Pennsylvania’s Unique Automobile Insurance System, Part 1

In choosing a personal injury attorney, important considerations include the attorney’s record and reputation for resolving personal injury matters. Powell Law has an established 113-year history throughout northeastern Pennsylvania of securing favorable verdicts and settlements for those who have been hurt in any type of accident. Most importantly, we are rated highly by our former clients and other distinguished attorneys.

In 1974, the Pennsylvania Legislature adopted a no-fault insurance system with unlimited medical benefits and several thresholds for drivers. Some of these thresholds included a monetary threshold of $750 in medical and dental expenses and verbal thresholds for terms such as death and serious and permanent injury/disfigurement. Meeting these requirements allowed plaintiffs to recover for non-economic injuries, such as pain and suffering.

Pennsylvania repealed the no-fault law in 1984 and replaced it with an add-on system that required motorists to purchase mandated first-party coverages, but with no restrictions on allowable damages. As the automobile insurance industry perceived an increasing number of pain and suffering lawsuits in Pennsylvania courts were causing lower profits, the industry responded by raising the rates of automobile insurance in Pennsylvania.

Further attempts to reduce claims for nonmonetary damages such as pain and suffering, which were historically harder to prove than bodily tissue injuries and thereby conducive to fraud attempts by dishonest plaintiffs, resulted in the Pennsylvania Legislature passing HB 121 (1990 Act 6).

This 1990 amendment to the Pennsylvania Vehicle Code 75 Pa. C.S. instituted the system of auto insurance unique to the Commonwealth of Pennsylvania still used currently in 2019. Since 1990, the Pennsylvania Motor Vehicle Financial Responsibility Law (MVFRL) has required that insurance carriers issuing private passenger motor vehicle insurance policies for vehicles registered in Pennsylvania offer a less expensive alternative to resident motorists.

This resulted in insurance companies offering “limited-tort” insurance coverage and “full tort” insurance coverage as options for Pennsylvania motorists. On the one hand, Pennsylvania drivers could purchase a cheaper auto insurance policy, but, on the other, they sacrificed certain benefits in the event of an accident.

Many lawyers and laypersons look at this as “you get what you pay for.” Saving a few dollars on monthly premiums may not be worth sacrificing the right to sue for certain damages in the event of a serious accident. More about this in part two, stay tuned.

The assessment of damages and applicable insurance coverage is important in any personal injury matter. If you or a loved one has been injured in any type of accident, contact Powell Law at (570) 961-0777. Our decades of experience make us the clear and obvious choice for all types of legal representation in the Scranton/Wilkes-Barre and surrounding areas. The consultation is FREE, and you don’t pay anything unless we win. Our attorneys, past and present, have represented motor vehicle accident victims for 113 years. Call today!

Pennsylvania’s Unique Automobile Insurance System, Part 1

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