Tort insurance: what is full vs limited tort car insurance?

If you live in certain states like Kentucky, New Jersey or Pennsylvania, your agent may have given you the choice between full and limited tort on your car insurance policy. If you aren’t sure what a tort is in insurance, or what the difference is between full vs. limited tort, you’re not alone. Bankrate’s insurance editorial team is here to explain what tort means so that you can pick the coverage option that not only makes the most sense for your needs but also fits within your budget.

What is tort insurance?

Tort insurance allows auto insurance companies to recover damages from the party that caused an accident. Tort insurance isn’t a separate policy but is instead a coverage option, and it may or may not be available depending on the state you live in.

Most states require vehicle owners to have some form of car insurance. However, each state has its own limits and regulations. Some states are considered no-fault states. In no-fault states, each person’s personal injury protection, or PIP insurance, pays first for their own injuries and medical expenses, regardless of who is at fault.

In essence, tort states are the opposite of no-fault states. In tort states, drivers are held responsible for the damage and injuries that they cause to others. The majority of states in the U.S. follow tort insurance law, meaning the party that was responsible for the loss is financially responsible for the damages. There are exceptions, however. Although Kentucky, New Jersey and Pennsylvania are no-fault states, they do allow drivers to retain some ability to sue for compensation, meaning they follow both tort and no-fault laws.

Full tort vs. limited tort

Tort is nuanced. There are variations, known as full tort and limited tort, that affect your ability to sue for damages. The limited vs. full tort terminology is used primarily in the three no-fault states previously mentioned: Kentucky, New Jersey and Pennsylvania. In these states, you may have the option to retain your ability to sue another driver for medical expenses and pain and suffering, essentially opting out of your state’s no-fault laws.

In the table below, you’ll see how tort is defined and how choosing limited vs. full tort can affect your car insurance policy.

When learning about no-fault insurance and tort, it’s important to remember that these coverage options only apply to medical and medical-related expenses. At-fault drivers are always liable for the property that they damage, even in no-fault states. In these cases, the at-fault driver’s property damage liability coverage will help pay to repair your property (up to the limit of property damage coverage the at-fault driver carries).

Can I choose between full and limited tort?

You can choose between limited and full tort in three states: Kentucky, New Jersey and Pennsylvania. While the general idea behind limited tort is the same across these states, there are slight variations between them.

Kentucky tort

In Kentucky, limited tort is the default. Instead of suing the at-fault driver for medical expenses, lost wages or pain and suffering, you’ll rely on your PIP insurance for coverage. However, if your accident meets a certain threshold (listed below), you can still sue the other party for these expenses.

• Medical expenses that are greater than $1,000
• Broken bone(s)
• Permanent disfigurement
• Permanent injury
• Death

If you want to retain your ability to sue the at-fault driver regardless of the seriousness of your accident, you can sign the Kentucky No-Fault Rejection Form. If you choose this option, Kentucky law requires you to carry guest PIP coverage on your policy to cover passengers and pedestrians.

New Jersey tort

In New Jersey, limited tort is the default and is called the “limitation on lawsuit” option. However, if you’re the driver in a not-at-fault accident, you may still sue the at-fault driver for non-economic loss (pain and suffering) if the accident results in:

• Death
• Dismemberment
• Significant disfigurement or scarring
• Displaced fractures
• Loss of a fetus
• Permanent injury

New Jersey law states that to exercise your right to sue for pain and suffering in these instances, you must get a certification from a licensed physician within 60 days that proves you meet any of the criteria above.

Pennsylvania tort

In Pennsylvania, full tort insurance is the default. If you choose limited tort, you’ll have to sign and form and you’ll no longer have the ability to sue for non-monetary damages (such as pain and suffering) unless the at-fault driver:

• Was intoxicated
• Operating a vehicle that was registered in another state
• Caused an accident on purpose with the intent of hurting themselves or others
• Did not have insurance

It’s also worth noting that if you’re a passenger in a commercial vehicle (such as a taxi or bus), you will automatically have full tort rights and can sue for pain and suffering, regardless of the tort option on your policy.

What kind of tort should I have?

Although limited tort might be ideal for some, it may not be the right choice for all. If you’re having a hard time choosing between full tort vs. limited tort insurance, the following considerations may help you decide:

• Budget: If you’re on a strict budget, then limited tort might be what you’re looking for. Generally, limited tort is less expensive than full tort.
• The number of drivers in your household: Typically, choosing limited tort doesn’t just limit your own ability to sue for pain and suffering in a not-at-fault accident. It may also limit the ability of all the drivers included on your policy to do so. Discuss your options with your additional drivers — as well as your insurance agent — to understand the implications that come with choosing limited tort.
• Source of income: If you are the primary breadwinner in your home and think that you might face financial hardship if you’re unable to sue for lost wages or pain and suffering after a not-at-fault accident, the additional premium that comes with full tort could be worth it.

Remember, the best insurance policy isn’t always the one that’s the cheapest. If you’re still not sure whether limited or full tort is the right choice, you might find it helpful to discuss your options with a licensed agent.

Tort insurance vs no-fault insurance

States fall into two main categories when it comes to car insurance: at-fault/tort states or no-fault states. The majority of the states in the country apply at-fault principles when it comes to car accidents. If you are at fault, you are expected to pay for the damages, often through a car insurance policy. Only a dozen states follow no-fault laws, which means each driver pays for their own injuries and medical expenses after an accident.

No-fault insurance

A common misconception in no-fault states is that each driver pays for all their damages — including injuries, vehicle damage and a rental car — after a loss, regardless of fault. This is not true. No-fault insurance means that each driver uses their own PIP to pay for their injuries after an accident. In some no-fault states, you may have the option to retain your right to sue for your injuries by choosing full or limited tort.

Tort insurance

Tort states expect at-fault drivers to pay for the damages they cause. In tort states, you will not have the option to purchase full or limited tort. These options allow you to retain your right to sue an at-fault driver, but in tort states, you never lose that right. If a driver causes injuries and damages, you always have the right to sue for compensation.

Frequently asked questions

• • What is a tort in insurance?

    Tort, in an insurance capacity, means that the at-fault party can be held responsible for the damages or injuries they caused. If the driver or their insurance company does not pay you for the damages, tort permits you to sue.

  • Is full coverage the same as full tort insurance?

    Full coverage is not the same as full tort insurance. Full coverage is a combination of liability coverage (which pays for damages to third parties) and collision and comprehensive coverage (which add financial protection for damage to your vehicle). Full tort insurance is a form of coverage that allows you to sue the other party for medical and medical-related damages. Full tort car insurance is not available in all states. However full coverage can be purchased regardless of the state you live in.

  • Does tort insurance pay for pain and suffering?

    If you live in a state where you can choose between full and limited tort, choosing full tort insurance allows you to sue for pain and suffering. If you elect to purchase limited tort insurance, you may save on the cost of car insurance, but you also waive your right to sue for pain and suffering.

  • Is full tort more expensive than limited tort?

    When comparing the cost of full tort vs. limited tort insurance, full tort insurance is typically more expensive than limited tort coverage. Full tort insurance allows you to sue the at-fault party for additional expenses, such as those resulting from pain and suffering. Because of this broader ability to sue, the coverage is generally more expensive.