What is Personal Injury Protection? – PIP Insurance Coverage

It’s important to understand what type of insurance you need according to your state laws. Among these is personal injury protection, a type of auto insurance coverage necessary when operating a vehicle.

Auto insurance companies give you plans and premiums—money paid to the insurance company for a policy.

If you sustained injuries from an auto accident, contact your auto insurance to see what benefits your policy covers. An auto attorney can also analyze your claim to guide you on earning an adequate settlement.

Despite what they say, car insurance firms want to give you the lowest settlement possible to protect their profits. If you have a lawyer by your side, you can have the legal presence to demand a settlement worthy of covering your losses.

What is PIP Insurance?

Personal injury protection (PIP) is no-fault insurance covering medical costs and lost wages for parties injured in an auto accident. This coverage extends to your passengers, even if they don’t carry insurance.

PIP covers you regardless of who is at-fault in an auto accident, mostly relevant in no-fault states. PIP is required in no-fault states and optional or not offered in other states.

Even if the other driver does not carry insurance, if you have PIP coverage, you can still receive compensation from your insurance company.

The reason why no-fault states mandate PIP auto insurance is to prevent liability disputes in court. This saves time and allows anyone involved in an accident to receive compensation for their losses.

What Does Personal Injury Protection Cover?

Personal injury protection can cover several injuries from an auto accident, such as:

• Medical expenses (surgeries, doctor appointments, medicine, etc.) for you and those covered in your policy
• Lost wages if you or your passengers cannot return to work from your injuries
• Disability and rehabilitation costs
• Necessary child care or house cleaning services
• Death benefits paid to your family from a fatal injury

PIP is used in no-fault states whereas other states may have different types of auto insurance such as liability or comprehensive coverage.

Personal injury protection covers bodily injuries, not vehicle damages. If you want coverage for your vehicle damages, seek liability insurance or comprehensive coverage.

Personal Injury Protection vs. Liability Coverage

There are multiple specific differences between personal injury protection versus liability insurance.

Liability coverage is mandatory in all states except New Hampshire, while PIP insurance is only required in 16 states. PIP auto insurance kicks in regardless of who’s at-fault, but liability coverage covers the other driver’s injuries if you’re deemed at-fault.

There are two types of damages covered under liability insurance—bodily injury and property damage liability.

In no-fault states, insurance companies can cover PIP and bodily injury liability. At-fault states require the liable driver to cover necessary expenses.

Personal injury protection is similar to liability coverage since they both cover some medical costs and lost wages. However, liability coverage also covers property impairments and additional damages like pain and suffering.

Personal Injury Protection vs. MedPay

PIP and Medpay share similar goals in covering medical expenses for you and your passengers after an auto accident.

However, the difference between the two is that PIP covers more than Medpay such as lost income, surgeries, and other major medical costs. Medpay covers doctor visits, emergency fees, or ambulance costs.

PIP and Medpay cover your medical costs despite who is at-fault and Medpay can cover additional medical expenses if PIP doesn’t fully cover all medical costs. You may consider Medpay or PIP and see which would suit your budget, medical necessities, area of risk, and state mandates.

What Does PIP Insurance Not Cover?

PIP insurance doesn’t cover all factors from an accident such as:

• Property damages (vehicle, personal belongings, public damages like roads, fences, etc.)
• Injuries to other parties when committing a crime
• Future lost income or potential increased income
• Medical care that exceeds policy limits
• Driving for work purposes as such injuries may be covered by workers’ comp insurance instead.

PIP covers injuries that result in high medical expenses, thus, any other damages do not apply. You may contact your auto insurance for more details on your type of insurance policy.

What States Require Personal Injury Protection for Drivers?

According to the Highway Loss Data Institute (HLDI), personal injury protection is sold to drivers in a no-fault state insurance system. These states include:

• Florida
• Hawaii
• Kansas
• Kentucky
• Massachusetts
• Michigan
• Minnesota
• New Jersey
• New York
• North Dakota
• Oregon
• Utah

HLDI showed statistics of PIP losses by vehicle class and size between 2018 and 2020. Two main factors determined PIP losses, claim frequency and claim severity.

HLDI data shows that losses generally decreased as vehicle size increased except for small two-door sports cars. Four-door microcars sustained the most losses, requiring a higher PIP claim.

The Benefits of Personal Injury Protection

Personal injury protection provides coverage for medical costs, lost wages, and funeral fees. Your policy limits for covering your medical expenses vary on location and size of your policy.

Also, if you damage your car or your vehicle suffers a fender bender resulting in no injuries, your PIP won’t cover this. You must have liability insurance and it’s better to add collision insurance to help pay for repairs.

How Much Does PIP Insurance Cost?

PIP insurance can cost from $50 to over $200 a year depending on your state’s laws, policies, your driving record, age, gender, and type of vehicle. The type of insurance company you go to may also affect your PIP coverage.

How to Collect PIP Insurance

The most important step in collecting PIP insurance is to seek medical attention for your injuries. You can file a claim with your insurance company and provide details of the incident after you recover.

Save all documentation such as medical bills and wage statements for evidence of losses.

Your insurance company should pay you using your PIP benefits in a reasonable time, usually within 30 days. Remember that your insurance company doesn’t pay for injuries to parties in other vehicles.

Therefore, if you are at-fault for the accident, you must use your liability insurance to cover for them. If you’re in a no-fault state, their respected insurance companies should pay for their losses.

Do You Need PIP Insurance if You Have Health Insurance?

PIP insurance may be necessary in some states that require you to have it, regardless if you have health insurance. Your state may require a small minimum of PIP insurance mandated by the state. However, health insurance doesn’t cover lost wages or accommodation in case of severe injury.

Can You File a Personal Injury Lawsuit While on PIP Insurance?

Yes, you can file a personal injury lawsuit while on PIP insurance. An auto attorney has experience reviewing your auto claim and can help you seek a higher settlement offer. In case your offer is denied, you may have your attorney dispute it in court.

Finding an auto attorney may not cost you if they work under contingency fees. This contract states that you will not pay anything unless you win and your attorney receives a portion of your total settlement.

Find a Car Crash Lawyer to Represent Your Accident

Usually, people fear working with a car crash lawyer to help them with their accident due to certain myths about litigation.

However, working with an attorney may result in a higher settlement than working with your insurance company yourself. LegalASAP can help your search for an experienced auto lawyer who knows the laws your insurance company should respect.

Submit a free short evaluation form here, and we can see if you qualify for an auto accident claim. You may contact us at 888-927-3080 for further questions or inquiries.