MAUGHAN, Justice:
Before us is a matter involving our “no-fault” insurance act. It was resolved, by summary judgment, in favor of plaintiff Allstate Insurance Company. We reverse and remand. Costs awarded to defendant Ivie.
Defendant, hereinafter “Ivie,” sustained severe personal injuries in a motor vehicle accident. Allstate Insurance Company, the plaintiff herein, was the “no-fault” insurance carrier for the vehicle in which Ivie was a passenger. In compliance with the Utah Automobile No-Fault Insurance Act, Section 41, Title 31, U.C.A.1953, as enacted 1973, Allstate paid Ivie PIP (personal injury protection) benefits amounting to the sum of $7,394.00. Thereafter, Ivie filed an action for damages against James Salisbury, the driver of the other motor vehicle involved in the accident. Salisbury’s liability insurer was Travelers Insurance Company. Allstate declined to join in or participate in the lawsuit, although it asserted it had sub-rogation rights to the extent of the PIP benefits it had paid.
The trial of the negligence action was set for April 11, 1978. In March 1978, Travelers offered to settle for $44,000. Travelers’ liability was limited to $50,000 under the policy. Ivie’s counsel was employed under a contingency fee arrangement, viz., twenty-five percent prior to actual trial preparation and one third if the case were settled immediately before or during the trial, or went to judgment. Additionally, Ivie was responsible for all costs and expenses incurred in the prosecution of her claim. After reviewing the deposition of tort-feasor Salisbury, and further investigation, Ivie determined there would be a limited opportunity to collect a judgment in excess of the liability policy limit of $50,000, although Ivie claimed $150,000 in damages. Under these circumstances, Ivie accepted a settlement of $44,000; thus she limited her attorney’s fees to twenty-five percent. Travelers issued two drafts: one was made payable jointly to Allstate and Ivie in the sum of $7,394.00; the other was for the balance of the $44,000 settlement. Ivie refused to deliver the check for $7,394.00 to Allstate, and the present action was filed.
In its complaint, Allstate pleaded in the alternative that it was entitled to subrogation under the contractual terms of the policy issued on the vehicle in which Ivie was a passenger to the extent it had paid the PIP benefits, or it was entitled to reimbursement under Section 31-41-11, U.C.A. 1953, enacted in 1973. Allstate further pleaded for a declaration of its rights in regard to Ivie’s recovery as a result of the settlement of her tort action. Allstate moved for summary judgment.
Ivie opposed the summary judgment on the ground there were triable issues of fact. Ivie urged equitable principles apply to sub-[1199]*1199rogation, and the insured is entitled to be made whole before the insurer is entitled to any portion of the recovery from the tort-feasor. Ivie argued she sustained severe injuries and was compelled to settle for a sum totally inadequate to compensate her for the total damages sustained. According to her argument, to prevail Allstate must prove it has a greater equity than Ivie, which, in effect, would require proof Ivie had received double payment for her medical expenses.1
Ivie further urged, if Allstate were entitled to its subrogation claim, it should contribute to the costs and attorney’s fees incurred by Ivie in collecting the claim. Ivie cites the principle that in the absence of an agreement to the contrary as set forth by the terms in a policy of insurance, the insured, who is successful in the recovery of funds which include money payable by the insured to an insurance company, is entitled to deduct attorney fees and other expenses reasonably and necessarily incurred in making such a recovery from the amount payable to the insurance company.2
The trial court granted Allstate’s motion for summary judgment. Specifically, the court granted Allstate judgment against Ivie and Travelers jointly and severally in the sum of $7,394.00. The court declared Travelers was bound by the provisions of Section 31^41-11, and Ivie was not entitled to an attorney’s fee from Allstate.
