Your right to recover for your automobile accident injury is limited by the Comprehensive Automobile Insurance Reparation Act, (the “No-Fault Law”). In 1973, New York State enacted its No-Fault Law for automobile accidents. This law was enacted to speed up the time it takes auto accident victims to receive medical treatment, reduce fraud and to alleviate the courts from an avalanche of auto accident cases. The No-Fault Law essentially created two paths to recover for damages from an auto accident. First, the No-Fault Law is meant to allow accident victims to recover for “basic economic loss” regardless of who is at fault. Second, you can only sue the owner or driver of the car that caused your injury if you have a “serious injury”.

In enacting the No-Fault Law the legislature intended on weeding out frivolous cases and limiting recovery to significant injuries. Consequently, the court requires objective proof of your injury in order to satisfy the statutory “serious injury” threshold. In order to understand the limitations on your right to recover it is important to define three key terms:

• Basic Economic Loss;
• First Party Benefits; and
• Non-Economic Loss.

Definition of Basic Economic Loss

Your lost earnings, medical, remedial and certain health care expense defined by New York Insurance law are defined as basic economic loss. You can recover basic economic loss up to $50,000, excluding loss resulting from death.

Definition of First Party Benefits

First party benefits are paid by the No-Fault insurance company. The first party benefits are paid to you, the injured person, for reimbursement of your basic economic loss.

Definition of Non-Economic Loss

Your pain and suffering and other non-monetary detriment is considered non-economic loss. New York Insurance law limits your recover for non-economic loss unless you prove that you have suffered what the no-fault law defines as a “serious injury”.

Fundamentals of Basic Economic Loss

Basic economic loss covers:

(a) Medical, hospital, psychiatric and other professional health care services;

(b) Loss of earnings from work up to $2,000 per month for no more than three years from the date of the accident;

(c) All other reasonable and necessary expenses incurred, up to $25 per day for no more than one year from the date of the accident.

In sum, unless you purchased additional coverage, the total amount of money available for any no-fault case is $50,000. The $50,000 includes up to $2,000 per month for three years of lost wages. The balance will be apportioned between medical and other necessary expenses.

Fundamentals of First Party Benefits

After the accident you will file your No-Fault claim with the host vehicle No-Fault carrier. You do not have to prove fault in order to receive first party benefits.

Motorcycle operators and their passengers are not eligible to receive No-fault benefits. However, if you are a pedestrian hit by a motorcycle then you are eligible to receive No-Fault benefits. If you intentionally or while under the influence of drugs or alcohol cause an accident you will not be eligible for No-Fault benefits.

In addition, you are not eligible for No-Fault benefits if you are injured while committing a felony, seeking to avoid lawful apprehension, or arrest by a law enforcement officer, or occupying or operating a vehicle known to be stolen.

If the host vehicle or the offending vehicle does not have any insurance coverage then you can seek coverage under any automobile insurance in your household. If neither you nor a member of your household has auto insurance then you should file a No-Fault claim with New York State Motor Vehicle Indemnification Corporation (MVIAC).

If you suffer a “serious injury” as a result of the automobile accident then you can sue for your pain and suffering and economic loss that exceed the basic economic loss.