What is personal injury protection (PIP)?

Personal injury protection (PIP) insurance covers medical expenses, lost wages, and household expenses after a covered driver or their passengers are injured in a car accident. PIP is a versatile type of insurance because it covers both medical bills and indirect costs stemming from injuries sustained in a car accident. PIP stands for personal injury protection, and it can be used after any crash, regardless of who was at-fault.… read full answer

What PIP Insurance Covers

• Medical expenses
• Funeral expenses
• Lost wages
• Child care and household expenses
• Survivors’ loss for dependents
• Named drivers on the policy and their passengers

The exact details of PIP coverage may vary depending on the state and policy. For instance, some states may require you to have a deductible, and other states require specific PIP limits for funeral expenses, rehab expenses, or loss of income.

For more information and to see if PIP is required in your state, check out WalletHub’s complete guide to personal injury protection.

You need personal injury protection (PIP) insurance if you live in one of the 12 states that require it. You should also get PIP if your health insurance has low coverage limits or if you drive with passengers who could hold you responsible for their medical expenses in the event of an accident.… read full answer

In the 20 states (plus Washington, D.C.) where it is required or offered as optional protection, PIP covers medical expenses for the policyholder and his or her passengers after an accident, no matter who was at fault. However, PIP is not available at all in the 30 other states.

Always check with your insurance company or an agent for specifics on what coverage is required or available in your state before you determine what to include in your policy.

What Does PIP Cover?

• Ambulance fees
• Health insurance deductibles
• Medical treatments
• Surgery
• Rehabilitation
• Prescriptions
• Lost wages
• Home care such as cleaning or child care
• Funeral costs

If you are in a car accident, PIP often works in conjunction with your health insurance coverage. Most health insurance deductibles must be paid before benefits start to be paid out, but your PIP may have a cheaper deductible, or no deductible at all.

How Does PIP Work With MedPay?

PIP insurance may overlap with another kind of car insurance known as Medical Payments, or MedPay. Like PIP, MedPay covers the costs of medical care resulting from of an accident, no matter who was at fault. Also like PIP, MedPay covers injuries to any passengers in your car. However, it does not pay for lost wages, rehabilitation or home-care services, which PIP would cover.

The way PIP and MedPay may work together depends on your state’s laws. If you live in one of the 12 states that require PIP, MedPay could be redundant. State limits on PIP vary widely, from $3,000 in Utah to New York’s $50,000 requirement. If your state has a low upper limit on PIP, MedPay coverage could act as a beneficial supplement. In a couple states – namely, Maine and New Hampshire – MedPay is used instead of PIP.

PIP insurance works by compensating drivers up to a given limit for medical bills, rehabilitation costs, funeral costs, lost wages, and other car accident costs. PIP insurance is meant to simplify claims by requiring drivers involved in an accident to file with their own insurer, instead of establishing fault in court.… read full answer

Examples of How PIP Insurance Works

New York: PIP is required in New York, and drivers must have at least $50,000 in coverage. This includes coverage for medical bills, as well as a $2,000 death benefit for family members of someone killed in a car accident. PIP will also cover up to 80% of a victim’s lost income if they are unable to work (up to $2,000) and will provide a $25 daily payment to cover routine activities like housework.

Florida: Drivers in Florida must have at least $10,000 of PIP coverage. This means your medical expenses are covered up to $10,000, or 80% of the total bill, whichever comes first. This coverage includes a $5,000 death benefit and a payment for 60% of lost wages, up to $10,000.

PIP Requirements

PIP insurance is only required in 12 states, but you can purchase it as an add-on in other states as well. It may be useful to purchase PIP coverage even if it isn’t required since it is relatively inexpensive and will help cover your medical expenses.

If you are in the market for PIP insurance, check out WalletHub’s guide to the best PIP insurance companies.