What is described as a "no-fault insurance system"?

A "no-fault insurance system" is best defined as an arrangement where policyholders receive compensation for their losses regardless of who is at fault. This type of system is designed to streamline the claims process and reduce the need for litigation by allowing individuals to claim benefits directly from their own insurance provider without needing to prove fault in an accident.

In such systems, policies typically cover medical costs and some lost wages, even if the insured party was responsible for the accident. This approach aims to provide a more efficient way to handle claims, ensuring that individuals receive timely compensation for their injuries and losses.

The focus is on immediate support for the affected parties instead of determining liability, which can often lead to lengthy disputes. By minimizing the adversarial nature of claims, no-fault insurance can help reduce overall costs in the insurance system and improve access to care for policyholders.