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Tort Liability System

The document discusses different types of auto insurance systems including tort liability, financial responsibility laws, compulsory insurance laws, uninsured motorist coverage, underinsured motorist coverage, no-fault insurance plans, and factors for determining auto insurance rates.

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aljdummy
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18 views4 pages

Tort Liability System

The document discusses different types of auto insurance systems including tort liability, financial responsibility laws, compulsory insurance laws, uninsured motorist coverage, underinsured motorist coverage, no-fault insurance plans, and factors for determining auto insurance rates.

Uploaded by

aljdummy
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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the traditioanl and most commonly used

method of seeking compensation for


injured auto accident victims; injured
Tort Liability System auto accident victims must prove that
another party was at fault before they
can collect damages from taht party

laws that require individuals who


drive cars to purchase a minimum
Financial Responsibility
amount of liability insurance. Proof
Laws is not required until accident or
loss has occurred.

laws that require you to carry


certain types of automobile
Compulsory insurance
insurance before your car can
laws be licensed. Require proof
before accident

compensates an insured for


bodily injury caused by an
Uninsured motorists
uninsured motorist, hit and
coverage (UM) run driver, or driver whose
insurer is insolvent

Provides additional limits of


protection to the victim when
Underinsured Motorist
the negligent drivers
Coverage insurance limits are
insufficient
accident victims collect
damages from their own
No-fault insurance
insurer without having to
prove negligence.

accident victims cannot sue at


all, regardless of the amount
pure no-fault plan
of the claim. No state has
enacted pure no fault.

an injured person has the


right to sue a negligent driver
modified no-fault plan only if the bodily injury claim
exceeds the monetary or
verbal threshold

In a no-fault system, a dollar


limit in total medical expenses
Monetary Threshold an injured victim must exceed
before he or she is permitted
to sue the other party.

In a no-fault system, the


designated criteria that are
verbal threshold verbally "set forth in the statute
that limit the right to sue." Ex:
Permanent disfigurement
Add's no fault benefits to an
auto insurance policy but
Add-on plans
places no restrictions on the
insureds right to sue

In a no-fault system, a plan that gives


the insured the option, at the time an
auto insurance policy is purchased or
Choice no-fault plan renewed, of choosing whether to be
covered on a no-fault basis. Provides
premium reductions in exchange for
restrictions on right to sue.

Automobile insurance that pays for


medical, hospital, and funeral
Personal Injury Protection
costs of the insured's family and
(PIP) passengers, regardless of fault.
Added by endorsement..

Insurance that is not


ordinarily available from
Residual Market Insurance private insurers and may be
provided by the government.
Provided to high risk drivers.

Private insurers who offer


nonstandard insurance high risk programs may
program impose restrictions and take
other measures to reduce risk
assign auto insurers in the
state their share of high-risk
Automobile insurance
drivers based on volume of
plans insurance they write in that
state.

Organization that designates servicing


insurers to handle high-risk auto insurance
Joint Underwriting business; all auto insurers in the state are
assessed a proportionate share of the losses
Association (JUA) and expenses based on their percentage of
the voluntary auto insurance premiums
written in the state.

A pool in which insurers


Reinsurance facility can assign premiums and
losses for high risk drivers

-Territory
-Use of Auto
Rating Factors -Age
-Gender
-Marital Status

-Driving Record
-Driving Education
-Good Student
Other Rating Factors -Multi-car
-Years of driving
-Credit-based insurance score
-Type of auto

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