To resolve the issues between the parties, it is essential to construe Section 31 — 41—11; however, this section cannot be construed in isolation, but must be correlated with other pertinent provisions in Chapter 41 of Title 31, Utah Automobile No-Fault Insurance Act. As an aid to the proper construction of this act, reference to an article by Robert E. Keeton in the 1973 Utah Law Review is beneficial, Compensation Systems and Utah’s No-Fault Statute, 1973 ULR 383. Therein, it is explained that twenty-one states have enacted “no-fault” legislation. These laws are of two types: first, the add-on statutes; and second, the partial tort exemption statutes. The add-on statutes merely add to the negligence system of reparations with some kind of no-fault benefits to an injured person, without regard to fault. All tort claims are preserved under these statutes, although some provide for subrogation or offset to avoid double recovery for an item of loss. These add-on laws are not regarded as true “no-fault” legislation. '
The true “no-fault” insurance is a type of compensation system which couples the payment of benefits on a no-fault basis with the partial elimination of fault-based tort actions for both economic losses and pain and suffering. This system generally continues to permit fault-based claims for pain and suffering in the more serious cases and for economic losses above no¡-fault benefits. A system which has no tprt exemption at all is not a “no-fault”! insurance. The Utah no-fault statute is a compulsory, partial tort exemption law coupling no-fault insurance benefits, Section 6, with a partial elimination of tort claims for bodily injury.
Section 2 of the act provides:
The purpose of this act is to ¡require the payment of certain prescribed!benefits in respect to motor vehicle' accidents through either insurance or. other approved security, but on the basis of no fault, preserving, however, the right of an injured person to pursue the customary tort claims where the most serious type of injuries occur .
(1) No person for whom direct benefit coverage is provided for in this act shall be allowed to maintain a cause of action for general damages arising out of personal injuries alleged to have been caused by an automobile accident except where there has been caused by this accident any one or more of the following:
[1200]*1200(a) Death;
(b) Dismemberment or fracture;
(c) Permanent disability;
(d) Permanent disfigurement; or
(e) Medical expenses to a person in excess of $500.
(2) The owner of a motor vehicle with respect to which security is required by this act who fails to have such security in effect at the time of an accident shall have no immunity from tort liability and shall be personally liable for the payment of the benefits provided for under Section 31-41 — 6. [Emphasis supplied].
Under this statutory plan, first party PIP benefits up to the amounts provided in Section 6 are paid to an injured person without regard to fault.
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MAUGHAN, Justice:
Before us is a matter involving our “no-fault” insurance act. It was resolved, by summary judgment, in favor of plaintiff Allstate Insurance Company. We reverse and remand. Costs awarded to defendant Ivie.
Defendant, hereinafter “Ivie,” sustained severe personal injuries in a motor vehicle accident. Allstate Insurance Company, the plaintiff herein, was the “no-fault” insurance carrier for the vehicle in which Ivie was a passenger. In compliance with the Utah Automobile No-Fault Insurance Act, Section 41, Title 31, U.C.A.1953, as enacted 1973, Allstate paid Ivie PIP (personal injury protection) benefits amounting to the sum of $7,394.00. Thereafter, Ivie filed an action for damages against James Salisbury, the driver of the other motor vehicle involved in the accident. Salisbury’s liability insurer was Travelers Insurance Company. Allstate declined to join in or participate in the lawsuit, although it asserted it had sub-rogation rights to the extent of the PIP benefits it had paid.
The trial of the negligence action was set for April 11, 1978. In March 1978, Travelers offered to settle for $44,000. Travelers’ liability was limited to $50,000 under the policy. Ivie’s counsel was employed under a contingency fee arrangement, viz., twenty-five percent prior to actual trial preparation and one third if the case were settled immediately before or during the trial, or went to judgment. Additionally, Ivie was responsible for all costs and expenses incurred in the prosecution of her claim. After reviewing the deposition of tort-feasor Salisbury, and further investigation, Ivie determined there would be a limited opportunity to collect a judgment in excess of the liability policy limit of $50,000, although Ivie claimed $150,000 in damages. Under these circumstances, Ivie accepted a settlement of $44,000; thus she limited her attorney’s fees to twenty-five percent. Travelers issued two drafts: one was made payable jointly to Allstate and Ivie in the sum of $7,394.00; the other was for the balance of the $44,000 settlement. Ivie refused to deliver the check for $7,394.00 to Allstate, and the present action was filed.
In its complaint, Allstate pleaded in the alternative that it was entitled to subrogation under the contractual terms of the policy issued on the vehicle in which Ivie was a passenger to the extent it had paid the PIP benefits, or it was entitled to reimbursement under Section 31-41-11, U.C.A. 1953, enacted in 1973. Allstate further pleaded for a declaration of its rights in regard to Ivie’s recovery as a result of the settlement of her tort action. Allstate moved for summary judgment.
