Kentucky No-Fault Car Insurance Rules | Nolo

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Understanding the No-Fault System in Kentucky

Kentucky adopts a “no-fault” approach when it comes to auto insurance coverage and injury claims following a car accident. Here’s everything you need to understand about this system:

  • In a no-fault auto insurance setup, your own insurance policy will cover medical expenses and other financial losses resulting from a car accident, regardless of who caused the accident.
  • It’s important to note that you have the option to opt out of the Kentucky no-fault system, which preserves your right to sue the at-fault driver for compensation after a car accident.
  • Kentucky law mandates that vehicle owners carry specific minimum amounts of auto insurance, including liability coverage.

Exploring “No Fault Choice” Car Insurance in Kentucky

Kentucky is among a handful of states that implement some variation of no-fault auto insurance for car accident injury compensation. In a traditional no-fault state, each driver relies on their own auto insurance policy to seek compensation for medical bills and other financial losses arising from an accident, regardless of fault. It’s important to note that liability cannot be claimed against the at-fault driver, except under specific circumstances that allow for a no-fault exemption, which we’ll discuss later.

Reading: How does no fault insurance work in kentucky

Unpacking the Coverage Offered by Kentucky No-Fault Auto Insurance

In Kentucky, no-fault benefits are provided in the form of “personal injury protection” (PIP) benefits. These benefits cover expenses up to $10,000, encompassing:

  • Medical bills resulting from injuries sustained in a car accident
  • Lost wages
  • Out-of-pocket costs resulting from the accident, such as hiring someone to perform household tasks you are unable to manage due to injuries.

It’s worth mentioning that higher benefits beyond the base amount of $10,000 can be obtained at an additional cost when purchasing a Kentucky auto insurance policy.

Determining Who Is Covered by Kentucky No-Fault Car Insurance

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In the event of an accident, pip benefits in Kentucky aren’t limited to just the policyholder. Other individuals covered include:

  • Anyone driving or riding in the vehicle at the time of the accident
  • Pedestrians or bicyclists struck by the covered vehicle.

The Choice to Reject No-Fault Car Insurance in Kentucky

Vehicle owners in Kentucky have the option to “opt out” of the no-fault system when selecting and purchasing an auto insurance policy. By opting out, the policy purchaser retains the right to file a liability claim or personal injury lawsuit against the at-fault driver.

However, it’s important to consider that by opting out, the policyholder also exposes themselves to the risk of being sued if found at fault for the accident. This is why Kentucky’s system is known as a “no-fault election.” Keep in mind that by electing no-fault, you are not entitled to your own insurer’s mandatory first-party PIP benefits.

To officially opt out of the system, a written denial must be submitted using a special form filed with the state insurance department. This denial remains in effect until the Department of Insurance is notified in writing of any changes to the driver’s automobile insurance elections.

It’s also worth noting that if all members of a household file no-fault denials with the insurance department, any auto insurance policy on a family vehicle must include “guest” PIP coverage. This coverage applies to passengers or pedestrians who are injured in an accident involving the family vehicle.

Understanding the Kentucky No-Fault Thresholds

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Even if a vehicle owner chooses no-fault coverage, there are situations where they may be exempt from the no-fault rules, making a claim against the at-fault driver possible. This exemption occurs if your auto accident injury claim meets the following thresholds:

  • The accident resulted in at least $1,000 in medical bills
  • The accident caused permanent disfigurement, fractures to weight-bearing bones, compound fractures, compressed fractures, displaced fractures, any permanent injury, or permanent loss of bodily function.

Does Kentucky No-Fault Insurance Apply to Vehicle Damage?

It’s important to clarify that the no-fault auto insurance rules discussed thus far only cover claims for injuries sustained in a car accident. If your vehicle is damaged in an accident, you have the option to make a vehicle damage claim against the at-fault driver. This can be done by filing a third-party car insurance claim through the driver’s insurance company or by pursuing a small claims lawsuit.

Understanding Car Insurance Requirements in Kentucky

In addition to PIP coverage, Kentucky requires vehicle owners to maintain minimum amounts of “liability” auto insurance. This insurance covers injuries and vehicle damage suffered by others when you are at fault for an accident. The minimum liability coverage requirements in Kentucky are as follows:

  • $25,000 for injuries per person, in a single accident caused by you
  • $50,000 total for all injuries resulting from a single accident caused by you
  • $10,000 for property damage resulting from any accident caused by you.

It’s important to note that you can always purchase an auto insurance policy with higher liability limits. If you are found at fault in an accident and the injured person’s losses exceed your coverage limits, you will be required to cover the difference using your own assets.

To learn more about Kentucky auto insurance, you can visit the state insurance department’s website. If you have been involved in a car accident, especially one that resulted in serious injuries, it may be beneficial to understand your legal options under Kentucky law. Consider consulting with an attorney who specializes in car accident cases or use the tools on this page to connect with a car accident attorney in your area. By answering a few questions about your situation, you can receive a free case evaluation.

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