How can three little letters be so intimidating and confusing?

When it comes to car insurance, many topics are hard to fully grasp, just like homeowner’s insurance.

what is pip insurance

And sadly, much of the car insurance articles you’ll read online will leave you with more questions.

In this post today, I will help you understand what is pip insurance is as well as how it works and when you need it.

What Does PIP Stand For?

Personal Injury Protection

Is PIP Important?

Yes, PIP is very important.

A good way to remember this is by thinking of the character, Pip, in Charles Dicken’s beloved classic, Great Expectations.

Pip is not only the protagonist, whose actions make up the main plot, but he’s also the narrator, whose thoughts shape the reader’s perception of the story.

Pip indeed is the most important character in the timeless novel.

Depending on where you live, PIP quite possibly could be considered the most important line of coverage you invest in. 

What Does PIP Do For Me?

It will protect you, personally. And like Pip, it knows how to deliver a solid punch:

PIP is also known as "no-fault coverage," because it will pay no matter who is found to be at fault.

PIP will pay medical bills for you and the people in the car with you when you are hurt in a car accident

This coverage can also protect you if a collision occurs while you are a passenger in someone else’s car, or if you are hit by a car while walking or biking.

It’s kind of like your homeowner’s insurance coverage, which can cover the medical bills of a contractor who is injured on your property.

THE SIMPLY INSURANCE WAY

Car Insurance made easy.

Agents not required.

Get quotes and sign up online without talking to an agent. But, we are here if you need us. 

Unbiased, expert advice.

Get unbiased insurance education from licensed experts and also avoid dodgy sales calls.

Coverage in minutes.

You can get auto insurance coverage within minutes of getting your quotes and applying.

What Exactly Does PIP Cover?

Caps On Policy Benefits

The specific bills PIP will cover vary from state to state.

But here is what PIP will usually pay for:

do i need pip insurance
  • 80-100 percent of medical bills: This includes payments for surgeries, prescriptions, ambulance fees, rehabilitation, glasses, hearing aids, etc.
  • 60-80 percent of lost wages: This will pay you back for your actual lost income plus your lost earning capacity
  • 100 percent of services: This includes payments for services for things you can no longer do such as house cleaning, childcare, and yard work
  • 100 percent of mileage: This includes payments for the mileage on your car you rack up going back and forth to the doctors' offices and rehabilitation centers
  • $5,000 in death benefits: If someone on your policy dies, PIP will cover funeral costs and other expenses
  • Please note, personal injury protection claims typically need to be filed within 14 days of the accident.

Remember, this coverage is only for you and the passengers in the car with you at the time of a car crash. This coverage is for injuries and events that occurred during a traffic accident only. 

What Will PIP Not Cover?

PIP does not pay for any expenses for passengers and drivers in other cars involved in an accident. You need liability insurance for that. 

Again, PIP only pays for the medical bills and rehabilitation needed after car accident injuries. For injuries that didn’t happen in a car crash, you will need health insurance. 

Am I Required To Buy PIP?

That depends on where you live. Currently, 14 states require personal injury protection. 

Where Is PIP Required?

Here are the states where at least some amount of PIP is required

  • Delaware
  • Florida
  • Hawaii
  • Kansas
  • Kentucky
  • Massachusetts
  • Michigan
  • Minnesota
  • New Jersey
  • New York
  • North Dakota
  • Oregon
  • Pennsylvania
  • Utah

INSURANCE WHERE YOU LIVE

Car insurance by state.

How Much PIP Coverage Is Required?

Here’s how much those 14 states require for PIP coverage:

  • Delaware - $15,000 per person & $30,000 per accident
  • Florida – $10,000 per person, per accident
  • Hawaii – $10,000 per person, per accident
  • Kansas – $4,500 per person, per accident  
  • Kentucky – $10,000 per person, per accident
  • Massachusetts – $8,000 per person, per accident
  • Michigan – unlimited with a $0, $300 or $500 deductible
  • Minnesota – $40,000 per person, per accident
  • New Jersey – $15,000 per person, per accident
  • New York – $50,000 per person, per accident
  • North Dakota – $30,000 per person, per accident
  • Oregon – $15,000 per person, per accident
  • Pennsylvania – $5,000 per person, per accident
  • Utah – $3,000 per person, per accident

In Arkansas, Maryland, and Texas, you can decline PIP coverage by signing a waiver, but that is a bad idea.

How Much Does PIP Cost?

Car insurance costs vary greatly depending on many factors including the driver’s age, gender, marital status, credit history, driving record, location, type of vehicle, and more. 

There are free car insurance comparison tools you can use that do not require you to provide your social security number.

You start by simply entering your zip code, and it will give you a few of the best policies offered in your area for you to compare.

You can quickly compare PIP prices by top providers in your area using one of these tools.  

Generally, you can expect to pay 15% to 20% more to add PIP to your car insurance coverage.

Here’s a video to help explain how that investment will pay off:

THE SIMPLY INSURANCE WAY

Car Insurance made easy.

Agents not required.

Get quotes and sign up online without talking to an agent. But, we are here if you need us. 

Unbiased, expert advice.

Get unbiased insurance education from licensed experts and also avoid dodgy sales calls.

Coverage in minutes.

You can get auto insurance coverage within minutes of getting your quotes and applying.

Taking Action

There is no need to wait around if you need PIP insurance you can get started fast and easy today.

Remember some states require you to get pip insurance and others don't so be sure to review the insurance by state to make the best purchasing decision.

You can click here or any of the above buttons to get started. 


Sa El

About the author

Sa El is the Co-Founder of Simply Insurance and a licensed Insurance Agent with over 12 years of experience in the industry.  He specializes in Life & Health Insurance and is certified in Long Term Care Insurance in the state of Georgia. He is also an Official Member of the Forbes Finance Council, a licensed real estate agent in the state of Georgia (License #382602), an entrepreneur, insurance educator, and freelance writer.


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