Having Personal Injury Protection (PIP) is not mandatory in most U.S states. However, purchasing a minimum PIP coverage (which varies by state) is mandatory in No-fault states. Most motorists purchase more than the minimum coverage to increase protection in the event of an accident.
PIP coverage can also be used to compensate your passengers’ losses after an accident regardless of who is to blame for the accident. But how much PIP should you have? A personal injury attorney in Bakersfield, CA can help you make this decision although.
Do I Need Personal Injury Protection?
PIP coverage is mandatory in 17 states according to the Insurance Information Institute but it’s available in most states although not mandatory for motorists. It’s important to have PIP to ensure you’re fully covered if you’re involved in an auto accident even if it’s not mandatory to have such coverage in your state. So, how much PIP is enough?
Personal injury protection is not necessary if you already have health insurance and you live in a state that doesn’t require PIP. However, motorists in at-fault states are not prohibited from buying PIP–particularly if they’re not well covered under their health insurance plans.
You could consider the deductibles applicable to your health insurance before purchasing PIP. For instance, you should consider a high-deductible PIP coverage if your health insurance carries a low deductible to reduce the premiums. It should however be noted that most PIP packages don’t include deductibles–meaning PIP can be ideal for health insurance policies with high deductibles.
If you don’t have health insurance, PIP is an affordable option to cover medical expenses, rehab costs, and others, after a car accident. Also, PIP can pay for burial and other expenses after a fatal car accident if the deceased didn’t have life insurance.
Keep in mind that health plans only pay for medical bills but don’t compensate injury victims for lost wages and disabilities resulting from an accident. On the other hand, personal injury protection can pay for such damages in addition to other damages that are not awarded under health plans. Also, PIP insurance policies provide the primary auto accident coverage in most states while health insurance covers provide secondary coverage.
Personal Injury Protection Policy Options
The common auto policy options offered by most insurance companies include:
- Standard auto insurance plan;
- Basic auto insurance plan; and
- Special auto insurance plan.
It’s important to select your auto insurance option carefully because the option selected can, and will impact the right to recover damages.
1. Standard Car Insurance Policy
A recent study showed that most people prefer the standard car insurance plan over the basic plan because it’s relatively affordable and provides extra coverage than the basic plan. The minimum limit for standard policies in most states can be as low as $15,000 per person or accident and a maximum limit of $250,000. Also, it includes a “Right to Sue” option which determines the recoverable damages in the event of an auto accident. The right to sue options are:
Unlimited Right to Sue
This option is ideal when PIP benefits, deductibles, and co-pays are useless. Under this plan, you can sue a faulting driver for losses (bodily injuries or property damage) resulting from their negligence–even for minor injuries. Also, the option eliminates injury thresholds and litigation waiting periods–meaning you can sue at any time after an accident provided the statute of limitations hasn’t expired.
Limited Right to Sue
The loss incurred (bodily injury or property damage) influences the right to be compensated by a negligent driver. In other words, a claim must meet certain requirements to be considered valid under the limited right to sue option, such as:
- Losing a body part;
- Significant disfigurement;
- Significant scarring;
- A fracture;
- Losing a fetus;
- Permanent injury or death.
2. Basic Auto insurance Plan
Most basic policies have a coverage limit of $15,000 per person or accident and it includes a limited right to sue option by default, that cannot be changed.
3. Special Auto Insurance Plan
The Special Policy is not provided to motorists who can get Federal Medicaid with Hospitalization and it’s better than PIP. This policy pays for emergency treatment after an accident and can compensate family members to a tune of $10,000 in death benefits.
4. Catastrophic Injury Benefit
Personal Auto policies in most states come with a catastrophic injury benefit in addition to the coverage limit stated in the policy–regardless of the insurance policy selected. Basic and Standard policyholders can be covered under this plan. The catastrophic injury benefit policy can pay for:
- A brain injury or spinal cord injury;
- Expenses of immediate care at a trauma center or hospital.
The right amount for PIP can vary by case and other factors, such as your health insurance plan, insurance laws of your state, and others. Consequently, you might need legal advice to make an informed decision.
