Massachusetts No-Fault Auto Insurance: Understanding The System

Massachusetts is a no-fault state when it comes to car insurance. This means that your own insurance covers your medical bills and certain other losses after a car accident, regardless of who caused the crash. In Massachusetts, you must have $8,000 of Personal Injury Protection (PIP) coverage, which will pay for medical treatment and other out-of-pocket losses incurred by anyone covered under the policy, up to the coverage limits. This includes the owner of the vehicle, anyone with permission to drive the vehicle, any passengers, and any pedestrians injured.

Personal Injury Protection (PIP)

PIP does not cover everything, and there are situations in which it will not be applied. For example, if the injured party was operating a motorcycle, racing, committing a felony, or seeking to harm themselves or others, PIP will not apply. It is also important to note that PIP is not a substitute for liability insurance, which covers damage to another person's vehicle if the policyholder causes a crash.

Medical Expenses

In Massachusetts, no-fault car insurance covers medical expenses and certain other losses after a car accident, regardless of who caused the crash. This is known as Personal Injury Protection (PIP) coverage.

PIP coverage will pay for medical bills stemming from the car accident, up to 75% of lost income due to your inability to work, and "replacement services" (e.g. someone to take care of household chores that you're unable to perform because of the accident). The limit for PIP coverage in Massachusetts is $8,000. It's important to note that PIP coverage does not include compensation for "pain and suffering" or other non-monetary damages.

If you have health insurance, PIP benefits will only cover up to $2,000 in medical bills. To qualify for PIP benefits, medical expenses must be incurred within two years of the crash. In some cases, the insurer may require you to be examined by an "independent doctor" (chosen by the insurance company) to confirm that continued treatment is necessary. Refusing to submit to this examination could result in a loss of benefits.

In Massachusetts, funeral expenses are also covered by PIP benefits. This is an important benefit for families who have lost a loved one unexpectedly and need help covering these costs.

In certain situations, you may be able to step outside of the no-fault system and pursue a claim against the driver who caused the car accident. This can be done if the injured person has incurred at least $2,000 in reasonable medical expenses and/or if the injuries include permanent and serious disfigurement, bone fracture, or substantial loss of hearing or sight. In these cases, you can hold the at-fault driver responsible for the accident and pursue compensation for all categories of losses, including pain and suffering, and other non-economic damages that are not available in a no-fault/PIP claim.

Income Loss

In Massachusetts, if you are involved in a car accident, your own insurance will cover your medical bills and other losses, regardless of who caused the crash. This is because Massachusetts operates a "no-fault" car insurance system.

Under this system, your "personal injury protection" or "PIP" coverage will pay for medical treatment and other out-of-pocket losses incurred by anyone covered under the policy, up to a limit. This includes:

• You (the owner of the vehicle)
• Anyone who has your permission to drive your vehicle
• Any passenger riding in your vehicle
• Any pedestrian injured by your vehicle

In terms of income loss, your Massachusetts PIP coverage will pay for up to 75% of lost income due to your inability to work, up to a limit of $8,000. Wage losses are paid at a rate of 75% of the insured's average weekly wage, based on what you earned in the year prior to the accident. This amount is not taxed.

If you use sick or vacation time to cover expenses in the immediate aftermath of an accident, you may be entitled to a buy-back of the benefit. However, your PIP won't reimburse you if your employer pays you regular wages or if you receive workers' compensation benefits. A lost wage benefit requires a doctor-supported diagnosis of temporary or permanent disability, either partial or total.

Vehicle Damage Claims

In Massachusetts, vehicle damage claims are not covered by the no-fault insurance system. This means that if your vehicle is damaged or totaled in an accident, you can file a claim directly against the at-fault driver's liability coverage with no limitations.

