What is personal injury protection (PIP) insurance?

It’s possible that if you live in a state where personal injury protection (PIP) insurance is required, you may have extended medical care benefits that you weren’t aware of until after an accident. You may also be wondering where is PIP insurance necessary, what does it cover, and how much coverage do you require?

Continue reading for more information on what PIP insurance covers, where it is required, how much it costs, and how it relates to no-fault insurance.

What does PIP cover?

PIP insurance covers many of the health care costs you may experience due to an auto accident. Some of these covered costs are included below:

• Medical costs. PIP coverage can assist in paying for the costs of medical and surgical treatments following an accident, as well as dental and optometric treatment, ambulance and nursing services, prescription medications, and prosthetic devices. Suppose you need continuing professional medical care, such as physical therapy to help you regain your ability to walk. In that case, PIP insurance may be able to help you pay for this too.
• Lost income. If you are unable to work because of an accident-related injury, you may be able to receive compensation for lost wages.
• Household chore assistance. If your accident-related injuries make it impossible for you to work, PIP may cover the cost of a personal care assistant to help with domestic responsibilities like cooking or cleaning.
• Burial costs. Your PIP insurance may assist with, or even cover, the cost of funeral fees if you or one of your passengers dies in an accident.

It’s important to remember that PIP insurance will only cover medical expenses you’ve incurred due to your collision with another vehicle. So, you shouldn’t think of PIP as a substitute for health insurance.

In addition, unlike health insurance, the total amount of medical benefits you can claim under your PIP policy may be limited by your PIP insurance company. For example, PIP insurance policies with a $5,000 limit will not pay for any injury bills over this amount regardless of the severity.

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Where is PIP insurance required?

The following states require PIP insurance:

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

You can review the chart provided by the Insurance Information Institute (III) to find out more about compulsory auto insurance laws in your state.

How much does PIP insurance cost?

Depending on your state’s minimum requirements, the overall amount of PIP coverage you’ll require will vary. For example, in certain states, you may only need $5,000 worth of coverage, while there are others where you may require more than $50,000.

If you are unsure of your state’s minimum insurance requirements, talk to an insurance agent in your area to find the specifics.

PIP can range in price from $50 to several hundred dollars per month depending on your age, make and model of your car, and quantity of coverage. If you live in a state where PIP insurance is required, take advantage of all available discounts on auto insurance you are entitled to receive.

Do you need PIP if you have health insurance?

Regardless of whether you have health insurance or not, if you live in one of the 16 states that mandate PIP insurance, you must buy it as part of your auto insurance policy. Depending on the laws in your state, you may be required to use your PIP insurance company first before contacting your health insurer.

Even if you have health insurance and live in a state where personal injury protection is not mandatory but is offered, you may still want to invest in PIP coverage because it provides additional safeguards like lost wages and burial costs.

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How does PIP relate to no-fault insurance?

Sometimes referred to as PIP coverage or no-fault insurance, personal injury protection pays for medical expenditures regardless of who is to blame in an accident. Depending upon where you live, PIP may be optional insurance coverage or a mandated policy add-on.

Personal injury protection can cover injuries to you and your passengers regardless of who was at fault in the collision. However, differences in state regulations might make determining PIP difficult. In addition, PIP is required in several jurisdictions as part of their “no-fault auto insurance” rules, which limit your ability to sue someone for automobile accident injuries.

Each state establishes its own timeline for when you can file a lawsuit. No-fault insurance regulations typically mandate you to file lower injury claims on your PIP insurance.

Is PIP insurance right for you?

If you live in a state that requires no-fault insurance, you’ll need to purchase it as part of your auto insurance policy. If PIP insurance is not required, you still may want it because of the additional coverage, like pay for lost wages.

Know your state’s minimal PIP and liability insurance requirements and shop around to find the best value on an auto insurance policy that meets all your unique needs.

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