Personal injury protection (PIP) insurance

What is PIP insurance?

With standard auto liability insurance, the insurance company of the driver responsible for an accident pays the costs resulting from a covered accident (up to the policy’s limits). Personal injury protection is a “no-fault” coverage and is required in some states. "No-fault" means that regardless of which driver was at fault, some of the medical expenses for the policyholder and others in the policyholder’s car may be covered by insurance.

What does PIP insurance cover?

It may help pay a portion of medical and other expenses that result from a covered accident. This may include medical treatment of the injuries suffered by you and your passengers, as well as medical expenses you might incur if injured as a passenger in another car or as a pedestrian.

Additionally, PIP may cover:

• Service replacement of someone injured in a covered car accident
• Rehabilitation costs
• Funeral costs

Benefits of having personal injury protection

Following the initial shock of a car accident, one of the most frustrating issues can be the time it takes for insurance companies to determine blame, make payments and, if necessary, file a lawsuit. With PIP coverage, no blame needs to be assessed. If it is a covered incident, medical and lost income payments are made as soon as possible, and you deal only with your insurance company.

How is PIP coverage different from medical payments coverage?

PIP insurance is similar to medical payments coverage (med pay) but with an important difference. Med pay pays the medical costs for you and your passengers in the event of a covered auto accident, regardless of who’s at fault.

Unlike PIP, med pay doesn’t cover other expenses such as lost wages, rehabilitation services, funeral costs and services, such as childcare, that you may be unable to perform due to injuries from a covered accident.