If your vehicle is damaged in an accident, you may be concerned about getting it repaired or replaced. Here's what you need to do:

Understanding Your Insurance Coverage

Before filing a claim, it's important to understand your insurance coverage. Review your policy to know what is covered and what your deductibles are. As the owner of the vehicle, your no-fault or Personal Injury Protection (PIP) coverage will apply to you. However, since Massachusetts's no-fault system doesn't cover vehicle damage claims, you'll need to look into other types of coverage for repairs or replacement of your vehicle.

Collision and Comprehensive Coverage

If you want insurance coverage for repairs or replacement of your damaged vehicle, you'll need to purchase additional coverage. Collision coverage pays for damage to your vehicle caused by a collision with another vehicle or object. Comprehensive coverage pays for damage caused by something other than a collision, such as vandalism, fire, theft, falling objects, or contact with an animal. These coverages are optional in Massachusetts, but if you lease or finance your vehicle, you may be required to add collision coverage to your policy.

Filing a Claim

If your vehicle is damaged in an accident, you can file a claim with the at-fault driver's insurance company. This is known as a third-party insurance claim. Provide accurate information about how the accident happened, as giving false information may result in your claim being denied. You can also consult with an attorney, especially if you plan to pursue action outside the no-fault system.

Original Equipment Manufacturer (OEM) Parts

If the damage to your vehicle affects its safe operation, your insurance company will pay to repair it with OEM parts. For non-safety parts, unless your claim occurs during the first 20,000 miles on the odometer, the insurance company is not required to pay for OEM parts. For vehicles with more than 20,000 miles, state regulations allow for the use of used, reconditioned, or aftermarket parts. You can insist on OEM parts, but you'll have to pay the difference in cost.

Rental Car or Substitute Transportation

If your vehicle is in the shop due to an accident, you may need a rental car or other substitute transportation. If you're found not at fault for the accident, you can open a third-party claim with the at-fault party's policy under "Damage to Someone Else's Property." If you're at fault and have purchased optional "Substitute Transportation" coverage, you can open a claim with your own insurance policy.

Total Loss and Actual Cash Value

If your vehicle is declared a total loss, it means the cost to repair it exceeds its current value. In this case, your insurance company will pay you the "actual cash value" of the vehicle, not the cost to replace it. The value is determined by factors such as the retail value of a similar vehicle, the price you paid for the vehicle, and any improvements made to it. If you disagree with the amount offered by the insurance company, you can attempt to negotiate by providing supporting documentation.

Keeping Your Vehicle After a Total Loss

In some cases, you may want to keep your vehicle even if it has been declared a total loss. Your insurance company has the option to take title to the vehicle when they pay your claim, but you can negotiate with them to buy back the vehicle for its salvaged value.

Diminished Value Claims

If your vehicle has been fully repaired after an accident, you may be able to file a diminished value claim to recover the loss in value due to the accident. However, this depends on the insurance policy of the at-fault driver. In Massachusetts, the Standard Massachusetts Automobile Insurance Policy from 2008 may allow for diminished value claims, but policies from 2016 or other forms may have different language and exclusions. Consult with an attorney to understand your options.

First-Party Benefits

• Medical expenses
• Up to 75% of lost wages
• Replacement services
• Funeral expenses
• Ordinary and necessary household services

Massachusetts is a "no-fault state", meaning that your own insurance covers your medical bills and certain other losses after an accident, regardless of who caused the crash. This includes medical treatment and other out-of-pocket losses incurred by anyone covered under the policy, up to coverage limits.

In Massachusetts, no-fault insurance, also known as personal injury protection (PIP), will pay these expenses for you or anyone you let drive your car, anyone living in your household, passengers in your vehicle, and pedestrians.

It's important to note that with no-fault insurance, you cannot get compensation for "pain and suffering" and other non-monetary damages resulting from the accident. If you want to pursue compensation for these types of losses, you must step outside of the no-fault system and file a third-party insurance claim or lawsuit against the at-fault driver. To do this, your injuries must meet certain thresholds set by state law, including incurring at least $2,000 in reasonable medical expenses and/or injuries that result in permanent and serious disfigurement, fractured bone, or substantial loss of hearing or sight.

Frequently asked questions