Who Pays for Car Damage in a No-Fault State

New York and New Jersey are both no-fault car insurance states. However, car owners in New Jersey can opt-out of no-fault coverage and instead procure traditional liability insurance. In both states, if the owner does carry no-fault insurance that includes collision coverage, their coverage will pay for car damage, subject to deductibles and policy limits.

The car accident lawyers at Kantrowitz, Goldhamer, Graifman, Perlmutter & Carballo, P.C. help New York and New Jersey residents get the maximum available payments from their no-fault insurance policies. We also help drivers recover the full measure of their other damages, including reimbursements for medical expenses and lost wages.

How does no-fault car insurance work?

States created no-fault car insurance to eliminate the need for a car owner to pursue a negligent driver for vehicle repairs and personal injury damages. The car owner reports the accident to their no-fault insurance carrier, which pays the owner directly for repairs to the car regardless of who caused the accident, within the limits of the policy’s coverage. No-fault insurance premiums may be higher than those in states that do not have a no-fault system. However, the payments are typically disbursed more quickly, with fewer administrative problems or delays.

Will no-fault insurance pay for all damage to my car?

No-fault insurance will pay for the costs of vehicle repairs only if collision damage is included in the policy. Many drivers of older cars opt-out of collision coverage. In this case, the owner will either have to pay for vehicle repairs directly or seek reimbursement from the negligent party. Further, collision coverage often includes deductibles that require the owner to pay for the first $500 to $1,000 in damages to the car.

What happens if my car is totaled in an auto accident?

If your no-fault insurance includes collision coverage, your insurance company will reimburse an amount equal to the value of the vehicle before the accident. Often, the insurance company will use a low estimate and pay a more limited reimbursement than the owner expects. In other situations, the value of the car might be less than an outstanding loan on it. If this is the case, the owner will be responsible for the reimbursement amount and the balance of the loan.

Car owners whose vehicles are damaged in accidents will have a better chance to recover the total cost of vehicle repairs or replacements when they consult with car accident lawyers. They have extensive experience with no-fault accident claims.

Can I sue a negligent party if my no-fault insurance does not cover all of my car damage?

No-fault insurance is primarily designed to cover personal injury claims and reimburse an injured driver’s medical costs and expenses apart from any lawsuits. Drivers in New York who suffer a “serious injury” as defined under Insurance Law §5102(d) may have an opportunity to file a lawsuit against a negligent driver for pain and suffering and other damages beyond their no-fault coverage. As of May 26, 2026, New York also bars a plaintiff found more than 50% at fault for the accident from recovering these non-economic damages, so how fault is allocated can directly affect what a driver is able to collect.

No-fault insurance does not limit claims for property damage. Even if a car owner carries no-fault insurance, they can sue a negligent driver for property damage and losses. However, before the owner files that lawsuit, they should consult with an attorney to determine if the lawsuit can also include personal injury claims.

How New York’s 2026 Comparative Fault Rules Affect Your Claim

As of May 26, 2026, New York law bars a plaintiff found more than 50% at fault for a motor vehicle accident from recovering non-economic damages, such as pain and suffering. You may still be able to recover a proportional share of your economic damages, such as medical bills and lost wages, but pain and suffering compensation would not be available. The law also eliminated the “90/180-day” rule, under which a temporary injury lasting at least 90 of the 180 days following an accident could, on its own, qualify as a “serious injury” for purposes of filing a lawsuit. These changes apply to actions commenced on or after that date and affect how much compensation an injured driver can ultimately recover.

Call the Car Accident Attorneys at Kantrowitz, Goldhamer, Graifman, Perlmutter & Carballo, P.C. for a free consultation

If your car was damaged in an auto accident in Rockland or Bergen Counties, or elsewhere in New York or New Jersey, please see our website or call Kantrowitz, Goldhamer, Graifman, Perlmutter & Carballo, P.C. We offer a complimentary consultation with a car accident lawyer. They will help you navigate your no-fault insurance claims and your demands for reimbursement of your other costs and expenses.