Lawsuit vs. zero threshold

In the context of auto insurance, the terms “lawsuit” and “threshold” are often associated with the type of coverage that determines an individual’s ability to sue for certain damages after a car accident.

1. Limited Right-to-Sue (Lawsuit Threshold): In some states, there is a concept known as the limited right-to-sue or the lawsuit threshold. Individuals who choose this option in their auto insurance policy generally have restrictions on their ability to sue for non-economic damages (such as pain and suffering) unless their injuries meet specific criteria, typically involving severity or permanence.
2. Unlimited Right-to-Sue (Zero Threshold): On the other hand, some states offer the option of an unlimited right-to-sue or a zero threshold. This means individuals have the right to sue for non-economic damages without having to meet specific criteria. Even injuries considered less severe may be subject to a lawsuit.

The choice between limited and unlimited right-to-sue often depends on the type of auto insurance policy an individual selects. Some policies allow policyholders to choose their right-to-sue option.

If you are considering these options or have questions about the thresholds, contact us today to speak with an insurance professional who can provide information specific to your jurisdiction and guide you on making the right choice based on your needs and preferences.