Personal Injury Protection Coverage
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What is Personal Injury Protection coverage?
What does Personal Injury Protection cover?
PIP covers you (the policyholder) and your passengers for several expenses related to your auto accident and recovery.
Even if you aren’t behind the wheel, PIP coverage can help pay for your injuries if you’re a passenger in another person’s car or if you’re struck by a vehicle as a pedestrian or while bicycling.
Specific expenses covered by Personal Injury Protection vary based on your insurance company, what state you live in, and your policy limits.
Examples of expenses typically covered under PIP (subject to the policy’s limits and any deductibles) include
- Hospital and medical bills for reasonable and necessary expenses (for you or someone else who was injured)
- Ambulance services
- Medical and surgical treatments
- Hospital stays
- Nursing care
- Prescriptions and other medical supplies
- Dental care
- Optical treatment
- Chiropractic services
- Rehabilitation costs. This includes physical and occupational therapy as part of your recovery.
- Childcare expenses. PIP can help with childcare costs if your injuries make it impossible for you to provide proper care for your children.
- Lost income. If you or your passengers can’t work due to injuries from an auto accident, PIP can help recover some of those wages. If you’re self-employed and your injuries require you to hire subcontractors or temporary employees, PIP can sometimes help cover those costs as well.
- Nursing care. If you need medical assistance while recovering from your injuries at home, PIP can help with the cost.
- Funeral expenses. This includes burials and cremations.
What does Personal Injury Protection not cover?
- Damage to your car
- Damage to other people’s property
- Injuries caused to other drivers involved in an accident
- Injuries sustained by accidents that are caused intentionally
- Injuries caused by an uninsured vehicle that you or an immediate family member own
- Injuries caused by accidents that occur while a driver is committing a crime
- Injuries from accidents that occur while a covered driver is using their car as part of their job
Is PIP required by law?
Auto insurance laws vary based on where you live. If you live in a no-fault state (where each person must cover their own medical expenses if they’re injured in an accident, regardless of fault), PIP coverage is mandatory, and all drivers are required to have the state’s minimum PIP coverage.
Currently, PIP coverage is required in the following 12 states1:
- New Jersey
- New York
- North Dakota
Even in states that don’t require PIP, many people choose to add it to their policies for added protection.
How much PIP coverage do I need?
The minimum amount of PIP coverage you need (if any) is determined by the state you live in.
Even if you live in a state where PIP isn’t required, it can be valuable protection in case of an accident. Choosing to go without coverage means you‘re taking on more financial risk should an accident occur.
Ultimately, how much PIP coverage you should have comes down to what works best for you.
You may also have the option to customize your coverage based on your individual needs. For example, if you live in Oregon, the mandatory minimum PIP coverage is $15,000 per person. However, you may want to consider increasing that limit, especially if you don’t have a health insurance plan
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Do I need PIP coverage if I have health insurance?
It depends. If you’re involved in a car accident and have health insurance that covers injuries and rehabilitation services, you may only need to purchase the minimum amount of PIP required by your state.
If you live in a state where PIP is optional, review your health insurance plan to determine how it covers medical expenses related to an auto accident, as well as your deductible and out-of-pocket maximums.
Ask yourself, do you have enough health or accident insurance to cover all your medical costs if you’re injured in a car accident? If you don’t have health insurance, do you have the financial resources to pay for your medical expenses out-of-pocket?
Having PIP coverage in addition to a medical plan can also be a big benefit. Health insurance is less likely to cover costs related to dental care, lost income, and childcare expenses that PIP can help cover after an accident.
Is PIP coverage the same as Bodily Injury coverage?
No. As the policyholder, PIP pays for your medical bills, as well as family members and other passengers who are injured in an accident – regardless of who’s at fault.
Bodily Injury Liability, on the other hand, covers other people’s medical expenses when you cause an accident. Bodily Injury Liability is required in almost every state.
Another difference is that PIP can cover you even if you‘re not driving. For example, if as a pedestrian a car hits and injures you, PIP may cover your medical expenses.
As a policyholder with PIP coverage, you may also receive benefits even if the other driver doesn’t have insurance.
How much does PIP coverage cost?
The cost for PIP varies based on your state, driving history, and the coverage limits and deductibles you choose. As a reference, PIP typically averages 15-20% of the total cost of your auto policy.