Often it takes a
motor vehicle collision to realize that your auto insurance is insufficient and not comprehensive.
This blog post is the first in a series that identifies critical elements
of your auto insurance coverage and how to ensure that, going forward,
you have maximum protection in the event of an accident. One very important
and perhaps overlooked aspect of your coverage is PIP, or Personal Injury
What Is Personal Injury Protection (PIP)?
PIP provides first-party benefits to you and every occupant of your vehicle
in the event of a motor vehicle collision. Specifically, it offers payment
for medical bills and lost wages regardless of fault. While most drivers
carry the minimum amount of $2,500, you can purchase up to $10,000 in
PIP coverage depending on your insurance carrier.
The basic public policy idea behind PIP is that an injured motorist should
not have to hesitate to seek medical treatment, such as an ER visit or
physical therapy, due to concerns about paying the bill. Although $2,500
is not an enormous amount of money in light of today's skyrocketing
cost of medical services, it still provides a small base of treatment
for an injured driver or passenger.
What Will Insurance Companies Tell You About PIP?
However, the insurance companies are as duplicitous as ever these days
and will do everything in their power to prevent you from obtaining PIP.
In other words, they will trick you into "waiving" PIP. It is
not mandatory and it can indeed be waived, or excluded from your policy.
However, your insurance company must let you know how much you are saving
in your premium by waiving PIP. While the insurance companies can spin
the cost of these savings any way they want, in reality, the savings are MINIMAL!
How can you actually use this?
PIP is an inexpensive component of your policy and you should always ask
for a specific breakdown when obtaining or readjusting your auto coverage.
Whether online, over the phone, or in person, insurance companies will
continue to maintain that PIP is an unnecessary and expensive addition
to your policy. This could not be any farther from the truth and here
is one recent example of what a new client told me during an intake for
her personal injury claim: "My insurance agent told me that I didn't
need PIP because I have health insurance and that would pay for all my
Well, guess what happened? Her health insurance only paid for the hospital
bill after her ER visit. It did not pay for her emergency physicians bill
and it did not pay for her radiology bill (those are the three common
bills you receive from one ER visit). Sometimes hospitals and other medical
providers will not bill your health insurance if they become aware it
is related to a car accident. Sometimes there is no rhyme or reason as
to why your health insurance pays or does not pay a particular bill. Furthermore,
many physical therapists and chiropractors will not bill health insurance
for their services. For all of these reasons, if my new client had purchased
PIP coverage, she would not have had to worry about any of her ER bills.
Also, she could have used some of her PIP coverage to defray her physical
What’s the real story?
Unfortunately, our firm sees PIP "waivers" every day and are
only able to inform our clients about this insufficiency in their auto
coverage "after the fact." In the context of a
personal injury claim, PIP coverage will provide our clients with a higher settlement check
because of the fact that some, if not all of their medical bills, have
been paid through their auto insurance.
That is why I encourage everyone to not only make sure they have PIP coverage but to
INCREASE their PIP to $5,000, if not more. In addition, you should always ask for Med-Pay coverage if it is available.
This provides even more first party medical payment and/or lost wages
coverage at an inexpensive addition to your policy.
If you have any questions about PIP or other aspects of your auto insurance
contact the Law Offices of Adam M. Smallow at
DON'T SETTLE FOR ANYONE ELSE!
CRITICAL ELEMENTS OF AUTO INSURANCE COVERAGE: