Full Tort vs. Limited Tort: Should You Limit Your Right to Sue?

A full tort system places no restrictions on a driver’s right to sue the liable driver in a car accident, while limited tort systems permit only drivers with costly or severe injuries, such as death or dismemberment, to sue. Limited tort systems are available only in the 12 states — the remaining 38 states use the full tort system. Drivers in limited tort states can choose between a full tort or limited tort system.

We’ll explain how each system works and the pros and cons of each.

On This Page

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  What Is a Tort?

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  What Is Limited Tort Coverage?

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  What Is Full Tort Coverage?

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  Which States Use Tort vs. No-Fault Systems?

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  How Much Does Limited Tort vs. Full Tort Cost?

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  FAQs

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  Methodology

What Is a Tort?

In the context of auto insurance, a tort refers to a driver’s ability to sue another driver for losses and pain and suffering after a car accident. There are two types of torts: full and limited. Full tort insurance places no restrictions on an individual’s ability to sue another driver after an accident, but these restrictions apply with limited tort insurance.

Full Tort vs. Limited Tort

Below we highlight key differences in the right to sue, insurance claims process and cost between states with limited tort and full tort systems.

What Is Limited Tort Coverage?

Limited tort coverage refers to restrictions on a person’s right to sue the at-fault driver for damages as well as pain and suffering that resulted from a car accident. Also called tort thresholds, these restrictions require individuals to meet a minimum level of medical or financial burden. Two types of tort thresholds exist: monetary and verbal.

• Monetary: The injured party’s financial burden (e.g., medical bills) must reach a minimum dollar amount.
• Verbal: The injured party’s injuries must reach a certain level of severity (e.g., death, dismemberment).

Tort thresholds will vary by state. For example, the monetary tort threshold is $5,000 in Hawaii and $2,000 in Kansas. A Kansas driver cannot sue a driver if their medical bills total $700 but can sue if the bill totals $2,500. Tort thresholds help clear courts of minor injury claims, freeing the judge’s resources to handle claims involving severe injuries.

States with limited tort coverage require no-fault insurance, also called personal injury protection (PIP). Although limited tort insurance restricts your right to sue, no-fault insurance will pay for your medical expenses, lost wages and funeral fees. With no need to determine fault and file a claim with the liable driver’s insurer, claim payouts tend to happen more quickly with no-fault insurance.

Limited tort states restrict a person’s right to sue the at-fault driver for damages as well as pain and suffering that resulted from a car accident.

Purchasing limited tort insurance is generally cheaper than full tort coverage. However, the lower costs mean sacrificing your right to sue for pain and suffering. No-fault insurance will reimburse you for your medical expenses but not for pain and suffering.

What Is Full Tort Coverage?

Drivers with full tort coverage have an unrestricted right to sue the negligent driver in a car accident for losses plus pain and suffering. With no thresholds in place, drivers can sue the liable driver for $100,000 or $10,000 in losses or as little as $500.

Full tort insurance places no restrictions on an individual’s ability to sue another driver after an accident.

Full tort coverage is the only option available in 38 states. Insurers in the remaining 12 states may allow their customers to choose between full tort or limited tort insurance.

Full tort coverage costs more, but you have an unrestricted right to sue for pain and suffering. No-fault insurance in limited tort systems will reimburse you for your medical costs, but not pain and suffering.

Example: After a car accident, you are recovering for several months. You can’t go to work, see your friends or attend events.  In a limited tort system, you can only sue for the loss of quality in your life — your pain and suffering — unless you meet the tort threshold. In a full tort system without thresholds, you can.

Although full tort coverage generally costs more, you always have the right to sue for pain and suffering (on top of your property damages and medical bills).

Which States Use Tort vs. No-Fault Systems?

Thirty-eight states use the full tort system. The remaining 12 states offer no-fault insurance and drivers may choose between full tort or limited tort insurance. No-fault insurance is available in these 12 states:

• Florida
• Hawaii
• Kansas
• Massachusetts
• Michigan
• Minnesota
• New York
• North Dakota
• Utah
• Kentucky
• New Jersey
• Pennsylvania

Keep in mind that no-fault insurance is not available in the 38 full tort states. Drivers will need medical payments coverage or to file a claim against the other driver for medical expense reimbursement.

States with limited tort coverage require no-fault insurance, also called personal injury protection (PIP).

Below, we’ve summarized the tort thresholds in the 12 states with limited tort systems. Recall that monetary thresholds measure the financial cost of a driver’s losses and verbal thresholds measure the severity of an injury (e.g., death, dismemberment, permanent disfigurement).

How Much Does Limited Tort vs. Full Tort Cost?

Limited tort coverage can cost 40% less than full tort coverage according to Unruh Insurance Agency Inc. Keep in mind that limited tort policies may enjoy cheaper premiums but drivers must meet tort thresholds if they intend to sue another party after an auto accident.

Drivers in full tort states will need medical payments coverage or to file a claim against the other driver for medical expense reimbursement.

Below, we’ve shared average annual rates in the 12 states that offer limited tort coverage and what 40% savings can look like.

Note: The average annual rates above do not account for differences in tort laws. The 40% savings figures are used for illustration purposes only and actual rates can vary.

Find the cheapest auto insurance in your state. SmartFinancial’s FREE online tool analyzes car insurance companies in your area to bring you the best policy based on your answers to a few questions about your insurance coverage needs and budget. Just enter your zip code below or call 855.214.2291 to receive your free car insurance quotes.

Methodology

SmartFinancial obtained average premium rates for collision coverage by state and nationwide from a 2022 report by the National Association of Insurance Commissioners (NAIC): 2018/2019 Auto Insurance Database Report. NAIC calculated premiums using policies underwritten in 2019. Average annual rates did not account for differences in state auto and tort laws. Actual rates can vary and consumers should use these figures only for comparative purposes.