The Pennsylvania Motor Vehicle Financial Responsibility Law (“MVFRL”) came into effect on July 1, 1990, and remains Law to this day. Under this law, drivers get to choose a “tort option” when buying auto insurance, “Full Tort” and “Limited Tort.”  

A driver who chooses the Limited Tort option signs away their right to sue for injuries sustained in a car crash unless those injuries are “serious injuries” as defined in 75 PA. C.S. 1702: “A personal injury resulting in death, serious impairment of body function or permanent serious disfigurement.”  

Drivers who elect the Full Tort option retain the right to sue for all injuries, even ones that don’t rise to the level of death, disfigurement, or serious impairment.

For the insurance companies, this means that there are two classes of drivers out there, people who have full rights to sue them and people who have limited rights to sue them. Of course the insurance companies would love it if everyone had limited rights to sue, and in fact that they reward drivers who choose limited tort with an average 15.3 percent lower premium than a similar full tort policy.

But is that a good deal for you, the driver? You are saving some money, but you are signing away some rights. What are those rights? What are they worth?

First, let us speak about what you “get” for choosing limited tort coverage.

Depending on who you ask, the average annual cost of auto insurance in Pennsylvania is between $878 and $1433. Using the 15.3% reduction in premium figure I cited above, this translates into an annual savings of $132-$215.

What do you give up to get that money?

In layman’s terms, you are giving up your right to sue for “whiplash” type injuries. In my experience, these whiplash type cases commonly settle in the $5,000 to $7,000 range. Assuming attorneys’ fees on the high end, that would be $3,000 to $4,200 to the driver/client.

The Cost-Benefit Analysis

 If you divide the high estimate of annual savings ($215) into the low-end value of the right to sue that you sign away by taking limited tort ($3,000) you would have to go 14 years without being hit by someone for the insurance savings to even equal the right to sue you signed away by taking limited tort.  

Verdict:  Limited Tort policies are not a fair deal, you are giving away more value (in terms of rights to sue) than you are getting back in terms of lower premiums.

Want to know how long you have to sue after an accident? Check out this blog on the Tort Statutes of Limitations in Pennsylvania.