Legal Trends
New York's Crash Payout Cap Hasn't Moved Since 1973.
A single MRI runs up to $3,000 and spine surgery can top $100,000. No-fault still stops at the same $50,000 it paid five decades ago.
In this report
Key Finding
New York's no-fault system covers up to $50,000 in medical bills and lost wages regardless of fault. But to sue for pain and suffering, your injuries must meet one of eight specific categories under Insurance Law 5102(d). Understanding this threshold is critical to every car accident case in New York.
Every car accident in New York starts with the same question: can you sue?
The answer depends on a single statute. Insurance Law § 5102(d) defines “serious injury.” That definition controls whether you can recover anything beyond your basic no-fault benefits. If your injuries meet the threshold, you can pursue a full lawsuit for pain and suffering, lost wages beyond the PIP cap, and other non-economic damages. If they don’t, your recovery maxes out at what no-fault pays: $50,000.
$50,000
maximum no-fault (PIP) benefit per person. Medical costs and lost wages above this cap require a lawsuit, which requires meeting the serious injury threshold under Insurance Law § 5102(d).
This is the gatekeeping mechanism of New York personal injury law. It applies to every motor vehicle accident in the state. It’s the single most litigated issue in car accident cases.
How No-Fault Works
New York adopted its no-fault insurance system in 1973. The basic premise: after a car accident, your own insurance company pays your medical bills and a portion of your lost wages, regardless of who caused the crash. In exchange, you give up the right to sue for minor injuries.
What No-Fault Covers
Under the Personal Injury Protection(PIP) portion of your policy, no-fault pays up to $50,000 in “basic economic loss”:
- Medical expenses. All necessary medical treatment related to the accident, including hospital stays, surgery, physical therapy, diagnostic imaging, and prescriptions
- Lost earnings. 80% of your lost income, capped at $2,000 per month
- Other expenses. Up to $25 per day for reasonable costs like transportation to medical appointments, household help, and childcare necessitated by your injuries
No-fault policies also carry a separate $2,000 death benefit. It sits outside the $50,000 basic economic loss limit as a distinct mandatory PIP benefit.
Note
You must file your no-fault application (form NF-2) with your insurance company within 30 days of the accident under Insurance Law § 5106. Miss this deadline and you can lose all no-fault benefits.
Filing for treatment
Medical providers must submit bills to the no-fault insurer within 45 days of treatment. Denied claims get challenged through arbitration, not court.
What No-Fault Doesn’t Cover
No-fault is strictly economic. It doesn’t compensate:
- Pain and suffering
- Emotional distress
- Loss of enjoyment of life
- Loss of consortium
- Full lost wages above the $2,000/month cap
- Future medical expenses beyond the $50,000 limit
For these damages, you need a lawsuit. And for that lawsuit, you need a serious injury.
The Serious Injury Threshold: Insurance Law 5102(d)
This is the statute that controls access to the courts for every injured person in a New York car accident. The full definition is at NY Senate Insurance Law § 5102:
A “serious injury” means a personal injury which results in:
- Death
- Dismemberment
- Significant disfigurement
- A fracture
- Loss of a fetus
- Permanent loss of use of a body organ, member, function, or system
- Permanent consequential limitation of use of a body organ or member
- Significant limitation of use of a body function or system
Note
New York repealed a ninth category, the 90/180-day rule, through Bill A10008, Chapter 58 of 2026, signed May 26, 2026. The repeal applies to lawsuits filed on or after that date. Lawsuits filed before May 26, 2026 proceed under the old nine-category definition.
Categories 1 through 5 are relatively straightforward. If you broke a bone, you have a serious injury. Lost a limb? Serious injury. These are “per se” categories where the injury itself satisfies the threshold.
Categories 6 through 8 are where most of the litigation happens.
The Contested Categories
Permanent Consequential Limitation (Category 7)
This requires proof of a permanent limitation of use of a body organ or member that’s “consequential,” meaning medically significant. The Court of Appeals established the standard in Dufel v. Green, 84 N.Y.2d 795 (1995). The limitation must rest on objective medical evidence. It must involve a comparative determination of the degree or qualitative nature of the injury based on the normal function of the body part.
In practice, that means your doctor must quantify the limitation. A statement like “the patient has reduced range of motion in the cervical spine” isn’t enough. The doctor must compare your current function to normal function using objective measurements. Example: “Cervical flexion is 30 degrees, compared to a normal range of 50 degrees. A 40% deficit.”
Significant Limitation of Use (Category 8)
Similar to Category 7 but doesn’t require permanence. The limitation must be “significant,” meaning more than minor or mild. Courts look for:
- Objective test results (MRI findings, range-of-motion measurements, nerve conduction studies)
- Duration of treatment
- Whether the limitation affects the person’s ability to perform daily activities
- Whether the medical evidence is consistent over time
The Court of Appeals in Toure v. Avis Rent A Car Systems, 98 N.Y.2d 345 (2002) held that an expert must designate, by percentage or otherwise, the plaintiff’s loss of range of motion to establish a “significant limitation.”
