What is Personal Injury Protection (PIP) Insurance

Personal Injury Protection Insurance

When you’re involved in an auto accident, the resulting medical expenses and lost wages can quickly become overwhelming, especially if you’re forced to miss work due to your injuries.

That’s where Personal Injury Protection (PIP) insurance comes in – it’s a type of coverage designed to provide financial protection and peace of mind in the event of an accident, regardless of who is at fault.

If you or a loved one has been in an auto accident, an Albuquerque car accident attorney will help you get compensation for your injuries and lost wages.

What is Personal Injury Protection (PIP) Insurance?

Personal Injury Protection, commonly referred to as PIP or “no-fault” insurance, is a type of auto insurance coverage that pays for medical expenses, lost wages, and other related costs for you and your passengers after an accident.

Unlike traditional liability insurance, which only covers damages and injuries you cause to others, PIP covers your own expenses, regardless of who was at fault for the accident.

In some states, PIP insurance is mandatory, while in others like New Mexico, it’s an optional coverage that drivers can choose to add to their auto insurance policy.

The specific requirements, coverage limits, and benefits of PIP vary from state to state, so it’s essential to understand your local laws and regulations.

What types of expenses does PIP cover?

Personal Injury Protection insurance typically covers a range of expenses related to injuries sustained in a car accident, including:

• Medical expenses. PIP can help pay for hospital bills, doctor visits, surgical procedures, ambulance services, diagnostic tests, and other necessary medical treatments resulting from the accident.
• Lost wages if you’re unable to work due to your injuries. PIP can provide compensation for a portion of your lost income or wages, up to the policy limit.
• Rehabilitation costs. PIP may also cover expenses related to physical therapy, occupational therapy, and other rehabilitation services required as part of your recovery process.
• Household services depend on your policy and state regulations. PIP may cover the costs of hiring services for tasks like cleaning, cooking, and childcare if you’re unable to perform them due to your injuries.
• Funeral expenses in the unfortunate event of a fatal car crash. Some PIP policies may provide coverage for funeral and burial expenses, up to a certain limit.

How much is the PIP payout?

The specific amounts and limits of PIP coverage can vary significantly based on your state’s requirements and the policy you’ve purchased.

Generally, PIP policies will have a maximum limit for medical expenses, lost wages, and other covered expenses.

For example, in Florida, the minimum PIP coverage required is $10,000, while in New York, the minimum is $50,000. Some states also have limits on the amount of lost wages that can be covered, such as 80% of your gross income or a specific dollar amount per month.

In New Mexico, PIP is not required, and instead, insurers offer medical payment insurance or MedPay.

PIP vs. MedPay

While Personal Injury Protection (PIP) and Medical Payments (MedPay) coverage may seem similar, there are some key differences:

• Fault – PIP insurance provides coverage regardless of who was at fault in the accident, while MedPay only covers medical expenses for you and your passengers if you were not at fault.
• Coverage – PIP typically covers a broader range of expenses, including lost wages and household services, while MedPay is primarily focused on medical expenses.
• Limits – PIP coverage limits are often higher than MedPay limits, providing more comprehensive protection.
• Availability – PIP is mandatory in some states but not others, while MedPay is an optional coverage that can be added to your auto insurance policy in most states.

PIP vs. UM/UIM

PIP and uninsured/underinsured motorist (UM/UIM) coverage are two separate types of auto insurance that serve different purposes:

• Coverage – PIP covers your own medical expenses and lost wages, regardless of who was at fault in the accident. UM/UIM, on the other hand, provides coverage if you’re involved in an accident with an uninsured or underinsured driver who is at fault.
• Fault – PIP insurance is a “no-fault” coverage, meaning it applies regardless of who caused the accident. UM/UIM coverage only comes into play when you’re not at fault, and the other driver is uninsured or underinsured.
• Availability – PIP is mandatory in some states but optional in others, while UM/UIM is generally an optional coverage that can be added to your auto insurance policy.

While PIP and UM/UIM serve different purposes, they can work together to provide comprehensive protection in the event of an accident.

How much does PIP cost?

The cost of Personal Injury Protection insurance can vary based on several factors, including:

• State requirements. Some states mandate higher PIP coverage limits, which can increase the premium.
• Coverage limits. Higher PIP coverage limits will typically result in higher premiums.
• Deductibles. Choosing a higher deductible can lower your PIP premium, but you’ll have to pay more out-of-pocket expenses before your coverage kicks in.
• Your driving record. Drivers with a history of accidents or traffic violations may face higher PIP premiums.
• Location. Insurance rates can vary based on your geographic location and the associated risk factors.

On average, PIP coverage can add anywhere from $50 to $200 or more to your annual auto insurance premium, depending on the factors mentioned above.

However, the added cost may be well worth the peace of mind and protection it provides in the event of an accident.

Get In Touch With An Albuquerque Car Accident Lawyer

At Parnall Law, we understand how auto insurance policies can be confusing, and we explore all available coverage for our clients. Our experienced attorneys will review your policy, explain your rights, and ensure you seek proper compensation in the event of an accident.

If you or a loved one has been in an auto accident, contact us today to schedule a consultation. We will fight for your rights and ensure you get the justice and compensation you deserve. Call us at (505) 405-4457 or online to get started.