Is Texas a No-Fault Insurance State?

Is Texas a No-Fault Insurance State?

In the United States, we have no-fault and fault-based car insurance systems. It’s fairly black and white: With a fault-based insurance system, the at-fault driver is responsible for the damages he or she causes in a car accident. With a no-fault insurance system, the injured party files a claim against their own auto insurance carrier, or more specifically with their Personal Injury Protection (PIP) coverage.

However, in a no-fault state, the injured party would seek damages for property damage and pain and suffering from the at-fault driver directly, not through their own auto insurance company. So, is Texas a fault or no-fault car insurance state? Texas, like the majority of states, follows the fault-based system.

According to the Texas Department of Insurance, “Texas law requires people who drive in Texas to pay for the accidents they cause. Most drivers do this by buying auto liability insurance. Liability insurance pays to repair or replace the other driver's car and pays other people's medical expenses when you’re at fault in an accident.”

Filing an Insurance Claim

For a driver in Texas to meet the state’s minimum financial responsibility law, he or she must carry at least 30/60/25 coverage. Since cars can easily cost $20,000 to $50,000 and medical care is expensive, the minimum amounts are often insufficient to cover the costs of an accident.

If you’re injured in a crash and the at-fault driver only carried 30/60/25 and it wasn’t enough to cover your losses, you could sue the driver to collect the difference. As for yourself, we advise buying the highest possible limits you can afford.

We highly recommend that all drivers purchase uninsured/underinsured UM/UIM) coverage in case they are involved in an accident with an uninsured or underinsured driver. If you purchase UM/UIM coverage, it would cover your expenses if you were in an accident with an uninsured or underinsured driver. While insurance companies are required to offer this coverage, it is not required by law. So, if you don’t want it, you have to reject the coverage in writing.