Ivie opposed the summary judgment on the ground there were triable issues of fact. Ivie urged equitable principles apply to sub-[1199]*1199rogation, and the insured is entitled to be made whole before the insurer is entitled to any portion of the recovery from the tort-feasor. Ivie argued she sustained severe injuries and was compelled to settle for a sum totally inadequate to compensate her for the total damages sustained. According to her argument, to prevail Allstate must prove it has a greater equity than Ivie, which, in effect, would require proof Ivie had received double payment for her medical expenses.1
Ivie further urged, if Allstate were entitled to its subrogation claim, it should contribute to the costs and attorney’s fees incurred by Ivie in collecting the claim. Ivie cites the principle that in the absence of an agreement to the contrary as set forth by the terms in a policy of insurance, the insured, who is successful in the recovery of funds which include money payable by the insured to an insurance company, is entitled to deduct attorney fees and other expenses reasonably and necessarily incurred in making such a recovery from the amount payable to the insurance company.2
The trial court granted Allstate’s motion for summary judgment. Specifically, the court granted Allstate judgment against Ivie and Travelers jointly and severally in the sum of $7,394.00. The court declared Travelers was bound by the provisions of Section 31^41-11, and Ivie was not entitled to an attorney’s fee from Allstate.
To resolve the issues between the parties, it is essential to construe Section 31 — 41—11; however, this section cannot be construed in isolation, but must be correlated with other pertinent provisions in Chapter 41 of Title 31, Utah Automobile No-Fault Insurance Act. As an aid to the proper construction of this act, reference to an article by Robert E. Keeton in the 1973 Utah Law Review is beneficial, Compensation Systems and Utah’s No-Fault Statute, 1973 ULR 383. Therein, it is explained that twenty-one states have enacted “no-fault” legislation. These laws are of two types: first, the add-on statutes; and second, the partial tort exemption statutes. The add-on statutes merely add to the negligence system of reparations with some kind of no-fault benefits to an injured person, without regard to fault. All tort claims are preserved under these statutes, although some provide for subrogation or offset to avoid double recovery for an item of loss. These add-on laws are not regarded as true “no-fault” legislation. '
The true “no-fault” insurance is a type of compensation system which couples the payment of benefits on a no-fault basis with the partial elimination of fault-based tort actions for both economic losses and pain and suffering. This system generally continues to permit fault-based claims for pain and suffering in the more serious cases and for economic losses above no¡-fault benefits. A system which has no tprt exemption at all is not a “no-fault”! insurance. The Utah no-fault statute is a compulsory, partial tort exemption law coupling no-fault insurance benefits, Section 6, with a partial elimination of tort claims for bodily injury.
Section 2 of the act provides:
The purpose of this act is to ¡require the payment of certain prescribed!benefits in respect to motor vehicle' accidents through either insurance or. other approved security, but on the basis of no fault, preserving, however, the right of an injured person to pursue the customary tort claims where the most serious type of injuries occur .
(1) No person for whom direct benefit coverage is provided for in this act shall be allowed to maintain a cause of action for general damages arising out of personal injuries alleged to have been caused by an automobile accident except where there has been caused by this accident any one or more of the following:
[1200]*1200(a) Death;
(b) Dismemberment or fracture;
(c) Permanent disability;
(d) Permanent disfigurement; or
(e) Medical expenses to a person in excess of $500.
(2) The owner of a motor vehicle with respect to which security is required by this act who fails to have such security in effect at the time of an accident shall have no immunity from tort liability and shall be personally liable for the payment of the benefits provided for under Section 31-41 — 6. [Emphasis supplied].
Under this statutory plan, first party PIP benefits up to the amounts provided in Section 6 are paid to an injured person without regard to fault. Furthermore, the injured party is precluded from maintaining an action to recover general damages (all damages other than those awarded for economic losses),3 except where the threshold requirements of Section 9(1) are met. Under Section 9(2), there are two consequences to the owner of a motor vehicle who fails to have the security required by Section 5: first, he has no immunity from tort liability; second, he is personally liable for the benefits provided under Section 6. The only logical inference is that if a party has the security required under Section 5, the no-fault insurance act confers two privileges: first, he is granted partial tort immunity; second, he is not personally liable for the benefits provided under Section 6. He does, however, remain liable for customary tort claims, viz., general damages and economic losses not compensated by the benefits paid under Section 6, where the threshold provisions of Section 9(1) are met.
