Personal Injury Protection
Personal injury protection (PIP) coverage is often referred to as “no-fault car insurance," as it is the most commonly required insurance coverage among no-fault states.
“No-Fault" Insurance Defined
No-fault car insurance is a type of insurance that will help pay for your own medical costs after a car accident, regardless of who was at fault for the accident.
Several states require no-fault car insurance, or personal injury protection (PIP) coverage, as a way to protect drivers from delayed payout for personal injury claims, and to lower the amount of lawsuits related to traffic accidents.
In general, no-fault insurance restricts the policyholder's right to sue. While you can still sue if you hold this insurance type, there are state laws that determine when you are able to. For example, you may not be able to sue UNLESS one of the following applies:
- Serious death or injury occurred.
- Damages reached or exceeded a set threshold.
What Personal Injury Protection Covers
As the name implies, PIP covers the costs associated with your injuries when you get hurt in an accident.
Your specific policy and your state of residence will determine your coverage details, but typically, PIP covers the following for you and your passengers after an accident:
- Medical expenses.
- Lost wages due to injury.
- Funeral expenses.
Consult with your insurance provider or agent to learn exactly what is covered in your car insurance policy.
NOTE: Several states allow PIP coverage to travel with you. If you are a passenger in someone's car and are hurt in a crash, your PIP could cover you. Check with your insurance company.
PIP and Health Insurance
Personal injury protection can often work in conjunction with your health insurance.
You may have the option of setting your health insurance as your primary form of injury coverage after an accident.
This means that when you are hurt in an accident:
- Your health insurance benefits will pay your medical costs FIRST.
- Your PIP coverage will help with expenses that EXCEED your health insurance limits.
If you choose to set your health insurance as your primary form of coverage, you might be able to save money on your car insurance by purchasing lower PIP coverage limits.
You should consult with your car insurance and health insurance providers before making this decision. Some health insurance companies have limitations when it comes to covering injuries caused by car accidents; this option may not be available.
Who Needs Personal Injury Protection?
Generally, where personal injury protection is offered, it is required.
In a few select states, PIP is an option, but you may only refuse the coverage if you agree to certain limitations regarding your right to sue after a car accident. If you decide to refuse the coverage, you must do so in writing.
All states that require PIP coverage have set minimum limits (see below for an example). For further financial protection, you should consider purchasing higher limits, especially if you have health insurance coverage that has very limited benefits when it comes to injuries suffered from car accidents.
Kansas has a personal injury protection coverage requirement and sets the minimum required limits as follows:
- $4,500 per person for medical costs.
- $900 per month for 1 year for disability and loss of income.
- $25 per day for in-home services.
- $2,000 for funeral expenses.
- $4,500 for rehabilitation.
After an accident, you might find that the minimum limits set by state law won't cover your expenses. When you decide on your limits, think carefully about what level of protection you'll need.
Personal Injury Protection and Liability
While states that require PIP are considered no-fault states, this does not mean that fault is completely out of the question when it comes to car accidents and financial responsibility.
States that require personal injury protection also require liability car insurance, which helps pay for injuries or property damage suffered by others in car accidents you cause.
If you get into a car accident and are found at fault, the other driver's personal injury protection coverage will help pay for his injuries first, with your liability possibly covering costs that exceed his PIP limits.
Know Your Policy
It is understood in the insurance industry that not all policies are created equal. There may be caveats in your personal injury insurance that vary from the norm.
Study your policy and consult with your agent or insurance representative to learn all you can about your car insurance policy.