's insurance for the additional amount. Second, and more commonly, if you sustain a "serious injury" as defined by New York law.
What counts as a serious injury? New York Insurance Law Section 5102(d) spells it out. The most common category is an injury that prevents you from performing substantially all of your usual activities for at least 90 of the first 180 days after the accident. This is called the 90/180 rule. If you're bedridden or severely limited for three months following the crash, you likely meet this threshold.
Other categories include significant disfigurement, bone fractures, permanent loss of use of a body organ or member, permanent consequential limitation of use of a body organ or member, and significant limitation of use of a body function or system. These are medically determined injuries, which means you need proper documentation from your healthcare providers to prove you meet the threshold.
Why does this matter? Because if you don't meet the serious injury threshold, your PIP benefits are all you get for your injuries. You can't sue for pain and suffering, emotional distress, or other non-economic damages. This is the trade-off of the no-fault system: you get paid faster, but you give up some of your right to sue.
Important Deadlines You Cannot Miss
New York's no-fault system has strict deadlines, and missing them can cost you your benefits entirely. These aren't flexible—insurance companies will deny your claim if you're even a day late.
You must file your PIP claim with your insurance company within 30 days of the accident. Not 31 days. Not 30 business days. Within 30 calendar days. This means you need to notify your insurer about the accident and submit the initial claim paperwork within this window.
You also must submit medical bills to your PIP provider within 45 days of receiving treatment. This is important: the clock starts when you get treated, not when you receive the bill from your doctor. If you see a doctor on January 1st, you need to submit that bill by February 15th at the latest.
Practical tip: Don't wait. After an accident, call your insurance company immediately—even if you're not sure how badly you're hurt. Minor injuries can turn into bigger problems days later, and you want your claim on record from day one.
Should You Buy Additional PIP Coverage?
While $50,000 sounds like a lot of coverage, medical costs can add up shockingly fast if you're seriously injured. A single emergency surgery can cost $30,000 or more. Add in follow-up care, physical therapy, and months of lost wages, and you could blow through your PIP limit.
That's why New York allows you to purchase Additional Personal Injury Protection, called APIP. This coverage extends your PIP benefits in increments of $50,000. You can buy $50,000 in APIP for a total of $100,000 in coverage, or even more if you want additional protection.
Who should consider APIP? If you have a high income and would need more than $2,000 per month in wage replacement, if you have a physically demanding job where injuries could sideline you for months, if your health insurance has high deductibles or limited coverage, or if you frequently drive with family members and want to ensure they're protected, additional coverage makes sense.
The cost isn't prohibitive for most people—often just an extra $50 to $100 per year for an additional $50,000 in coverage. Talk to your insurance agent about whether APIP makes sense for your situation.
Getting Started: What to Do After an Accident
If you're in an accident in New York, knowing what to do next can protect your rights and ensure you get the benefits you're entitled to. First, seek medical attention immediately, even for minor injuries. Some injuries don't show symptoms right away, and you need medical records that document when your injuries started.
Next, notify your insurance company within 30 days. Give them the basic facts about the accident and request a PIP claim form. Your insurer should send you the necessary paperwork promptly. Fill out all forms completely and accurately—incomplete forms can delay your benefits.
Keep detailed records of everything: medical bills and treatment records, pay stubs showing lost wages, receipts for transportation to medical appointments, and any other accident-related expenses. This documentation will support your claim and help you maximize your benefits.
New York's no-fault insurance system can seem complicated, but it's designed to work in your favor by getting you benefits quickly when you need them most. Understanding your PIP coverage, knowing the serious injury threshold, and meeting important deadlines can make all the difference in protecting yourself and your family on the road. If you're shopping for car insurance in New York, make sure you understand these requirements and consider whether additional coverage makes sense for your situation.