There is no provision in the statutory scheme to indicate the tort-feasor who has complied with the security provisions of the act, becomes personally liable for the PIP benefits provided in Section 6, when the injured party is entitled under the threshold provisions of Section 9(1) to maintain a claim for personal injuries. In such a situation, the injured party should plead only for those damages for which he has not received reparation under his first party insurance benefits. In order to present a completely factual picture to the jury, the injured party may wish to present evidence of all his medical bills or other economic losses. The court, by an appropriate instruction, could explain to the jury that these economic losses have not been included in the prayer for damages, because the injured party has previously received reparation under his own no-fault insurance coverage.
The foregoing interpretation is the only one consistent with the provisions in Section 9(2). The obvious legislative intent was to encourage compliance with the security provisions of the act. The design to compel compliance included not only partial tort exemption, but immunity from personal liability for payment of the benefits provided for under Section 6.
When Section 9(2) is construed in conjunction with Section 9(1), the legislative intent emerges.
No person for whom direct benefit coverage is provided for in this act shall be allowed to maintain a cause of action for general damages . . . except where
Until the threshold requirements are met, the injured party is limited to his direct benefit coverage. If his injuries meet the threshold requirements, then he may maintain a claim for general damages. The term “general damages” is explained as follows:
Another interesting feature of the Utah law is its distinctive phrasing of the tort exemption provision, which declares: “No person for whom direct benefit coverage is provided for in this act shall be allowed to maintain a cause of action for general damages unless one of the threshold requirements is met.” The term “general damages” is not defined in the statute. The tort exemption provisions of other statutes, rather than referring to [1201]*1201“general damages” have used phrases such as “pain and suffering” or “pain, suffering, mental anguish, and inconvenience,” or have used especially defined term such as noneconomic detriment. The term “general damages” was often used, in public discussion of no-fault proposals, as a comprehensive term for elements of tort damages other than economic losses, which were often referred to as “specials.” In view of that usage, it would seem that “general damages” as used in the Utah statute includes damages for pain and suffering. It may reasonably be argued that “general damages” refers more broadly to all damages other than those awarded for economic losses and that preclusion of “general damages” precludes also any award for disability as such (including for example, disability to play golf), as distinguished from an award reimbursing economic losses resulting from the disability.4
Thus, under Section 9(1) and (2), the tort-feasor has partial immunity for general damages until the threshold provisions are met and no personal liability for the payment of the benefits provided under Section 6, if he has complied with the security requirements of the act.
Section 11 must be construed in connection with the other relevant provisions. Section 31-41-11 provides:
(1) Every insurer authorized to write the insurance required by this act shall agree as a condition to being allowed to continue to write insurance in the State of Utah;
(a) That where its insured is or would be legally liable for the personal injuries sustained by any person to whom benefits required under this act have been paid by another insurer, including the state insurance fund, it will reimburse such other insurer for the payment of such benefits, but not in excess of the amount of damages so recoverable, and
(b) That the issue of liability for such reimbursement and the amount of same shall be decided by mandatory, binding arbitration between the insurers.
Section 11 is not a model of clarity. A degree of confusion has been generated by the subtitle to this section supplied by the publisher of the Utah Code Annotated, The Allen Smith Company. The subtitle reads: “Subrogation rights and arbitration between insurers.” In contrast, the subtitle in the session laws, Laws of Utah, 1973, Regular Session, Chapter 55, reads: “Conditions insurers to abide by.”
In reference to Section 11, Keeton states:5
The Utah law preserves subrogation-like rights of reimbursement among no-fault insurers. That is, after an insurer pays no-fault benefits, it is entitled to reimbursement from the insurer of a negligent driver who would have been liable in tort to the injured person but for the partial tort exemption. These claims for reimbursement are declared to be subject to mandatory, binding arbitration between the insurers. This would appear to be an undesirable preservation of fault based claims among insurers. It may happen, however, that the provision will fall into disuse in practice. For example, two insurers with a large volume of claims against each other may agree to square accounts periodically on an actuarial basis, or even to forego these reimbursement claims against each other altogether, because it would be cheaper for both to do so.
