Do I really need PIP car insurance?
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UPDATED: Mar 13, 2020
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Personal Injury Protection (PIP) coverage pays for medical expenses an insured driver incurs as a result of an auto accident. Depending on the state, PIP coverage may be required by law; in states where it’s not required, it may still be a good idea to purchase PIP coverage. Personal Injury Protection is a very versatile insurance coverage and can be used in a variety of situations.
What States Require PIP Protection?
Car insurance is governed by state laws, and individual requirements vary from one state to the next. In regards to injuries, all states are either no-fault states or tort states. In a no-fault state, a person’s auto insurance policy is expected to cover the majority of expenses related to an auto claim and injuries resulting from that claim. In tort states, the responsible party’s car insurance company pays for medical expenses for the not-at-fault person, and the injured person can pursue legal action against the other driver.
Most states are tort states, but there are several no-fault states as well: Florida, New Jersey, New York, Pennsylvania, Hawaii, Kansas, Kentucky, Massachusetts, Utah, North Dakota and Minnesota all have some degree of no-fault legislature. In these states, it is usually mandatory to carry some form of first-party medical coverage. Depending on the state, this coverage is called either Medical Payments Coverage or Personal Injury Protection. Medpay insurance usually has higher limits and a deductible, whereas PIP coverage usually has no deductible and lower limits, but the exact coverage varies from one state to the next.
What does PIP Insurance cover?
Personal Injury Protection coverage is very flexible. Unlike other types of coverage, PIP follows the insured regardless of what vehicle is in use at the time of the accident. This means that a person can utilize PIP coverage to pay for injuries incurred while driving a borrowed vehicle or even as a passenger in another person’s auto. There are several occasions when a claim can be filed against PIP coverage:
— If someone is injured while operating his own vehicle. The most obvious use of PIP coverage is to pay for injuries sustained in a car accident involving the insured auto. In this case, PIP would be opened alongside collision, liability and any other damage coverage listed on the policy.
— If someone is injured while in another person’s vehicle. Whether driving a borrowed vehicle or riding as a passenger in a friend’s car, an insured can file an injury claim against his own PIP coverage. The bodily injury liability of the vehicle’s owner should be primary in most cases, but PIP coverage can help fill in the gaps.
— If a person is hit as a pedestrian or bicyclist. Injuries incurred by a vehicle will be paid under PIP, even if the insured was not in a vehicle at the time of the accident. In these claims, the bodily injury liability insurance of the person in the car should be primary for paying for injuries, but pedestrians or bicyclists are sometimes found to be at fault for these accidents so PIP coverage can be used if a claim is denied or if there is not enough liability coverage to pay for all expenses.
— Any other vehicle-related injuries not caused by an accident. Someone who falls while entering or exiting a vehicle can file a claim under PIP coverage. This is also true of people who are injured while repairing a vehicle. In these claims, PIP is the only coverage opened unless the vehicle somehow sustained damage as well.
After the claim is filed, a PIP adjuster will be assigned to review the situation. The adjuster will be able to discuss the policy limits in detail and explain any deductibles that may apply. Some PIP coverage is designed primarily to help augment regular medical insurance, while other policies have a more expansive scope.
For people living in states where PIP is not required, it may still be a good idea to purchase this type of coverage. PIP covers everyone who lives with the insured as well as drivers listed on the policy, so it provides excellent protection for college students who may be injured while away at school. It can also be purchased independently of other coverage, so it’s possible to buy PIP without carrying full coverage auto insurance. This will keep costs down without sacrificing peace of mind and protection against medical expenses.