New York uses a no-fault auto insurance system. For residents of New York, this can be a good thing, as insurers can more easily settle car accident claims when they do not need to determine fault.

However, a no-fault policy only shortens the time it takes to settle claims when they do not involve serious injuries. If a claim has certain exemptions that allow the injured party to supersede the no-fault system, the time to settle the claim could increase significantly.

Here are some facts you should know about the ways car accident claims are resolved in New York and how long the settlement process may take.

New York’s No-Fault System

In New York, after a car accident occurs, you can file a claim for injuries and property damage with your insurer, regardless of which party was at fault for the accident. In other words, every driver involved in a car accident in New York will work with their own insurer, and the issue of fault won’t generally impact anyone unless one of the parties involved in the accident suffers more than $50,000 in basic economic losses.

Basic economic losses include the medical expenses and lost earnings that result from the injuries suffered in a car accident. If your economic loss is less than $50,000, you will deal exclusively with your insurance company.

Expected Time Frames To Settle a No-Fault Claim

Settling a no-fault claim should be relatively straightforward in New York. The insurer does not need to determine fault, which should allow the insurer to settle or deny the claim quickly.

New York sets out an aggressive timeframe for insurers to settle claims:

  1. After you file a claim, the insurer will have 15 days to request additional information that it may need to be able to investigate the claim.
  2. After it receives your response with the additional information, the insurer will have 15 days to accept or deny the claim.

In an ideal situation, you would have a decision from the insurer about 30 days after the claim is filed. You would also have any insurance settlement check in hand about five days after the decision.

What if a Claim Is Denied or Requires Further Investigation?

New York provides a big loophole to insurers within its regulations. If the insurer needs additional time to investigate the claim, the company can send you a letter providing you with the reasons it needs additional time. This letter allows the insurer to extend its deadline by 90 days.

Some of the reasons an insurer can use to extend a deadline or deny the claim include a belief that:

  • The driver at the time of the accident was not included on your policy coverage
  • The vehicle involved was not listed on your policy
  • Your injuries were not caused by the car accident
  • Your medical treatment was not reasonably necessary for your injuries

If the insurer decides not to pay the claim or makes you wait while it investigates the claim, you may need to negotiate with the insurer to be able to receive payment. This negotiation could be difficult and time-consuming. If you receive a letter that denies your claim or extends the deadline for further investigation, there is no way to predict when your claim will be settled.

Hiring an injury lawyer can help to push your insurer to settle. A lawyer can provide the evidence needed to satisfy the insurance company’s concerns, end their investigation, or reverse their denial. Your lawyer could even threaten to take the insurer to arbitration or to court.

Exiting the No-Fault System

Suppose your insurer decides to pay your claim, but your no-fault benefits have been exhausted and you still have bills that are unpaid. Your insurer will not pay more than $50,000 in benefits under your auto insurance policy. But if your medical bills and lost wages exceed $50,000, you will need additional compensation.

Under New York law, you can exit the no-fault system and assert a claim against the at-fault driver if:

  1. Your economic loss is more than $50,000 or
  2. You suffer a “serious injury”

If either one of these parameters is true, you can file a claim against the liability policy of the at-fault driver. All New York drivers are required to carry liability insurance. This liability insurance covers damages that arise from bodily injuries in an accident caused by the policyholder.

Estimated Time Frames To Settle an At-Fault Claim

Insurers have the same deadlines to settle an at-fault claim as they would for a no-fault claim. Specifically, the insurer has 15 days after you file the claim to request additional information. After you provide the requested information, the insurer has 15 additional days to accept or deny the claim.

In this situation, an insurer must assess fault for the accident. An insurer could require additional time to investigate the claim. But assuming that the police reports and witness statements clearly show that their insured driver caused the accident, the insurer will need to make an offer of settlement before its time expires.

Litigating the Claim

If the insurer for the at-fault driver denies the claim or fails to make a fair settlement offer, you may need to file a lawsuit against the at-fault driver. The driver’s insurer will provide a legal defense for the driver and will be liable for any damages awarded up to the policy limits.

If you need to file a lawsuit, the time it will take to settle the case may vary widely. If the insurer believes its insured is liable, a settlement may come quickly. Insurance companies do not like to prolong a losing case. But even with contested cases, the case will likely settle eventually. Only about 3% of personal injury cases ever reach the courtroom.

No one can predict when a lawsuit may settle. Many cases are settled soon after a lawsuit is filed because insurers want to minimize their legal fees. Some lawsuits proceed through discovery until enough evidence develops to push toward a settlement. Some lawsuits even settle during trial, once the insurer sees how the jury is reacting to its defense.

Shortening the Time Frame To Reach Settlement

There are a few ways to shorten the time it takes settle a case, which include:

  • Fully documenting your claim so your insurer cannot create delays by asking for more information
  • Maintaining reasonable expectations for what you will receive through settlement
  • Hiring an injury lawyer to negotiate on your behalf and put pressure on the insurer to settle

Moving proactively to anticipate the insurer’s moves can help you stay ahead of them and resolve your claim quickly and fairly.