The state of Oregon has a provision similar to Section 11, viz., ORS 743.825. It should be emphasized that Oregon has an add-on statute with no partial tort exemption.6 Oregon further requires the injured person to include in his claim or legal action the benefits furnished by the insurer, ORS 743.828(3)(b). By a separate statute, there is a provision in Oregon for subrogation. ORS 743.830 provides:
[1202]*1202If a motor vehicle liability insurer has furnished personal injury protection benefits .
(1) The insurer is entitled to the proceeds of any settlement or judgment that may result from the exercise of any rights of recovery of the injured person against any person legally responsible for the accident, to the extent of such benefits furnished by the insurer less the insurer’s share of expenses, costs and attorney fees incurred by the injured person in connection with such recovery.
(2) The injured person shall hold in trust for the benefit of the insurer all such rights of recovery which he has, but only to the extent of such benefits furnished.
(3) The injured person shall do whatever is proper to secure, and shall do nothing after loss to prejudice, such rights.
(4) If requested in writing by the insurer, the injured person shall take, through any representative not in conflict in interest with him designated by the insurer, such action as may be necessary or appropriate to recover such benefits furnished as damages from such responsible person, such action to be taken in the name of the injured person, but only to the extent of the benefits furnished by the insurer. In the event of a recovery, the insurer shall also be reimbursed out of such recovery for the injured person’s share of expenses, costs and attorney fees incurred by the insurer in connection with the recovery.
(5) In calculating respective shares of expenses, costs and attorney fees under this section, the basis of allocation shall be the respective proportions borne to the total recovery by:
(a) Such benefits furnished by the insurer; and
(b) The total recovery less (a).
(6) The injured person shall execute and deliver to the insurer such instruments and papers as may be appropriate to secure the rights and obligations of the insurer and him as established by this section.
(7)Any provisions in a motor vehicle liability insurance policy or health insurance policy giving rights to the insurer relating to subrogation or the subject matter of this section shall be construed and applied in accordance with the provisions of this section.
This latter section would be a redundancy if Section 743.825 of the Oregon code provided for subrogation by the no-fault insurer to its insured, when such insured received a settlement or judgment for personal injuries. Similarly, Section 11 in the Utah No-Fault Insurance Act cannot be interpreted as conferring on the no-fault insurer a right of subrogation to the funds received by its insured for personal injuries. Section 11 grants the no-fault insurer a limited, equitable right to seek reimbursement in arbitration proceeding against the liability insurer. Section 11 cannot be deemed as conferring subrogation rights on the no-fault insurer, vis-a-vis its insured as to his recovery in a settlement or legal action. ■
The nature and purpose of subrogation should be reviewed. Subrogation is a creature of equity, its purpose is to work out an equitable adjustment between the parties by securing the ultimate discharge of a debt by the person who, in equity and in good conscience, ought to pay it. Subro-gation has a dual basis — ". . . when the insurer has made payment for the loss caused by a third party, it is only equitable and just that the insurer should be reimbursed for his payment to the insured, because otherwise either the insured would be unjustly enriched by virtue of a recovery from both the insurer and the third party, or in the absence of such double recovery by the insured, the third party would go free notwithstanding the fact that he has a legal obligation in connection with the damage.7 ”
Under the Utah No-Fault Insurance Act, the tort-feasor who has the required security, is not personally liable to the in[1203]*1203jured person for payment of Section 6 benefits, Section 9(2); therefore, the tort-feasor has no personal legal obligation to reimburse the injured party’s insurer. On the other hand, the tort-feasor’s liability insurer, in fulfilling its duty to respond to the claims of the injured party to the limits of its policy, stands in the shoes of its insured and pays on the basis of its insured’s personal liability to the tort victim; this personal liability does not include PIP payments. Thus, the tort victim’s recovery from the liability insurer cannot be reduced by the PIP payments. If the victim’s recovery be reduced by the amount of the PIP payments by «granting his no-fault insurer a right of subrogation, it is the no-fault insurer who receives double recovery. This is so because the insurer receives a premium for the benefits, and then receives full reimbursement, while the liability insurance available to recompense the victim is depleted by payments for which the liability insurer is not responsible to the victim.
In the instant action, Allstate has no right of subrogation to the recovery of I vie, and the trial court erred in its ruling. The cause is remanded with an order to enter judgment in favor of Ivie in the amount of $7,394.00, the sum representing the PIP payments. However, Allstate is not precluded from claiming reimbursement from Travelers in an arbitration proceeding.
WILKINS, J., concurs.