Should the "No-Fault" Concept Be Applied to Automobile Property Damage?

Abstract

In this study the automobile bodily injury liability insurance claims settlement process is compared to that of the property damage liability insurance system. The objective is to determine if similar problems exist in both settlement processes such that legislative modifications of both systems are warranted. In addition, the claims settlement process under automobile medical payments insurance and collision insurance are compared to their corresponding liability insurance coverages to provide an improved perspective of the claims settlement process. These analyses do not suggest either that modification or abandonment of negligence law in its application to property damage claims is warranted. Summary conclusions are that substantial differences exist between the settlement of property damage liability insurance claims and bodily injury liability insurance claims. Only minor differences were found in the settlement of first party collision insurance claims and property damage liability insurance claims. Indications are that the benefits to be derived from the preservation of the property damage tort liability insurance system outweigh any potential benefits to be gained by its elimination.