Personal injury protection (PIP), sometimes called no-fault insurance, is an essential piece of auto insurance that equips you with coverage for medical expenses and, in some cases, lost wages and additional costs resulting from a car accident.
Designed to offer financial protection no matter who is at fault in an accident, PIP is required in some states and can significantly impact an individual's ability to recover from injuries sustained in a collision. Understanding the ins and outs of PIP can help you ensure you have the comprehensive coverage you need to stay safe behind the wheel. In this article, we’ll cover how it works, compare how it differs from liability coverage, and help you determine whether you need this type of protection.
How does personal injury protection work?
Personal injury protection typically covers you as the policyholder, your passengers, and sometimes pedestrians involved in the accident. If a covered injury occurs, you’ll want to file a claim with your insurer to collect compensation for medical treatment, rehabilitation, and sometimes lost income.
Personal injury protection offers swift and essential financial support to individuals injured in car accidents. It helps you access necessary medical care and recover for injuries without establishing fault or waiting for legal proceedings. You’ll want to keep in mind that the specific coverage and limits of PIP can vary by state and insurance policy, so it’s important to review your coverage details and understand the scope of protection offered by your PIP policy.
How does personal injury protection differ from liability insurance?
Personal injury protection and liability insurance are distinct aspects of auto insurance coverage. Since PIP provides coverage regardless of who is at fault, benefits are accessible to you, passengers, and, in some cases, pedestrians involved in the accident without the need to establish fault or pursue legal action.
On the other hand, liability insurance covers costs associated with injuries and property damage you are legally responsible for causing others. It typically includes bodily injury liability, which covers medical expenses and other costs for individuals injured in an accident where you are at fault, and property damage liability, which covers vehicle repair or replacement plus other property damaged in the accident. While PIP covers your medical expenses and lost income, liability insurance protects you from financial responsibility for injuries and damages others suffer.
Do you need to have personal injury protection?
All states require some type of auto insurance policy, but the details of this coverage vary depending on your location. For example, liability insurance is the most common form of required coverage, but several states require drivers to have personal injury protection.
The states typically requiring PIP coverage are often called "no-fault" states, where drivers turn to their insurance company to cover medical expenses after an accident. The specific states that require PIP insurance and the amount of coverage can vary, so it's necessary to check the insurance requirements in your state to ensure compliance with the law.
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