In a no-fault insurance system, who collects the costs for medical expenses after an accident?

In a no-fault insurance system, the costs for medical expenses after an accident are primarily collected from the insurance companies of the drivers involved. This system is designed to simplify the claims process and reduce the need for legal battles over who is at fault in an accident.

Under this system, each driver’s insurance company pays for their own policyholder's medical expenses, regardless of who caused the accident. This approach can expedite access to benefits for injured parties and diminishes the burden on the legal system, allowing individuals to receive necessary medical care without waiting for fault determinations.

The other options involve scenarios that don't align with how no-fault insurance operates. In traditional liability systems, the party at fault would bear the costs, while individuals under no-fault systems typically rely on their insurance coverage. State governments are not directly involved in collecting accident costs in the same personal manner, although they may regulate insurance. Lastly, having drivers themselves cover their medical expenses would negate the purpose of insurance, which is meant to provide financial protection against such costs.