What changes legally when a car accident injury is catastrophic?
The rules on how the losses get paid start to matter. New York no-fault covers basic economic loss up to $50,000 per person, so a brain injury, spinal cord injury or amputation can use it up. If the case goes to verdict, the court enters judgment in a lump sum for past damages and for future damages up to $250,000; for an award of future damages above $250,000, the judgment is for the present value of an annuity contract that pays the remaining future damages in periodic installments. And when an injury affects an adult's ability to look after himself or herself or handle money, Mental Hygiene Law Article 81 sets the standard for a court to appoint a guardian.
Key facts
- Within the no-fault cap, necessary medical expenses (including prosthetic services, and physical and occupational therapy and rehabilitation given on a referral) are covered without limitation as to time, provided that within one year after the accident it is ascertainable that further expenses may be incurred as a result of the injury, subject to the limitations of Insurance Law § 5108.
- According to the Centers for Medicare & Medicaid Services (CMS), Medicare is a secondary payer to certain non-group health plans, which include liability insurers (including self-insured entities), no-fault insurers and workers' compensation entities.
- A finding that a person is incapacitated for guardianship purposes must be based on clear and convincing evidence.
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What happens when basic no-fault benefits run out?
According to the New York State Department of Financial Services (DFS), once basic no-fault benefits are consumed, the injured person may apply for Additional PIP benefits from the vehicle the person occupied or from any auto policy of a related member of the household; Additional PIP is an optional coverage. Insurance Law § 5102(a)(5) also provides an option to buy, for an additional premium, another $25,000 of coverage that the insured or the insured's legal representative may specify will apply to lost earnings and/or psychiatric, physical or occupational therapy and rehabilitation after the initial basic economic loss coverage is exhausted.
If no Additional PIP benefits are available, DFS says the person may make a claim to standard health insurance for medical expenses, and may also be eligible for federal Social Security Disability benefits.
Check the declarations page of every auto policy in the household early, because optional coverages only help if someone bought them.
How can your own SUM coverage help when the other driver's insurance is too small?
Supplementary uninsured/underinsured motorists (SUM) coverage is optional: a New York auto policy provides it at the option of the insured, in an amount up to the policy's bodily injury liability limits, subject to the maximums set in Insurance Law § 3420(f)(2)(A). It applies if the bodily injury liability limits of all bonds and policies of the other motor vehicle liable for damages are lower than the bodily injury liability limits of the policy providing the SUM coverage. Before the SUM insurer has to pay, the limits of all bodily injury liability bonds or policies that applied at the time of the accident must be exhausted by payment of judgments or settlements.
How is a large jury award for future damages paid?
Under CPLR Article 50-B, in calculating the past and future damages a claimant is entitled to recover, the court first applies any applicable rules of law, including set-offs, credits, comparative negligence under CPLR 1411, additurs and remittiturs.
The court's judgment directs the defendants and their insurance carriers to offer and guarantee the purchase and payment of the annuity contract. Payments run over the period of years the trier of fact determined in arriving at the itemized verdict, except that damages for pain and suffering are paid over ten years or the period the trier of fact determined, whichever is less. The first year's payment is the remaining future damages divided by the number of years of payments, and each later year's payment is the previous year's payment plus four percent. Unless otherwise agreed, each annual sum is paid in equal monthly installments, in advance.
What if the injured person can no longer manage personal needs or finances?
Under Mental Hygiene Law § 81.02, the court must determine that an appointment is necessary to provide for the person's personal needs, including food, clothing, shelter, health care or safety, and/or to manage the person's property and financial affairs, and that the person either agrees to the appointment or is incapacitated. A person is incapacitated if the person is likely to suffer harm because he or she is unable to provide for personal needs and/or property management and cannot adequately understand and appreciate the nature and consequences of that inability. In deciding whether an appointment is necessary, the court considers the court evaluator's report and whether available resources are sufficient and reliable enough to meet those needs without a guardian.
Frequently asked questions
Can you find out how much bodily injury coverage the other driver has?
If you are covered by SUM, yes. On written request by the SUM insured or an authorized representative, and once the insured discloses his or her own bodily injury and SUM limits, the insurer of the other owner or operator against whom a claim has been made must disclose its bodily injury liability limits within 45 days of the request.
If Medicare paid crash-related medical bills, does it have to be paid back?
A conditional payment does. CMS says that in some situations involving the payers Medicare is secondary to, Medicare initially pays related medical expenses so the beneficiary has timely access to needed care, and later seeks to recover those payments. That payment must be repaid to Medicare when the beneficiary receives a settlement, judgment, award or other payment from one of those payers.
Does a guardian get full control over the injured person's life?
No. An Article 81 guardian is granted only the powers necessary to provide for the person's personal needs and/or property management, in a manner appropriate to the individual, and those powers must be the least restrictive form of intervention.
About William Mattar, P.C.
William Mattar, P.C. was founded in 1990 by William K. Mattar in Williamsville, NY, and focuses on motor vehicle accident cases. The initial case consultation is free.
Related reading from William Mattar
- Catastrophic Car Accident Injuries
- What Happens When a Car Accident Exceeds Insurance Limits?
- What is Uninsured Motorist (UM) and Supplementary Underinsured Motorist (SUM) Car Insurance Coverage?
- What Does No-Fault Car Accident Insurance Cover In New York State?
- If I Sustained a Head Injury in a Car Accident, am I Entitled to a Financial Recovery?
Sources
- New York Insurance Law § 5102: https://www.nysenate.gov/legislation/laws/ISC/5102
- NYS Department of Financial Services, Consumer FAQs About No-Fault Insurance: https://www.dfs.ny.gov/consumers/auto_insurance/nofault_faqs
- New York Insurance Law § 3420: https://www.nysenate.gov/legislation/laws/ISC/3420
- CPLR § 5041 (Article 50-B): https://www.nysenate.gov/legislation/laws/CVP/5041
- New York Mental Hygiene Law § 81.02: https://www.nysenate.gov/legislation/laws/MHY/81.02
- Centers for Medicare & Medicaid Services, Non-Group Health Plan Recovery: https://www.cms.gov/medicare/coordination-benefits-recovery/overview/non-group-health-plan-recovery
Attorney Advertising. This page provides general information about New York law and is not legal advice for any specific situation. Prior results do not guarantee a similar outcome. Last updated November 2026.