No-Fault Insurance

Minnesota's auto insurance system where your own insurance company pays for your medical bills and lost wages after a car accident, regardless of who caused the crash.

Minnesota is a “no-fault” auto insurance state. This means that after a car accident, your own insurance company pays for your medical expenses and a portion of your lost wages, no matter who caused the accident. These benefits are called Personal Injury Protection (PIP) or “basic economic loss benefits.”

Under Minn. Stat. chapter 65B, every auto insurance policy in Minnesota must include at least $40,000 in no-fault benefits. This covers medical expenses, wage loss (up to $500 per week), replacement services (up to $200 per week for hiring help with household tasks), and funeral expenses.

The no-fault system does not prevent you from suing the other driver. However, to bring a lawsuit for pain and suffering, you must meet a “threshold” – your medical bills must exceed $4,000, or you must have suffered a permanent injury, disfigurement, or disability lasting at least 60 days.

Why it matters: If you are in a car accident in Minnesota, you should file a claim with your own insurance company for PIP benefits right away, even if the other driver was at fault. These benefits are available quickly and do not require proving who caused the accident.

Example: Two cars collide at an intersection. Both drivers file PIP claims with their own insurance companies. Driver A’s insurance pays for Driver A’s $8,000 in medical bills and lost wages, while Driver B’s insurance does the same for Driver B, regardless of who caused the accident.