Personal injury protection (aka PIP), sometimes referred to as no-fault insurance, can help cover things like your medical bills—or funeral expenses, in a worst case scenario—and in some cases also for the passengers in your car, after a covered accident, regardless of who the at-fault driver is.
TL;DR
- PIP covers medical expenses from a car accident, no matter who is at fault.
- It’s important to understand that PIP is a required coverage in some states, and an optional add-on coverage in others, but some states do not offer it.
- When you include PIP on your Lemonade Car policy, we could help pay for things like your medical bills, lost wages, and for the cost of some essential services that you can’t complete because of your injuries from the accident—like housecleaning.
- When choosing the limits of your PIP coverage, it’s a good idea to consider how much financial protection you’ll really need to pay out for medical expenses as a result of an accident.
- The main difference between MedPay and PIP, is that PIP covers a percentage of lost wages, public transportation to and from doctor’s appointments, or the costs of some essential services.
What is PIP?
PIP is a type of car insurance coverage that can help pay for things like your medical bills, lost wages, and other related expenses after a car accident.
With PIP, your own insurance company covers the medical expenses from a car accident regardless of who is at fault. Because PIP is a no-fault coverage, a covered driver can submit claims directly to their own insurance company, even if they aren’t at fault for the accident.
Basically, that means that if you have PIP on your policy and are involved in a covered incident, your insurance policy will pay for certain medical expenses related to the accident, up to the limits you pick when you sign up.
Do you live in a state where PIP is available, or required?
The following states require that you include PIP on your car insurance policy:
- Delaware
- Florida
- Hawaii
- Kansas
- Massachusetts
- Michigan
- Minnesota
- New Jersey
- New York
- North Dakota
- Oregon
- Utah
There are other states where PIP isn’t necessarily compulsory, but it’s available—and is arguably still a good idea to add it to your policy:
- Arkansas
- Kentucky
- Maryland
- South Dakota
- Texas
- Virginia
- Washington
- Washington D.C.
And just a quick FYI: These lists can change as state regulations do
Note that insurance rates in states that require PIP could be higher. That’s because your insurer might have to pay out in the event of a car accident, even if you’re not at fault.
What does PIP cover?
PIP can cover things like hospital and medical costs from the car accident, public transportation to and from doctor’s appointments, lost wages if you can’t work while recovering, the cost for some essential services that you can’t complete because of your injuries from the accident—like house cleaning expenses, and in a worst case scenario, funeral expenses.
In most cases this only pertains to yourself, but there are some states where it could also cover your passengers from the time of the accident—like Texas and Oregon.
Most state laws set minimum coverage limits for PIP. If you file an insurance claim, your insurer can cover medical expenses up to those coverage limits, but you’ll still need to pay the deductible that’s listed in your policy, if you have one.
The minimum coverage limits might not be enough to pay for all the medical costs and other expenses of a car accident, depending on your health insurance deductible, in which case you might want to select higher PIP limits.
It’s true: Choosing higher limits will raise your policy price. But it’s important that you include enough coverage that makes you—and your wallet—feel protected.
How is PIP different from medical payments coverage?
Since both PIP and medical payments coverage (aka MedPay) cover medical expenses, it’s easy to get them confused. But there are several key differences.
Car insurance policies include PIP in no-fault states like Oregon or New York, whereas you can only buy MedPay in states like Illinois or Tennessee. In other words, an insurance carrier may offer one, but probably not both, depending on where you live. Texas is an exception here, as some insurers offer both PIP and MedPay in the Lone Star state.
Medical payments insurance is usually optional, whereas some states require that a car insurance policy includes PIP—like Oregon. Personal injury protection also offers more coverage options.
The main difference is PIP covers a percentage of lost wages, public transportation to and from doctor’s appointments, or the costs of essential services you can’t perform while recovering from your injuries.
Understanding minimum coverage limits for PIP
Here’s a quick example of minimum coverage limits for PIP. In Oregon, the minimum limit is $15,000 per person for PIP. This will pay out regardless of who is at fault for the accident that caused your medical expenses. But this minimum limit can quickly be exhausted depending on the extent of your injuries.
It’s easy to see how the medical bills from a car accident could quickly exceed the minimum $15,000 per person coverage. So when you include PIP coverage on your policy, it’s a good idea to consider how much financial protection you’ll really need to pay out for medical expenses as a result of an accident.
What does PIP not cover?
PIP does not include insurance protection for the driver or passengers of the other car that was involved in the accident.
It also doesn’t cover any of the following, which would fall under other coverages that you may or may not have chosen to add to your policy.
Property damage liability
Property damage liability covers the costs to repair any property damage from an accident where you were at fault, whether that’s car repairs or fixing a fence. This one is a legal requirement in all states but New Hampshire and Virginia (if you want to drive without insurance in those states you have to meet certain financial criteria, in the case of NH, or pay a $500 fee, in VA).
Collision insurance
Collision insurance covers any damage to your own motor vehicle (unless the other driver carries liability insurance and they are the one who caused the accident).
Comprehensive insurance
The comprehensive insurance in your car insurance policy would cover any damages to your motor vehicle from theft, vandalism, or certain other perils.
A few quick words, because we <3 our lawyers: This post is general in nature, and any statement in it doesn’t alter the terms, conditions, exclusions, or limitations of policies issued by Lemonade, which differ according to your state of residence. You’re encouraged to discuss your specific circumstances with your own professional advisors. The purpose of this post is merely to provide you with info and insights you can use to make such discussions more productive! Naturally, all comments by, or references to, third parties represent their own views, and Lemonade assumes no responsibility for them. Coverage may not be available in all states.