The 90/180-Day Rule (Repealed May 26, 2026)
Until May 26, 2026, a ninth category served as the catch-all for injuries that weren’t permanent but were genuinely disabling in the short term. Bill A10008 repealed it, effective for lawsuits filed on or after May 26, 2026. Lawsuits filed before that date still proceed under it. Those cases must show:
- A medically determined injury (not just self-reported symptoms)
- That prevented the injured person from performing “substantially all” of their usual daily activities
- For at least 90 of the 180 days following the accident
“Substantially all” is a high bar. Courts have held that a person who returned to work or performed modified duties may not qualify under this category, even if they were in significant pain. The 90 days don’t need to be consecutive. But they must fall within the first 180 days after the crash.
How Defense Lawyers Attack the Threshold
In nearly every car accident case in New York, the defense files a motion for summary judgment arguing that the plaintiff didn’t sustain a serious injury. It’s the most common dispositive motion in New York personal injury litigation.
The defense strategy typically follows this pattern:
Step 1: Independent medical examination (IME)
The insurance company sends you to their chosen doctor. That doctor examines you and frequently concludes you have full range of motion, no objective deficits, and a “resolved” condition.
Step 2: Motion for summary judgment
Using the IME report, the defense argues your injury doesn’t meet any category of 5102(d). If the court agrees, your case is dismissed before trial.
Step 3: Challenge gaps in treatment
If you stopped physical therapy for several months or had a gap between the accident and your first medical visit, the defense will argue the gap proves your injuries weren’t serious.
To survive this motion, you need:
- Contemporaneous medical records documenting objective findings (MRI abnormalities, positive clinical tests, quantified range-of-motion deficits)
- Consistent treatment without unexplained gaps
- Medical expert opinions that specifically address the statutory categories and provide objective measurements
- Proof that pre-existing conditions were aggravated (if applicable), with a causal link to the accident
The Court of Appeals made clear in Scheer v. Koubek (70 N.Y.2d 678, 1987) that subjective complaints of pain, standing alone, don’t satisfy the serious injury threshold. Objective proof is required.
Where the $50,000 Runs Out
The $50,000 PIP limit has stayed flat since the 1970s. Medical costs have risen dramatically since then. A single MRI in New York City can cost $1,000 to $3,000. Cervical spine surgery can exceed $100,000. A multi-day hospital stay after a serious crash can exhaust the entire $50,000 before discharge.
When PIP runs out, the injured person faces a gap. They still need medical treatment, but no-fault won’t pay for it. Health insurance may pick up some costs. Co-pays, deductibles, and out-of-network restrictions add more financial pressure.
That’s one reason the serious injury threshold matters so much. If your injuries qualify, you can pursue a lawsuit that recovers full medical expenses, complete lost wages, and compensation for pain and suffering. If they don’t, you’re limited to a benefit that was set decades ago and hasn’t kept pace with medical inflation.
Optional Additional Coverage
New York offers two additional no-fault coverage options beyond basic PIP:
Additional PIP (APIP)
Extends first-party coverage above the $50,000 basic PIP limit. Carriers commonly sell it in $50,000 increments, often up to a total of $100,000 or more. It’s optional coverage that must be purchased.
Optional Basic Economic Loss (OBEL)
Provides an additional $25,000 for basic economic loss. Unlike APIP, OBEL coverage can be directed to any category of economic loss: medical expenses, lost wages, or other reasonable expenses.
Many New Yorkers carry only the basic $50,000 PIP. They discover the gap only after a serious accident.
How New York Compares to Other No-Fault States
New York is one of 12 states operating under a no-fault auto insurance system. Each state sets its own threshold for when an injured person can step outside no-fault and file a lawsuit.
| State | PIP Minimum | Lawsuit Threshold |
|---|---|---|
| New York | $50,000 | Verbal: must meet “serious injury” definition |
| Michigan | Unlimited (pre-2020) | Verbal: “serious impairment of body function” |
| New Jersey | $15,000 | Verbal: limitation-on-lawsuit vs. no-limitation option |
| Florida | $10,000 | Verbal: “permanent injury” |
| Pennsylvania | $5,000 | Verbal (limited tort) or full tort option |
New York’s threshold is among the most restrictive. The eight-category verbal threshold means every case turns on medical evidence and statutory interpretation, not a simple dollar amount.
The Motorcycle and Pedestrian Exception
Motorcycles aren’t covered by no-fault in New York. If you’re injured while riding a motorcycle, you can sue immediately without meeting the serious injury threshold. No-fault applies only to “covered persons” involved in accidents with “motor vehicles.” Motorcycles are excluded from the definition.
