Is Texas a No-Fault State for Auto Insurance?
Texas isn’t a no-fault state — it’s an at-fault state. That means the at-fault driver’s insurance pays for the other party’s damages.
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Carley ClarkInsurance Writer
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Edited byKatie Powers
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Katie PowersLicensed P&C Agent, Senior Insurance Editor
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Texas is an ‘at-fault’ car insurance state
Texas car insurance follows an at-fault system, meaning the driver responsible for the crash must pay the resulting costs. Under Texas law, every driver must carry liability insurance to cover injuries and property damage they cause in an accident.
The injured party also has the right to sue the at-fault driver directly, with no lawsuit restrictions.
Every auto policy in Texas automatically includes personal injury protection (PIP), which covers medical expenses and lost wages for you and your passengers, even if you’re at fault. PIP isn’t mandatory, but you must provide written notice to your insurer to opt out.[1]
At-fault vs. no-fault car insurance
In an at-fault state like Texas, whoever causes an auto accident is financially responsible for the damages. The at-fault driver’s liability insurance covers the other driver’s injuries and vehicle repairs.
With a no-fault system, drivers must file car accident claims with their own insurance company first, regardless of who was at fault. No-fault systems aim to lower the average cost of car insurance by keeping small claims out of the courts, but no-fault states typically require PIP coverage.[2]
Twelve states and Puerto Rico use no-fault systems, including Florida, Michigan, and New York. Below is a brief overview of the differences between at-fault and no-fault insurance systems.
Question  | Texas: At-Fault State | No-Fault State |
|---|---|---|
| Who pays first for injuries? | The at-fault driver’s insurer | Your own insurer |
| Is PIP required? | Included by default; opt out in writing | Yes |
| Can you sue the other driver? | Yes | Only for severe injuries meeting a threshold |
| What coverage is required? | Liability insurance | Liability insurance plus PIP |
How do accident claims work in Texas?
Texas car accident laws require the injured party to file their claim with the at-fault driver’s liability insurance. This coverage handles both property damage, including vehicle repairs, and bodily injury claims, such as medical bills and pain and suffering.
Say a driver rear-ends you on Interstate 35 in Austin. You would file a claim with the at-fault driver’s insurance company for vehicle damage and medical expenses.
If their insurance doesn’t cover all the damages, your collision coverage, PIP, or uninsured/underinsured motorist (UM/UIM) coverage will help with the remaining costs.
If another driver injures you in an accident, their insurer will offer a settlement for your medical bills and ask you to sign a release stating you won’t seek more compensation later. The Texas Department of Insurance recommends that you speak with your doctor about future medical treatment before signing the release.
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What are shared fault rules in Texas?
Texas proportionate responsibility insurance laws affect how much you can recover if you’re in a crash that was partially your fault. Your percentage of fault reduces your payout proportionately.
For example, two drivers collide in Dallas. One ran a stop sign, but the other was speeding, so the court assigns 70% fault to the first driver and 30% to the second. If the second driver’s total damages are $10,000, they can recover $7,000 after the 30% reduction.
If the accident was 51% or more your fault, you can’t recover anything. A higher fault percentage also means greater liability exposure — and potentially out-of-pocket expenses if damages exceed your policy limits.
Minimum car insurance requirements in Texas
All Texas drivers must carry 30/60/25 coverage to meet minimum car insurance requirements. Liability insurance covers another party’s injuries and damages you cause in an accident, but not your own.
Texas auto insurance policies automatically include PIP, and insurers must offer UM coverage, but you can opt out of either or both in writing.
Coverage Type | Texas Minimum Requirement | What It Covers |
|---|---|---|
| Bodily injury liability per person | $30,000 | Pays for injuries you cause to one person in a single accident |
| Bodily injury liability per accident | $60,000 | Pays for injuries you cause to more than one person in a single accident |
| Property damage liability | $25,000 | Pays to replace or repair property you damage in an accident |
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What to do after a car accident in Texas
Taking the right steps after an accident can help the claims process go more smoothly:
Move to safety. Get your car out of the road if it’s drivable and no one’s injured.
Call the police. A police report can help prove who was at fault. Request a copy to submit to the insurance company.
Document the accident scene. Take photos of the vehicles involved, the damage, and the license plates. Also, take pictures of the accident scene, as well as street signs and the surrounding area. Note the location, time, weather conditions, and any relevant details.
Exchange information. Get a photo of the other driver’s insurance card and license. Collect witness statements and request contact information from anyone who saw the crash.
Notify your insurer and file the claim. Call your insurer to report the accident, even if you weren’t at fault. If the other driver caused the crash, you’ll file the claim with their insurance company.
Keep records. Save all medical bills and repair estimates for the claim investigation. Texas law requires insurers to accept or deny claims within 15 business days (or 45 days if additional time is needed) and to send payment within five business days of approval.
Repair your vehicle. You can choose any body shop you want. Your insurer will provide an estimate, but the shop can submit a revised one if costs run higher.
Use your own insurance coverage if needed. If the at-fault driver is uninsured or it’s a hit-and-run, your collision coverage or UM coverage can help cover damages. PIP can help with medical bills.
Texas car insurance FAQs
Texas is an at-fault state, which determines who pays for damages after an accident. Answers to the following frequently asked questions can provide more information.
How does being an at-fault state affect car insurance claims in Texas?
Texas’s at-fault system means the driver responsible for the crash is also responsible for the costs. Accident victims file claims with the at-fault driver’s liability insurance, not their own.
Does your car insurance go up if you have an accident in Texas that’s not your fault?
While Texas law prevents insurers from nonrenewing your policy due to a single not-at-fault accident, it doesn’t prohibit rate increases. Comparing car insurance quotes may help keep your premiums low after an accident.
What happens if the other person doesn’t have insurance?
If the other driver doesn’t have insurance, your own coverage can step in. UM coverage can pay for car repairs, medical bills, a rental car, and pain and suffering. Also, UM coverage may have a lower deductible than collision coverage.
Whose insurance pays for medical bills after a car accident in Texas?
In Texas, the at-fault party’s liability coverage pays for your medical bills after an accident. If the damages exceed their policy limits, your PIP or UM/UIM coverage can help cover the remaining costs.
Sources
- Texas Department of Insurance. "Auto insurance guide."
- Insurance Information Institute. "Background on: No-fault auto insurance."
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Carley ClarkInsurance Writer
5+ years experience in personal finance writing
Personal finance blogger
Katie PowersLicensed P&C Agent, Senior Insurance Editor
Licensed auto and home insurance agent
4+ years experience in insurance and personal finance editing
NPN: 20564519
Featured in
David MarlettAdvisor