What Is Tort Auto Insurance?

The Tort system makes the driver who is at fault in an accident responsible for paying for the victim’s medical bills and property damage incurred, as well as providing compensation for pain and suffering and eventual loss of wages.

The Tort system operates in 38 states: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Vermont, Virginia, Washington, West Virginia, Wisconsin and Wyoming. The other twelve states have opted for various forms of no-fault insurance systems.

Residents from Kentucky, New Jersey and Pennsylvania are allowed to choose between full-tort and limited-tort insurance when contracting or renewing a policy. The difference is that, under the limited tort system, the victim waives the right to receive compensation for pain and suffering. The full-tort system, on the other hand, allows you to sue for any compensation you deem fit.

Choosing a limited tort policy would basically mean that you are giving up your full protection for the sake of (around) 15% of your premium. Nevertheless, a full-tort policy could save you thousands in the long run by relieving you of financial stress during a hard time.

Policyholders from KY and NJ who don’t specifically opt for one of the forms will be assigned a limited-tort policy, while the default in PA is full-tort.