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John Bruscato Oct. 21, 2020

Just because you've been in a car accident doesn't mean you are automatically eligible for financial compensation. In fact, in some states, if you don't have adequate insurance coverage, you may be on the hook to cover the other driver's damages out-of-pocket.

An auto accident victim's right to compensation will typically depend on three main factors: 

  • The extent of the damages and injuries incurred

  • The nature of the car crash

  • The details of the driver's liability insurance coverage

The fact is, adhering to the right insurance requirements (if only the bare minimum) for the state you live in may be the most important way to protect yourself in the event you're a victim in an automobile accident — especially if you're a resident in a No Pay, No Play state.

If you're an uninsured driver living in a No Pay, No Play state, then you may not be eligible to file a claim and receive financial compensation for your damages and losses — even if you've suffered a severe injury.

What is a 'No Pay, No Play' Law?

In the context of car insurance laws, No Pay, No Play statutes are state-specific regulations that limit a driver's eligibility for financial compensation after a car accident, regardless of fault. 

People tend to have mixed feelings about this law.

Proponents believe it is a useful way to encourage drivers to be safer on the road by sticking with the appropriate insurance premiums. Proponents also contend that uninsured drivers should not be able to benefit from law-abiding driver's insurance, while simultaneously being eligible to the same priileges if they do happen to get in an accident. 

Conversely, opponents of the law take issue because uninsured drivers may lack insurance because they can't afford it in the first place, and are then puished for their lack of coverage.

Uninsured motorists account for approximately 14% of all drivers on American roads (or 1 in 7 drivers). Insurance costs tend to be higher in states with more uninsured drivers because they cause insurers to lose more money on costly accident damages.

What is Louisiana's No Pay, No Play Statute?

In Louisiana, according to Revised Statute § 32:866  on the No Pay, No Play law:

"[t]here shall be no recovery for the first fifteen thousand dollars of bodily injury and no recovery for the first twenty-five thousand dollars of property damage based on any cause or right of action arising out of a motor vehicle accident, for such injury or damages occasioned by an owner or operator of a motor vehicle involved in such accident who fails to own or maintain compulsory motor vehicle liability security."

In other words, if you are involved in a crash and do not have liability coverage at the time of the accident, you forfeit your right to sue.

An uninsured (and under-insured) driver will be held responsible for:

  • The first $15,000 in bodily injury liability 

  • The first $25,000 in property damage liability

The significance here is that even if the other driver was at-fault, you may still be barred from filing a claim for your motor vehicle accident if you don't have adequate insurance coverage. 

A few caveats to this: if the at-fault driver was convicted of driving under the influence, acting intentionally, fleeing the scene of the accident, or in the commission of a felony at the time of the accident, the No Pay, No Play law would be negated. 

The Louisiana Fault System of Insurance

Before I explain car insurance requirements in Louisiana, you should know that each state will have one of two types of insurance requirements.

No-Fault States

If you live in a no-fault state, you must contact your own insurance company after an accident, no matter who caused the crash.

If you were the at-fault driver, the victim would go through their auto insurance policy to begin the claims process and seek compensation for their injury or property damage.

Fault States

On the other hand, in fault states (or tort states) like Louisiana, the person who caused the car accident is responsible for damages.

This is where the No Pay, No Play law really comes into effect; If you are uninsured or lack comprehensive coverage, then you might be responsible for covering any damages out of pocket. 

Insured drivers in Louisiana must meet the following liability coverage levels:

  • Bodily injury: $15,000 per person

  • Bodily injury: $30,000 per accident

  • Property damage: $25,000 per accident

Unlike every other No Pay, No Play state in the country, Louisiana doesn't pose limitations on the types of damages that can be recovered through insurance claims. 

Many states limit car insurance claims for non-economic losses or damages. This category of damages would include things that you couldn't easily attach a dollar value to. 

Non-economic damages may include:

  • Pain and suffering

  • Emotional distress

  • Mental anguish

  • Loss of companionship

Economic damages may include:

  • Medical bills

  • Vehicle repair costs

  • Lost wages

  • Anything that can be quantified and have a set value

Which States Have No Pay, No Play Laws?

There are 11 states in all that have No Pay, No Play laws: Alaska, California, Indiana, Iowa, Kansas, Louisiana, Michigan, Missouri, New Jersey, North Dakota, and Oregon. 

Car insurance is required in every state in America (save for New Hampshire). And to own and operate a vehicle, you need to pay for a liability insurance policy, which will be determined by the local laws of the state you live in. 

If you live in one of the 11 states mentioned above and don't have adequate auto insurance, it may be your personal financial responsibility to pay for any resulting damages out of pocket.

If you or someone you know has questions or issues with the No Pay, No Play law, contact the office of John Bruscato today for a free consultation for any legal advice you need.

No Pay, No Play in Louisiana

As a car accident lawyer, my best advice to you is to get adequate driver's insurance! If you are uninsured and the at-fault driver in a crash, you may be in for some difficult times. Maintaining the minimum coverage in your state doesn't just protect you and your liability, but those around you as well.

John Bruscato is an experienced Louisiana personal injury lawyer in Monroe with nearly a decade of experience working with car accident victims to fight for the compensation they deserve.

If you have been in a car accident and are unsure of the right course of action for your situation, contact Bruscato today to schedule a free case evaluation.