Pedestrians and cyclists injured by motor vehicles are covered by no-fault. They can claim PIP benefits through the at-fault vehicle’s policy or their own household auto policy. But to sue for pain and suffering, they still must meet the serious injury threshold.
What This Means for Your Case
If you were in a car accident in New York, no-fault provides immediate benefits for medical treatment and partial lost wages. Those benefits are available regardless of who caused the crash. File for them within 30 days.
The harder question is whether your injuries qualify for a full lawsuit. Fractures, surgical injuries, and permanent limitations typically clear the threshold. Soft tissue injuries, herniated discs, and other conditions that require MRI documentation and objective range-of-motion testing face more scrutiny.
What matters most: getting medical treatment promptly and continuously, and documenting your injuries with objective evidence from the start. Gaps in treatment and lack of objective findings are the two most common reasons courts dismiss cases at the threshold stage.
The statute was designed to filter out minor claims. It wasn’t designed to prevent genuinely injured people from recovering fair compensation. But navigating it requires understanding exactly what the law demands.
Frequently Asked Questions
What does New York no-fault insurance cover?
New York no-fault (PIP) insurance covers up to $50,000 in basic economic loss regardless of who caused the accident. This includes all necessary medical expenses, 80% of lost earnings up to $2,000 per month, and up to $25 per day for other reasonable expenses like transportation to medical appointments. A separate $2,000 death benefit sits outside that $50,000 limit. These benefits are paid by your own insurance company, not the at-fault driver’s insurer. You must file your no-fault application within 30 days of the accident.
What is the serious injury threshold in New York?
Under Insurance Law Section 5102(d), a serious injury is one that results in: death, dismemberment, significant disfigurement, a fracture, loss of a fetus, permanent loss of use of a body organ or member or function or system, permanent consequential limitation of use of a body organ or member, or significant limitation of use of a body function or system. If your injuries do not fit one of these eight categories, you cannot sue for pain and suffering. A ninth category, the 90/180-day rule, existed until Bill A10008 (Chapter 58 of 2026) repealed it effective May 26, 2026. Lawsuits filed before that date still proceed under the old nine-category definition.
Can I sue for pain and suffering after a car accident in New York?
Only if your injuries meet the serious injury threshold under Insurance Law 5102(d). New York’s no-fault system bars lawsuits for non-economic damages (pain and suffering, emotional distress, loss of enjoyment of life) unless the injured person has a qualifying serious injury. Fractures, surgical injuries, and permanent limitations typically qualify. Soft tissue injuries like sprains and strains face closer scrutiny from courts and often require objective medical evidence such as MRI findings and quantified range-of-motion deficits to survive a defense motion for summary judgment.
Sources
- NY Senate. Insurance Law § 5102(d): Definition of Serious Injury. https://www.nysenate.gov/legislation/laws/ISC/5102
- NY Senate. (2026). Bill A10008C (Chapter 58 of 2026), Part EE: Repeal of the 90/180-Day Category. https://www.nysenate.gov/legislation/bills/2025/A10008
- NY Senate. Insurance Law § 5104: Causes of Action for Personal Injury. https://law.onecle.com/new-york/insurance/ISC05104_5104.html
- NY Department of Financial Services. FAQ: Consumer Questions About No-Fault Insurance. https://www.dfs.ny.gov/consumers/auto_insurance/nofault_faqs
- Justia. Dufel v. Green, 84 N.Y.2d 795 (1995). https://law.justia.com/cases/new-york/court-of-appeals/1995/84-n-y-2d-795-0.html
- Justia. Toure v. Avis Rent A Car Systems, 98 N.Y.2d 345 (2002). https://law.justia.com/cases/new-york/court-of-appeals/2002/98-n-y-2d-345-1.html
- NY State Comptroller. (2024). Traffic Fatalities Are Growing in New York State. https://www.osc.ny.gov/files/reports/pdf/traffic-fatalities-are-growing-in-new-york-state.pdf
Updated July 12, 2026
Frequently asked questions
- What does New York no-fault insurance cover?
New York no-fault (PIP) insurance covers up to $50,000 in basic economic loss regardless of who caused the accident. This includes all necessary medical expenses, 80% of lost earnings up to $2,000 per month, up to $25 per day for other reasonable expenses like transportation to medical appointments, and a $2,000 death benefit. These benefits are paid by your own insurance company, not the at-fault driver's insurer. You must file your no-fault application within 30 days of the accident.
- What is the serious injury threshold in New York?
Under Insurance Law Section 5102(d), a serious injury is one that results in: death, dismemberment, significant disfigurement, a fracture, loss of a fetus, permanent loss of use of a body organ or member or function or system, permanent consequential limitation of use of a body organ or member, or significant limitation of use of a body function or system. If your injuries do not fit one of these eight categories, you cannot sue for pain and suffering. A ninth category, the 90/180-day rule, existed until Bill A10008 (Chapter 58 of 2026) repealed it effective May 26, 2026. Lawsuits filed before that date still proceed under the old nine-category definition.
