Using Pip Auto Insurance: A Comprehensive Guide

Personal injury protection (PIP) is a type of auto insurance coverage that pays for medical expenses and lost wages resulting from a car accident, regardless of who is at fault. PIP coverage is available in 17 states and Washington, D.C., but only 12 of these states require all drivers to carry a minimum amount of PIP. The amount of coverage required varies by state, and some states allow drivers to opt out of PIP coverage in writing. PIP covers the policyholder, family members in the household, passengers in the vehicle, and others who are driving the car with permission. It can also cover you if you're injured as a pedestrian or while riding in someone else's car. In addition to medical expenses, PIP can help cover lost wages, funeral costs, and replacement services for tasks you can no longer perform due to your injuries, such as childcare or house cleaning.

What is covered by PIP auto insurance?

Personal Injury Protection (PIP) auto insurance covers medical expenses and lost wages for the insured person and their passengers in the event of an accident, regardless of who is at fault. This includes medical costs such as surgeries, medications, diagnostics (x-rays, CT scans), prosthetics, nursing care, physical therapy, and medical devices. PIP may also cover the insured person's health insurance deductible.

In addition to medical expenses, PIP can cover lost wages for the insured person and their passengers if they are unable to work due to injuries sustained in the accident. This benefit also applies to self-employed individuals who need to hire temporary workers. PIP can also help pay for essential services that the insured person would typically perform, such as childcare and house cleaning.

In the unfortunate event of a fatality, PIP insurance can help cover funeral, burial, or cremation expenses. It can also provide a death benefit to the surviving dependents of the insured person by replacing lost income.

It's important to note that PIP coverage has certain limitations and may vary by state. For example, PIP typically covers only a percentage of lost earnings, and there may be restrictions on the types of services or expenses that are reimbursed. Additionally, PIP does not cover expenses unrelated to personal injuries, such as vehicle damage, theft, or property damage.

Overall, PIP auto insurance provides financial protection for individuals and their passengers in the event of an accident, helping to cover various medical, financial, and essential service-related costs.

When is PIP auto insurance required?

Personal injury protection (PIP) is mandatory in some states and optional or not offered in others. It is also known as "no-fault insurance" and is required in 12 states.

In no-fault states, your insurance policy will cover your expenses after an accident, even if another driver was at fault. No-fault states also put restrictions on the right to sue, meaning only lawsuits that involve severe injuries can be filed. The intent of the no-fault system is to reduce the cost of auto insurance by keeping lawsuits over minor injuries out of the courtroom.

PIP is required in the following states:

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

In addition, PIP is required in Puerto Rico and is optional in Washington, D.C., and the following states:

• Arkansas
• Connecticut
• Texas
• Washington

If you live in a state where PIP is required, you must purchase it even if your existing health insurance provides similar protection. If you live in a state where PIP is optional, it may still be worth considering as it can help pay for accident-related expenses not covered by your health insurance.

When is PIP auto insurance optional?

Personal injury protection (PIP) is a type of auto insurance that covers medical expenses and related costs resulting from a car accident, regardless of who is at fault. PIP is mandatory in some states and optional in others.

In the United States, PIP is required in 15 states and Puerto Rico, including Delaware, Florida, Hawaii, Kansas, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon, Pennsylvania, Utah, and Washington. These states have "no-fault insurance" laws, which means that drivers must file a claim with their own insurance company after an accident, regardless of who caused it.

In other states, PIP is optional. These states include Arkansas, Connecticut, the District of Columbia, Pennsylvania, Texas, and Washington. In these states, drivers can choose whether to include PIP as part of their auto insurance policy.

Even in states where PIP is optional, it can still be a valuable addition to an auto insurance policy. PIP can help cover expenses such as medical bills, lost wages, rehabilitation costs, and funeral expenses. It is especially useful if you don't have comprehensive health insurance or if your health insurance plan doesn't cover injuries sustained in a car accident.

How does PIP auto insurance differ from MedPay?

Personal Injury Protection (PIP) and Medical Payments (MedPay) are both auto insurance coverages that pay for injuries to the driver and their passengers in an accident, regardless of who is at fault. However, there are some key differences between the two.

PIP is a more comprehensive coverage option, paying for various expenses in addition to medical costs. This includes lost wages, child care, household expenses, and funeral costs. PIP is also known as "no-fault insurance" and is mandatory in some states, especially those with no-fault insurance laws.

On the other hand, MedPay strictly covers medical expenses resulting from auto accidents. This includes hospital bills, surgeries, X-rays, and professional nursing care. Unlike PIP, MedPay does not cover lost wages or rehabilitation costs. MedPay is typically optional and is not available in all states.

Cost Differences

MedPay is generally cheaper than PIP, with a typical payout limit ranging from $5,000 to $10,000 per person. PIP costs can vary widely by state, ranging from a minimum of $2,500 to unlimited medical expenses and permanent injury benefits up to $250,000.

State Requirements

PIP is obligatory in most no-fault states, while MedPay is optional. In no-fault states, drivers are required to include PIP coverage in their car insurance policies. MedPay, on the other hand, is only mandatory in two states: Maine and New Hampshire.

In summary, the main differences between PIP and MedPay lie in the scope of coverage, cost, and state requirements. PIP offers more comprehensive coverage, including non-medical expenses, while MedPay focuses solely on medical expenses. MedPay is typically cheaper and optional, whereas PIP tends to be more expensive and is mandatory in certain states.

How does PIP auto insurance differ from liability insurance?

Personal Injury Protection (PIP) insurance, also known as "no-fault insurance," covers medical bills and related costs resulting from a car accident, regardless of who is at fault. It covers the policyholder, any passengers in the vehicle, pedestrians struck by the vehicle, and sometimes even the driver of another vehicle. PIP is required in 15 states and Puerto Rico, while it is optional in others.

Liability insurance, on the other hand, covers expenses incurred by third parties if the policyholder is at fault in an accident. It covers injuries caused to another party, such as a pedestrian or the driver and occupants of another vehicle, as well as damage to their property. Liability insurance is required in all states, Puerto Rico, and Washington, D.C.

In terms of what is covered, PIP insurance covers medical expenses, lost wages, and funeral costs, while liability insurance covers bodily injury to a third party and property damage. PIP has a minimum coverage amount and a per-person maximum coverage limit, while liability insurance typically has a minimum coverage requirement of $25,000 per person for bodily injuries, $50,000 per accident for bodily injuries, and $10,000 for property damage.

Another difference is that PIP is primarily available in no-fault states, where each person covers their own medical expenses after an accident, regardless of who is responsible. In contrast, liability insurance is a requirement in "at-fault" states, where the insurance company of the driver who caused the accident pays for the injuries, up to the policy limits.

Frequently asked questions