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What is PIP Insurance?

What is Personal Injury Protection (PIP) Insurance?

Personal Injury Protection, or PIP insurance, is an auto policy that covers medical expenses and lost wages no matter who is at fault in an accident. Personal Injury Protection can cover both the policyholder and others in the car. It differs from traditional auto insurance in these ways. PIP is offered as an additional policy option in some states while it is required in the 12 “no-fault” states and others.

PIP Insurance Image

What PIP Covers

If you’re involved in an accident and have PIP coverage, you will receive benefits as well as any other passengers involved in the accident. Medical expenses are covered regardless of who caused the accident. PIP insurance also covers any expenses related to recovery from the accident such as:

  • Lost wages
  • Home expenses like childcare and lawn care if you can’t perform them yourself
  • Transportation to and from medical appointments
  • Funeral costs

Coverage provided can vary by state. If expenses for rehabilitation exceed your maximum PIP coverage, health insurance may cover the remainder of the costs.

PIP Insurance vs Health Insurance

PIP insurance offers many benefits that health insurance does not like those listed above because it is specific to car injuries. Some of the injuries and expenses caused by accidents are not covered by health insurance.

In no-fault states that require PIP coverage, you’ll need to make a claim with the insurance company that holds your policy before going to your health insurance. If your family doesn’t have a health insurance policy, Personal Injury Protection is a great alternative. Even if you do have health insurance, the extended benefits of PIP coverage can make it worth the additional cost.

Benefits of PIP Insurance

Personal Injury Protection removes the question of blame that usually holds up insurance companies from paying out on a claim. Traditional insurance can take months to pay for medical bills. With PIP, medical expenses, and any other expenses covered, will be made available as soon as possible.

Personal Injury Protection mitigates the need for lawsuits after accidents as expenses will be paid no matter who is at fault in the crash. It will also cover you if you’re injured by an uninsured driver or are involved in a hit and run. You will also only have to interact with your personal insurance company, which can sometimes make things easier in such a stressful time.

Personal Injury Protection by State

PIP coverage is sometimes referred to as “no-fault insurance” because it is required in no-fault states. It is also required in four additional states making it required in 16 states.

Personal Injury Protection minimum requirements vary by state. Insurance companies typically only allow a maximum coverage of $25,000. What is covered also varies state-to-state. For example, acupuncture is covered in Utah but not in California.