- Can I sue for pain and suffering after a car accident in New York?
Only if your injuries meet the serious injury threshold under Insurance Law 5102(d). New York's no-fault system bars lawsuits for non-economic damages (pain and suffering, emotional distress, loss of enjoyment of life) unless the injured person has a qualifying serious injury. Fractures, surgical injuries, and permanent limitations typically qualify. Soft tissue injuries like sprains and strains face closer scrutiny from courts and often require objective medical evidence such as MRI findings and quantified range-of-motion deficits to survive a defense motion for summary judgment.
- How does no-fault insurance work in NY?
New York's no-fault system, governed by Insurance Law § 5102, requires every registered vehicle to carry Personal Injury Protection (PIP) coverage that pays up to $50,000 per person for medical expenses, lost wages, and certain other economic losses regardless of who caused the crash. You file that claim with your own insurer, not the at-fault driver's, so basic bills get covered quickly without waiting for liability to be sorted out. The tradeoff is that the law limits your right to sue. To step outside the no-fault system and bring a tort claim against the responsible driver, you must meet the serious injury threshold defined in Insurance Law § 5102(d).
- What are the disadvantages of no-fault insurance?
The $50,000 PIP cap under Insurance Law § 5102 often falls far short of covering serious medical treatment, lost wages, and out-of-pocket costs after a significant crash. Because no-fault benefits are paid regardless of who caused the accident, a driver who was entirely at fault receives the same baseline coverage as an innocent pedestrian or cyclist. The cap is particularly inadequate for injuries requiring surgery, long-term rehabilitation, or home care. Injured people are left to pursue additional compensation only if they can clear the serious injury threshold under Insurance Law § 5102(d), a legal standard that defense lawyers and insurance carriers contest aggressively.
- Who pays the excess in a no-fault claim?
When medical bills and lost wages exceed the $50,000 basic economic loss limit under Insurance Law § 5102(a), the excess falls outside what no-fault PIP will cover. At that point, you may pursue a claim directly against the at-fault driver's liability insurance for those additional economic losses, provided your injuries meet the serious injury threshold in Insurance Law § 5102(d). If the at-fault driver carries insufficient liability coverage, your own underinsured motorist (UIM) coverage, if you purchased it, can step in to cover the gap. In cases involving commercial vehicles, FMCSA minimum coverage requirements often mean higher policy limits are available.
- What are the disadvantages of no-fault?
New York's no-fault system, governed by Insurance Law § 5102, caps personal injury protection (PIP) benefits at $50,000 per person, which can fall far short of covering serious medical treatment, lost wages beyond the basic benefit, and other out-of-pocket costs after a significant crash. Because no-fault benefits are paid regardless of who caused the accident, a driver who was entirely at fault receives the same baseline coverage as an innocent pedestrian or cyclist, which many people find fundamentally unfair. The $50,000 ceiling is particularly inadequate for injuries requiring surgery, long-term rehabilitation, or home care, leaving injured people to pursue additional compensation only if they can clear the serious injury threshold defined under Insurance Law § 5102(d), a legal standard that itself requires medical documentation and litigation to establish. No-fault also does not compensate for non-economic losses like pain and suffering unless that threshold is met, meaning many people with genuine but hard-to-document injuries walk away without full recovery. If you've been hurt in a New York motor vehicle accident and you're unsure whether your injuries qualify for a lawsuit beyond no-fault, speaking with an attorney about your specific circumstances is the right first step.
- What does no-fault insurance not cover?
New York's no-fault system, governed by Insurance Law § 5102, pays up to $50,000 per person for medical expenses and a portion of lost wages after a car accident, but it leaves several significant gaps. It does not cover pain and suffering, emotional distress, or any compensation for how an injury affects your daily life, which means those damages are only recoverable through a third-party lawsuit if your injuries meet the serious injury threshold defined in Insurance Law § 5102(d). Property damage to your vehicle is also excluded from no-fault coverage and must be pursued through a separate collision or property damage claim. Lost earnings beyond the statutory 80% cap, out-of-pocket expenses exceeding the $50,000 limit, and the costs of long-term care or rehabilitation that surpass policy limits are likewise not covered. If your injuries qualify as serious under § 5102(d), such as a fracture, significant disfigurement, or a significant limitation of use of a body function or system, an attorney can help you pursue the full range of damages that no-fault simply doesn't reach.
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Antin, J. S. (2026, March 2). New York's Crash Payout Cap Hasn't Moved Since 1973.. AEE Law Insights. https://aeelaw.com/insights/ny-no-fault-insurance-explained/
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