“Tort,” in auto insurance, is a legal term related to liability, claims, reimbursement, and other legal requirements. It’s right to say that tort insurance is where insurance meets the law to serve policyholders and road users.
So, when deciding on car insurance coverage, it’s important to understand tort insurance and the difference between full tort and limited tort. How does tort insurance impact you?
In this post, we’re looking at what limited tort means, how it compares to full tort and how that impacts you.
What Is Tort Insurance?
Tort is known better in the legal field than in insurance.
Tort law involves assigning the responsibility of liability in a car accident to determine the assignment of a penalty to the right person.
In insurance, tort insurance is an automobile insurance system that enables drivers to recover damages from the parties at fault in an accident. It’s important because it allows drivers to be awarded claim settlements when they’re not at fault in the accident.
A tort insurance system emphasizes liability insurance for the at-fault driver to provide coverage for damages, losses, and injuries they might cause. Tort system may require drivers to pay for damages such as:
- Vehicle damage
- Medical bills
- Pain and suffering
- Lost wages
- Potential future costs
- No-Fault Insurance systems
The tort system contrasts no-fault systems, where in addition to liability coverage, drivers must purchase car insurance to cover their medical costs and that of their passengers.
Notably, no-fault systems don’t usually allow drivers to sue other drivers to recover damages for pain and suffering, except for a few exceptions. In most no-fault states, drivers are required to purchase PIP (personal injury protection) to provide coverage for their medical bills, lost wages, and other expenses.
Note: If you aren’t sure, ask your insurance agent whether your state uses a fault or no-fault system to determine liability.
Is Tort Insurance Purchased?
Important to note is that tort insurance isn’t purchased. Tort insurance is the law that regulates how your insurance coverage will handle your case if you get involved in a collision accident.
Choosing the type of tort — limited tort vs. full tort — will determine the extent to which you (the driver) can sue the at-fault driver for damages.
Insurance companies include your choice of tort as a “defined” clause on your car insurance policy. Tort only becomes relevant when you’ve had a collision accident, and you or your passengers have had an injury.
Types of Tort Insurance
There are two types of tort insurance:
- Full tort
- Limited tort
Full Tort Definition
In full tort, insurance drivers have the right to sue the at-fault drivers for pain and suffering damages and receive compensation. If the claim is awarded, the driver will receive full compensation for damages and medical bills caused during the accident, including non-monetary damages.
A full tort policy allows drivers to sue for damages, medical bills, and pain and suffering injuries. Pain and suffering may include:
- Accident related stress and anxiety
- Discomfort and physical pain
- Emotional pain and related treatment
Although drives in full tort insurance expect higher compensation, they also pay higher insurance premiums.
Limited Tort Insurance Meaning
Contrary to full tort, if drivers choose limited tort insurance, it means they waive their right to sue the at-fault driver for their pain and suffering. They cannot also sue the driver for anything else beyond what their insurance coverage can pay.
If the at-fault driver’s insurance is adequate, you will get paid for your medical bills. However, you cannot expect to receive any large sum to compensate for the intangible experience of pain and suffering.
A limited tort policy only allows a driver to sue for damages in the event of severe injuries other than pain and suffering. The insurance bar for severe injuries is high, and some examples include:
- Permanent disfigurement
- Severe body function impairment
In general, limited tort policies don’t provide coverage for all damages that result from a car accident. It limits compensation to monetary damages only, such as medical bills, out-of-pocket expenses, et cetera. This, essentially, limits what policyholders can recover following the accident.
Can You Sue With Limited Tort?
No. If your insurance policy carries limited tort, it means you’ve waived your right to sue the at-fault driver for pain and suffering.
Limited tort holders can sue for pain and suffering unless their conditions are considered a serious bodily injury.
Severed injuries are injuries other than just pain and suffering and can extend for longer periods.
What You Lose With Limited Tort
The idea of waiving your right to recover pain and suffering damages may sound great if your interest is to save on your monthly insurance premium. But it’s important to weigh the amount of money you’re saving vis-a-vee the potential damages.
Other than cuts, bruises, and broken bones, car accidents often leave harmful, lasting effects on victims. These effects can be life-changing.
So, the results can be devastating when you choose Limited Tort and waive your right to sue for compensation for these lifelong after-effects.
Without compensation, you may never recover the money and bills you used for some situation of pain and suffering.
Limited Tort Exceptions
Limited tort generally limits your ability to sue for pain and suffering, but some exceptions can give you full tort rights. These are:
- Drunk or intoxicated driver. If a drunk or intoxicated driver or driver with DUI hits you, they give you a right to sue them, a right to full tort.
- The out-of-state vehicle. If an out-of-state car hits you in Pennsylvania, you’re allowed to sue the driver and recover damages like in full tort.
- Uninsured driver. If an uninsured driver hits you, you’re eligible to sue the driver for your pain and suffering under full tort.
- Commercial vehicle. If you’re hurt while driving a commercial car (rental car, taxi, bus, etc.), you automatically hold full tort rights even with a limited tort policy.
- Intentional collision. If the other driver hits you purposefully, intending to hurt you, you get an unlimited right to sue the driver and recover pain and suffering damages against them.
Limited Tort Vs. Full Tort: Is Limited Tort Right?
Whether full or limited tort, you retain the right to sue for “monetary or economic damages” (car damage, medical expenses, or lost earnings).
The difference between full tort and limited tort applies to “non-monetary damages,” otherwise known as pain and suffering.
Although limited tort coverage might be cheaper, it can result in restrictions to sue for non-monetary compensation, sometimes even severe injuries that you cannot prove.
It comes down to the risk you want to take compared to the upfront money you want to spend.
Verdict: Full tort is better and the right choice to make because it doesn’t limit your ability to sue for compensation.
When buying insurance, you need to understand whether your state is a tort state or a non-tort state — other names for tort and non-tort states and fault and no-fault states. If you’re in a tort state, you should ask your insurance agent the best option between full and limited tort. Limited tort limits your ability to sue for pain and suffering, but you’ll still get compensation for other monetary damages. Make the right choice.