Each state has its set of unique regulations on auto insurance. Some states are called “fault” states, while others are regarded as “no-fault” states. Auto accidents affect many individuals annually, and the associated medical expenses can quickly add up. Suppose you are one of the countless individuals without personal injury protection (PIP) coverage.
In that case, you could be responsible for tens or even hundreds of thousands of dollars in medical expenses if you are injured in a car accident.
Even if you obtain PIP auto insurance for the first time or file a PIP claim, the following information will be helpful. Personal Injury Protection is complicated because policy and state standards vary widely. You rarely know when a car accident will occur; thus, below are how PIP insurance might benefit you after an accident.
Personal Injury Protection (PIP) Insurance: What Is It?
PIP, personal insurance protection (also known as no-fault), is a type of auto insurance that pays medical bills, funeral costs, lost income, and other expenditures following an automobile accident, regardless of who was at fault. You need to have this coverage. It is affordable, and most states offer it without any difficulties. Even if it is not mandatory, it is strongly recommended.
How It Operates
Personal injury protection (PIP) insurance reimburses drivers, up to a specified amount, for medical bills, rehabilitation costs, funeral costs, and other accident-related expenses. This compensation applies to both the driver and their passengers. After submitting a claim for an accident, the policyholder receives protection coverage compensation regardless of who was at fault.
In jurisdictions where drivers are required to have PIP insurance as part of their auto insurance policy, the motorist must first file a claim. Suppose you buy cheap South Carolina auto insurance and file a claim. In that case, the selected carrier will offer compensation per the state mandate.
Based on the state, these criteria could be either monetary or verbal. A monetary threshold indicates that the expenses incurred by the injuries must exceed a specific dollar amount. In contrast, a verbal criterion suggests that the injuries must meet a certain level of severity. In general, severity level denotes the loss of a physical function or permanent harm. In severe injuries, the driver’s PIP coverage may be insufficient to cover the costs.
However, most minor injury claims do not exceed the state-mandated limit. After meeting this minimum threshold, the motorist may file a claim with the other driver’s insurance company or pursue a lawsuit against the other driver to compensate for their injuries.
What PIP covers
As stated, personal injury protection can cover medical bills, lost income, death benefits, and even burial costs if you or your passengers are injured in a car accident. Here’s a closer look at what filing a PIP claim entails:
Personal injury protection pays for medical expenses incurred by you, your passengers, and anyone mentioned on your insurance policy. However, PIP does not cover costs covered by health insurance. PIP protects you even if you are not driving at the time of the accident; an ideal illustration is when you are hit by a car while crossing the street. Other medical aspects PIP touches include;
- Surgery, nursing, emergency treatment, X-rays, prescriptions, and dental care
- Prosthetic devices
- Therapy, rehabilitation, and remedial care
- Psychiatric and psychological care
- Optometry services
- Speech and audiology services
- Ambulance services
- Non-medical treatment consistent with your religious convictions
PIP insurance can cover a portion of your lost income if you cannot work due to an automobile accident-related injury. However, not every vehicle insurance company offers this portion of PIP insurance, and adding it to your coverage may incur additional fees.
Your insurance may limit the number of lost wages you can claim, although each insurer offers different conditions. Typically, insurers cover up to 80% of lost wages, up to a defined maximum. If you have a deductible, the amount of your deductible will also be deducted from your refund. It is easy to be reimbursed for less if you obtain social benefits, such as worker’s compensation or Social Security disability insurance, depending on state law.
- Death benefit
Personal injury protection policy can pay a fair amount, known as a death benefit, to the surviving family members of a person killed in an automobile accident. Typically, the sum is capped at a certain cash amount or the balance of unused PIP payments.
In contrast, if you already have life insurance, the death benefit provided by PIP coverage may appear inadequate. Since life insurance also provides coverage if you die in an auto accident, the PIP clause for death benefits is unnecessary if you can afford a term life insurance policy.
As with the death benefit clause, the PIP coverage of your auto insurance may also pay for funeral expenses, subject to the policy’s limitations. The funeral expenses clause of your PIP policy may not be sufficient to pay all funeral expenditures. In this case, cheap life insurance coverage may be a preferable option.
Your PIP policy may reimburse you for child care, lawn care, and house cleaning services if your injury prevents you from performing them while you heal.
Who else is covered by PIP insurance?
Typically, auto insurance follows the vehicle and not the driver, but PIP is special because it can cover you and the other drivers on your policy while you’re not driving. PIP, or no-fault insurance, provides coverage for the following parties:
- You, the person insured by the policy, while you are in your car or if you are hit by another automobile
- Any of your immediate family members when they are in your vehicle or when hit by another car
- Any passengers wounded while in your car
Even if you were not in the vehicle at the time of the accident, PIP might cover your spouse’s medical expenses if they are struck by another driver or hit a pole.
PIP covers a broad spectrum of victims. PIP is carried with you. Your PIP will still cover your medical expenses and lost income whenever you are injured while riding in someone else’s vehicle. Similarly, suppose someone is wounded in your car during an accident. In that case, so long as that person owns a car, that person’s PIP will cover their medical expenses, which could reduce your responsibility.
Sometimes you might not even own a vehicle but live with a family member who does; the family member’s PIP policy will cover your medical expenses. PIP would cover you even if a pedestrian or biker struck bis y a car. In some situations, it also covers your children if they are injured in an accident.