Question: What is the difference between PIP (personal injury protection) and medical payments?
Answer: It’s confusing to many people shopping for auto insurance when they’re offered both personal injury protection (PIP) and medical payments (MedPay) since both deal with medical expenses resulting from auto accidents, and without regard to fault.
Depending upon where you live, PIP or MedPay may be required. Typically, PIP is what you must carry if you are living in a no-fault state, and MedPay is optional in most states.
In general, the basic difference between these two coverages is that PIP usually comes with a deductible and has benefits that are broader than just covering medical bills, while MedPay doesn’t usually have a deductible (and actually might cover your PIP or health insurance deductible) and only covers medical expenses related to the auto accident.
Both PIP and MedPay:
- Cover certain medical expenses related to injuries up to the amount you’ve chosen to carry. Based on where you live and your insurer's options, the coverage that you can purchase may range from $1,000 to $25,000 or more. (Check with your state insurance regulator to find out what the minimum and maximum amount of coverage is offered in your state.)
- Normally covers you, family members and other passengers who were injured in an accident while riding or driving within your insured vehicle. Plus, you and covered family members are also usually covered if injured while riding in someone else’s car.
How the coverages differ
PIP normally covers only medical and hospital expenses that have been deemed reasonable and necessary, and you may have a short period of time in which to seek treatment and make your PIP claim. Whether a certain medical expense will be covered will be determined by state laws surrounding PIP coverage and the specific terms of your policy.
PIP gives broader coverage than MedPay. Personal injury protection typically comes with benefits that include:
- Necessary and reasonable expenses for: medical, hospital, surgical, nursing, dental, ambulance and x-ray services. Necessary medications, medical supplies and prosthetic devices may also be covered.
- Loss of income
- Replacement services / Disability services (for example, childcare or housework if parent is disabled due to accident related injuries)
- Funeral expenses / Death benefit
Medical payments coverage only covers medical expenses. It doesn’t offer coverage for lost wages or loss of essential services. Medical payments benefits usually include:
- Doctor or hospital visits or stays (including required surgeries)
- EMT/Ambulance expenses
- Professional nursing expenses
- Prostheses expenses
- Dental expenses
- Funeral expenses
When you have both PIP and MedPay as part of your auto insurance policy, MedPay is usually secondary to your PIP coverages.
If your state doesn’t require either of these medical coverages (see our interactive map of state-mandated coverages) and you don’t have health insurance, then consider adding PIP and/or Medpay when shopping for auto insurance. Reasonably priced coverage for accident-related medical bills, which can get quite expensive quite quickly, is much better than no coverage at all.
If you already have health insurance, then see if it will cover injuries resulting from auto accidents. If not, then MedPay or PIP may be needed. If your health insurance does cover accident-related injuries, then check costs to see if it’s worth carrying MedPay to cover any health insurance deductible you may have to pay for claims after an auto accident.
If your state requires PIP, then find out if you have the option to choose a higher deductible to lower your policy premiums.
Coverage for both PIP and MedPay is subject to the limits, terms and conditions of your car insurance policy, so if you have specific questions about what the medical coverage you have with your auto insurer, review your policy and speak to an agent of your auto insurance carrier. And always, if your rates are too high when including these coverages on your auto policy, shop around -- you could save yourself hundreds of dollars.