What is no-fault insurance?

No-fault insurance is a system of insurance where individuals involved in an accident are compensated for their injuries and damages without regard to who was at fault. This means that policyholders can receive payments for medical expenses, lost wages, and other related costs directly from their own insurance company, regardless of whether they caused the accident or not.

This type of insurance is designed to streamline the claims process and reduce the potential for litigation, as it minimizes the need for proving fault in an accident. It provides quick access to coverage for medical costs and can lead to a more efficient resolution of claims. Consequently, the emphasis is placed on ensuring that those injured receive necessary support, rather than assigning blame, which can often be a lengthy and contentious process.

In contrast, the other options describe circumstances that do not align with the principles of no-fault insurance. For instance, options that involve paying for damages caused or requiring proof of negligence indicate policies that depend on determining fault rather than providing straightforward compensation based on the fact of injury. These are more characteristic of traditional liability insurance or other forms of coverage that engage in assessment of fault.